Leader: To win again, Labour must learn from its past failures

The next leader must develop an alternative to New Labour's neoliberal economic model.

The 109-day leadership election is over. On Saturday 25 September, the 20th leader of the Labour Party will be announced at its annual conference in Manchester. His name will be Miliband. Whether the victor is David or Ed - and we have made clear our preference for the latter but also our admiration for the former - the challenge facing the new leader will be the same. How will he rebuild a party that slumped to its second-worst vote share since 1918? How will he refresh and re-energise Labour, which left office after 13 years demoralised, fractious and hollowed out? And how, above all, does the new leader persuade the electorate that the party can once again be trusted to form a government and manage economic policy?Here, Labour's history is not reassuring: once ejected from office, it tends to spend long periods in opposition - 13 years after 1951, 18 years after 1979.

Although the contest for the leadership has been unusually protracted, it has, nonetheless, been animated by ideas. The hustings, though often tedious, excessive in number and constraining in their format, have ensured that the candidates have had to listen to the concerns of a neglected and disgruntled party membership. Indeed, since the general election, Labour has acquired more than 30,000 new members.

Unsurprisingly, Labour's critics have not been convinced. The Deputy Prime Minister, Nick Clegg, has claimed that, while members of the public have submitted thousands of ideas for cutting the deficit, the five Labour leadership contenders have failed to come up with a single one. In fact, Labour proposals for cutting the deficit have ranged from extending the bankers' bonus tax (Ed Miliband) to introducing the 50p top rate of tax on those earning over £100,000 (Ed Balls), a land-value tax (Andy Burnham), a mansion tax (David Miliband) and scrapping Trident (Diane Abbott). These last two ideas were loudly advocated by Mr Clegg and the Liberal Democrats before they entered into coalition with the Conservatives.

The next Labour leader must develop these ideas, which combine deficit reduction with a commitment to income redistribution. But he has to go much further. It is still not clear that any of the candidates has fully absorbed the lessons of the financial crisis or acknowledged the fatal blow it administered to New Labour's neoliberal economic model.

Political and philosophical challenges abound. The centralising tendencies of the Blair-Brown years have left Labour vulnerable to the coalition's seductive "big society" rhetoric. Does Labour have a new story to tell about the relationship between society, community and the state? Will a new leader embrace the electoral and constitutional reforms required to repair the democratic deficit in British politics? He must be at the forefront of the campaign in favour of the Alternative Vote (AV). This is no time for opportunism. Moreover, embracing AV will encourage disaffected Liberal Democrats, as well as prove his pluralist credentials. Labour tribalism should be rejected.

However, oppositions don't win elections: governments lose them. Last month, the coalition's approval rating turned negative for the first time. An Ipsos MORI poll published on 16 September put Labour and the Tories neck and neck at 37 per cent. And that is before the effect of the public spending cuts is felt. These are no grounds for complacency, however. The new leader of the opposition will face a hostile media and, in David Cameron, an astute and ambitious opponent intent on occupying the centre ground. But these are uncertain times and coalition politics remains a novelty. In one or other of the Miliband brothers, Labour will have an intellectually confident and politically nimble leader capable of winning the next general election.

This article first appeared in the 27 September 2010 issue of the New Statesman, The 50 people who matter