LET US FACE THE FUTURE AGAIN - WES STREETING MP - Fabian Society

Page created by Alberto Manning
 
CONTINUE READING
LET US
FACE THE
FUTURE
AGAIN
WES STREETING MP

                   FA B I A N I D E A S N O. 6 51
Fabian Society
61 Petty France
London SW1H 9EU
www.fabians.org.uk

Fabian Ideas 651

First published March 2020
ISBN 978-0-7163-0651-1

Editorial director: Kate Murray
Assistant editor: Vanesha Singh

This pamphlet, like all publications of the Fabian Society,
represents not the collective views of the society but only the
views of the authors. The responsibility of the society is limited
to approving its publications as worthy of consideration within
the Labour movement. This publication may not be reproduced
without express permission of the Fabian Society.

© The Fabian Society 2020

The moral rights of the author have been asserted.

British Library Cataloguing in Publication data. A catalogue
record for this book is available from the British Library.

Designed by soapbox.co.uk
Printed and bound by DG3, London, UK

To find out more about the Fabian Society, the Young Fabians,
the Fabian Women’s Network and our local societies, please
visit our website at www.fabians.org.uk
FABIAN IDEAS NO. 651

LET US FACE THE
FUTURE AGAIN
WES STREETING MP

FOREWORD                                                        2
There is No Hope in Nostalgia

INTRODUCTION                                                    4
Back to the Future: It’s Not Just a Change
of Leadership We Need, It’s a Change of Direction

CHAPTER 1                                                       7
Economic Inequality: A Tale of Two Britains

CHAPTER 2                                                      18
Our Ageing Society: Living Good Lives, Not Just Longer Lives

CHAPTER 3                                                      26
Technological Revolution: Creating a Future
That Works for Everyone

CHAPTER 4                                                      35
Climate Emergency: ‘Cathedral Thinking’
to Tackle the Climate Breakdown

CHAPTER 5                                                      41
Shifting Global Power: Defending and Extending
Democracy, Freedom and Human Rights

CONCLUSION                                                     51
People, Places and Planet: A New Story for
Our Party and a Brighter Future for Our Country

ACKNOWLEDGEMENTS                                               54

ENDNOTES                                                       55
FOREWORD
                  THERE IS NO HOPE IN NOSTALGIA

    the old is dying and the
   …                                            centre-right parties, shipwrecked the
   new cannot be born; in this                  centre left and given rise to populism
   interregnum a great variety                  and extremism.
   of morbid symptoms appear.                       The 2019 general election result
   – Antonio Gramsci                            means that the policies and the priorities
                                                of a resurgent Conservative party
Our mission is simple: to renew                 will define our country’s direction at
the Labour party so that we can                 a pivotal moment. Brexit is happening,
rebuild our country. Britain is deeply          but the greatest risk for our country
divided, economically, culturally and           is the politics of Brexit trapping
politically. The social contract that has       us in an argument about a better
underpinned the United Kingdom since            yesterday, instead of building a plan
the creation of the welfare state after         for a better tomorrow.
1945 is unravelling. We have lost our               The scale of Labour’s defeat is clear.
sense of common purpose and a shared            We have suffered four election defeats
understanding of our place in the world.        in a row and 2019 saw our worst result
It is no exaggeration to state that our         since 1935. We are on life support in
current malaise is an existential crisis,       Scotland. We are on a final warning in
for it is not a given that our ‘disunited       Wales and large parts of the north and
kingdom’ will survive the next decade.          midlands of England. We are irrelevant
    Britain’s crisis does not exist in          in the south outside of London and
a vacuum. Across liberal democracies            major university towns and cities.
the long tail effects of the global                 The problem was not just Corbyn,
financial crisis, the economics of              but Corbynism. It saddled us with
austerity, rapid deindustrialisation            a manifesto that people didn’t believe
and the hollowing out of towns and              in, a world view that people reviled
communities have combined with                  and a culture that people feared.
concern about high levels of migration          These problems were not just
to form a perfect storm that has battered       foreseeable, but foreseen. Ideological

                                            2
LET US FACE THE FUTURE AGAIN

dogma, vanity and hubris meant that              Many will discover first-hand the grim
the warning signs were not heeded. It            reality of our social insecurity system.
didn’t have to be this way and we can            There is a risk that climate change
never allow this to happen again. Losing         will fall even further down the agenda
isn’t radical. Our aim isn’t to ‘hold            of world leaders. Collective global
the government to account’, it is to be          leadership in response to the pandemic
the government. When Labour loses,               has been noticeably lacking since the
the country loses.                               crisis began. If a ‘wartime effort’ is
   There is no future for the Labour             required to bring Britain through this
party if the debate about our direction          crisis, we have a responsibility to build
becomes locked in an ideological battle          a better economy, society and world in
between two competing visions of the             its aftermath, just as we did in 1945.
past instead of building a politics that             I am grateful to the Fabian Society
unites the country around a vision for           for publishing this work. It does not
the future. There is no hope in nostalgia.       pretend to contain all the answers.
   The Labour party wins when it                 No one individual or political tradi-
turns its face firmly to the future, as it       tion has a monopoly on wisdom or
did in the 1945 manifesto with Let Us            virtue. If this fact had been realised
Face The Future, in 1966 with Time for           and appreciated – not just in recent
Decision and in 1997 with New Labour:            years, but in recent decades – our
Because Britain Deserves Better. This            collective politics would be stronger.
pamphlet is a new attempt to do the              The Fabian Society does recognise this
same. It considers how we might build            fact, which is why it has been a place for
a new centre-left politics to address the        open-minded and good-hearted debate
crisis facing our country, as well as how        and disagreement about the future of
we build the foundations to confront             the left since 1884. In that spirit, my
five key challenges ahead: economic ine-         arguments are unapologetically rooted
quality, an ageing society, technological        in the mainstream centre-left traditions
revolution, the climate emergency and            that changed this country for the better
shifting global power.                           under five Labour prime ministers and
   These challenges have been                    the revisionist tradition that understands
thrown into sharp relief by the corona-          that our lasting values have to be applied
virus pandemic, the extent of which was          to the challenges of the future.
becoming clear just as this pamphlet                 The country is looking for more than
was going to print. It has underlined the        a protest against past wrongs. Let us
fragility of our economy and the insecu-         face the future again.
rity of our society. Older and vulnerable
people have been left dangerously                Wes Streeting MP
exposed because of the social care crisis.       March 2020

                                             3
INTRODUCTION
                   BACK TO THE FUTURE: IT’S NOT
                 JUST A CHANGE OF LEADERSHIP WE
                 NEED, IT’S A CHANGE OF DIRECTION

    e have now to rethink the
   W                                             of England, mostly concentrated in
   philosophical foundations of our              university towns and cities. But we also
   socialism under highly unfavourable           have a problem in the north east and
   conditions, because we must square            north west of England, where Labour
   our philosophy with the conditions            lost 20 seats; Yorkshire and the Humber,
   of the world of today and tomorrow,           where Labour lost nine seats; the east
   unless we are content to be merely            Midlands, where Labour lost seven
   the dying advocates of a lost cause.          seats; the west Midlands, where Labour
   – GDH Cole                                    lost nine seats; and the east of England,
                                                 where Labour is down to five seats
In its present condition, the Labour             from seven.
party is unable to deliver the change                Seats that have returned Labour
our country needs. The defeat on                 MPs for the best part of a century went
12 December 2019 was on such                     Conservative. Even in London, which
a scale that it requires an equally urgent       returned the single Labour gain of the
and seismic response. Honesty is the             election, we also lost a seat and Labour’s
best policy.                                     vote share went down by 6.4 per cent.
   After the previous run of four                    In Wales, the Conservatives achieved
successive election defeats in 1992,             their best result since 1983. With the
Giles Radice published a seminal                 sole exception of Alyn and Deeside,
pamphlet for the Fabian Society entitled         Labour’s representation is confined
Southern Discomfort, analysing what              to south Wales. In Scotland, Labour
he described as ‘Labour’s southern               is on life support with just a single MP
problem’. If only things were that               for the second time in three elections.
simple now. Labour still has a southern              The Conservatives outperformed
problem, with only 14 seats outside              Labour in every social class. The
of London in the whole of the south              crossover age at which people were

                                             4
LET US FACE THE FUTURE AGAIN

more likely to vote Tory fell from 47 to        political leadership. After 2010, Labour
39. Among working-class voters, they            had to define a fresh and coherent vision
enjoyed a 15-point lead, winning                to meet the challenges of a post-crash
more votes than Labour amongst                  world. But Ed Miliband’s team couldn’t
manual workers and households with              shake off the Tory attack that ‘Labour
incomes below £20,000.1 For a party             crashed the economy’, or comfortably
founded to represent the interests of           frame a forward-looking argument
working-class people, this raises serious       without appearing to join in the attack
existential questions.                          on Labour’s record.
    The uncomfortable truth is that                In many ways, the election of Jeremy
Labour’s problems can’t be reduced              Corbyn as leader of the Labour party
to ‘southern discomfort’ or the collapse        was a direct response to this malaise.
of the ‘red wall’. We have a problem            In place of process-focused, technocratic
everywhere. The problem is the                  thinking, he painted in primary colours,
Labour party.                                   offering ‘straight-talking honest politics’.
    Since it was founded in 1900, the           In place of top-down machine politics,
Labour party has contested 31 general           he promised party democracy. In place
elections and won a working majority            of coarse political debate, he promised
in only five of them: in 1945, 1966,            kinder, gentler politics.
1997, 2001 and 2005. By any standards,             But rather than reversing Labour’s
this is a lamentable record for a major         decline, Jeremy Corbyn’s leadership
political party. The pattern has become         exacerbated it. Labour went into
all too familiar: prolonged periods of          the general election with the most
opposition, interspersed with periods           unpopular leader of the opposition since
of Labour government that delivered             records began. Corbynism saddled us
meaningful and sometimes lasting                with a manifesto that people didn’t
change for our country, perennially             believe in, with an endless wishlist of
plagued by dogma and division about             promises that led to real questions about
what the Labour party is for and who            whether they were achievable, let alone
it is supposed to represent. The conse-         desirable. It offered a worldview that
quence has been a Conservative century.         people reviled, from the response to the
    The roots of Labour’s present crisis        poisoning of the Skripals in Salisbury
predate Jeremy Corbyn’s leadership of           to a back catalogue of public statements
the Labour party. New Labour pro-               about terrorists that led voters to
foundly misunderstood globalisation:            question whether the Labour Party
it was seen as an inevitable fact of life       would side with our country’s enemies
and uncritical support for it became            over our friends. It presided over
an unwise test of our modernising               a culture that people feared, with the
credentials. Globalisation should rather        unchecked spread of a toxic, antisemitic,
have been viewed as a construct of              conspiracy theorist politics that saw
political decisions, which needed to            Jewish MPs and members hounded
be managed and shaped by progressive            out of the Labour Party.

                                            5
FABIAN IDEAS NO. 651

    It cannot be denied that Brexit was            The next leader of the Labour party
a serious problem for Labour at the 2019           needs to hit the reset button loudly
election, but this provides little cover for       enough that the voters notice. That
an abject failure of leadership. Strong            doesn’t mean that we need to jettison
political parties shouldn’t be merely              every policy, embrace the damaging
victims of political events, they should           economics of austerity or seek solace in
define the narrative and the response              past victories. But it does mean building
to the challenges facing our country.              a transformational economic policy that
Whichever way the Labour party turned,             people can believe in, a worldview that
it risked alienating swathes of voters.            provides security and opportunity in
This would have been true even if we’d             a turbulent world and a political culture
had a genuinely pro-European leader.               that is open, welcoming and inclusive.
But instead of making a principled                     We are in the early stages of a new
argument with clarity and conviction,              parliament. Our choices now will deter-
Corbynism triangulated on the biggest              mine whether this moment will mark
question facing our country and, in                the start of a march back to power, the
aiming to please both sides, ended up              midpoint of another long period in the
pleasing neither. Worse still, our leaders         wilderness or a death spiral that brings
willingly embraced an election on Boris            to an end an interesting century-long
Johnson’s terms, labouring under the               experiment called the Labour party.
delusion we were ‘election ready’.                     In short, it is not just a change
    There is no future for the Labour              of leadership we need, it is a change
party in Corbynism without Corbyn.                 of direction.

                                               6
CHAPTER 1
                           ECONOMIC INEQUALITY:
                           A TALE OF TWO BRITAINS

    he political problem of mankind
   T                                               Britain’s one per cent have seen their
   is to combine three things:                     share of household income triple in the
   economic efficiency, social                     last four years whilst ordinary people
   justice and individual liberty.                 have struggled.2 The last decade saw
   – John Maynard Keynes                           the slowest growth in living standards
                                                   since the second world war.
Ours is a great country full of promise and           Hard work does not necessarily
opportunity. One of the richest countries in       guarantee even a basic standard of liv-
the world, we have world-class universities,       ing. Wages have failed to keep up with
entrepreneurs and captains of industry,            living costs. Fourteen million people
groundbreaking scientists and inventors,           live on incomes below the poverty line,
globally renowned artists, and a vibrant           including 4 million children.3 Outright
civil society.                                     gender discrimination exists and is
   But this is also a country of stagger-          entrenched by this economic structure,
ing inequality, intolerable poverty and            with complex factors constraining the
wasted potential. Our economic model               employment options open to women,
isn’t working for the majority of people           trapping many in part-time jobs and
and the social contract that underpins             in-work poverty with little opportunity
our country is broken.                             for wage growth or promotion. Black,
                                                   Asian and minority ethnic people face
INEQUALITY TODAY                                   barriers throughout their lives including
Wealth and income inequalities in                  educational attainment gaps, precar-
the UK are stark. The richest 10 per cent of       ious employment, and the continuing
households own 45 per cent of the nation’s         hostile environment.
wealth, while the poorest 50 per cent                 Inequality and the poverty it creates
own less than 10 per cent. The average             have led to an increasing number of
FTSE 100 chief executive is paid 145               what the economist Sir Angus Deaton
times more than the average worker and             calls ‘deaths of despair’, caused by

                                               7
FABIAN IDEAS NO. 651

drug and alcohol abuse due to financial          the economic storm clouds for the
hardship and hopelessness. The rate              global economy over the coming decade,
of these deaths amongst men has more             a concern echoed by the outgoing
than doubled since the early 1990s.4             governor of the Bank of England,
The human consequences of economic               Mark Carney.
inequality are clear in government                   The IPPR warns that by 2030,
statistics: people are needlessly dying.         stagnation will be the new normal,
   These economic divisions are not              and that we are in for a low-growth,
merely drawn across our class system             low-productivity and low-interest
but across the regions and nations of            rate decade, with weak investment
our country. Britain is home to nine             and labour power. Slow income
of the 10 poorest regions in western             growth and a less supportive welfare
Europe, but also the richest: inner              system will make the 2020s a period
London West. A child on free school              of stagnation that will be felt acutely
meals in Hackney is still three times            by low-income households. As well
more likely to attend university than an         as the inequality between the richest
equally poor child in Hartlepool. The            and poorest, the UK’s sharp, growing
gap in productivity between English              and unprecedented intergenerational
regions is worth around £40bn per year, 5        differences will become more pro-
with productivity in the south east and          nounced. By 2030, almost 40 per cent of
London standing at 50 per cent above             all under-40s are forecast to be living
the national average.6                           back home with their parents – up from
   In the last 40 years, we have wit-            14 per cent today.7
nessed a significant decline in the UK’s             The coming decade will see signif-
manufacturing base with serious social           icant changes to the structure of our
consequences in former industrial towns          economy and the labour market, not
and profound political consequences              least as a result of technological devel-
in the form of Brexit. People have seen          opments discussed in chapter three.
their jobs disappear as a result of one of       140,000 retail jobs were lost in 2019
the largest deindustrialisations of any          and some estimates forecast retail job
major nation, with production exported           losses of up to 2 million over the coming
to countries with cheaper labour costs           decade,8 while sectors like education,
through outsourcing or being lost                health and care are expected to grow,
altogether to labour-saving technology.          as are jobs in business services, creative
                                                 industries and the digital economy.
THE CHALLENGES AHEAD                             The extent to which self-employment
The World Economic Forum has                     and job insecurity will become the norm
warned that unsustainable asset                  is contested territory, but insecure hours,
prices, high levels of indebtedness              constraints on in-work benefits and the
and the ‘limited firepower’ available to         concentration of decent, well-paid jobs
governments and central banks in the             in the south east are already leaving too
event of another major crisis are forming        many people with a poor quality of life.

                                             8
LET US FACE THE FUTURE AGAIN

   Public finances will be under pressure,         FACING THE FUTURE
particularly as a result of the rising costs       The liberal market settlement born
of climate change, pensions, health and            of Thatcherism is not up to the job of
social care. The tax gap between receipts          rebuilding Britain’s economy to work
and expenditure is expected to grow.               in the interests of everyone, but nor are
   Each of these challenges would                  the often hierarchical and paternalistic
be difficult to negotiate in normal                institutions of our existing welfare state.
circumstances, but the UK will need                Both require reimagination to meet the
to do so whilst extracting itself from             challenges of the 21st century.
the most sophisticated political and                   A strong economy and a just society
economic alliance in the world. Much               go hand in hand. This should be the
depends on the nature of the future                central goal of Labour’s economic policy.
relationship negotiated between the                Disraeli’s description of England in the
UK government and the European                     19th century as “two nations between
Union. Boris Johnson’s planned                     whom there is no intercourse and no
divergence from the EU’s institutions              sympathy; who are as ignorant of each
and regulations is certain to bring                other’s habits, thoughts, and feelings, as
higher economic costs. Our exit will be            if they were dwellers in different zones,
built on an unsteady foundation, with              or inhabitants of different planets” has
existing growth in 2019 at its lowest              remarkable salience today. We need
rate outside of a recession since the              to be able to speak to the hope and
second world war. Even with spending               ambitions of every region, nation and
increases to soften the blow, the IFS              section of society. We need to enter the
forecasts that growth will only rise               next election having already persuaded
0.5 per cent in the near future as we              people on middle and high incomes of
begin negotiations. In November 2018,              the shared benefits of lifting 4 million
Theresa May’s government prepared                  children out of poverty and having
economic forecasts of potential                    addressed concerns among all income
Brexit deals. The forecast closest to              groups about our ability to spend their
today’s plan, the free trade agreement             money wisely.
scenario, ‘would see GDP between
4.9 per cent and 6.7 per cent lower                EARNING TRUST
compared with staying in the EU,                   Labour first needs to win back trust that
depending on immigration policy.                   we can deliver on our promises and be
Trade with the EU under this sce-                  trusted with people’s money. At the 2019
nario is estimated to be 25 per cent               general election, nearly two-thirds of
lower – and 5 per cent higher with                 the public weren’t convinced our policies
non-EU countries – than if the UK had              were achievable, let alone desirable. The
remained in the EU.’ 9 A United King-              credibility of the ‘fully costed manifesto’,
dom weakened economically by Brexit                which was already being tested as
will find it increasingly difficult to             a result of plans to increase proposed
address the global challenges we face.             spending from around £50bn in 2017

                                               9
FABIAN IDEAS NO. 651

to £80bn in 2019, was put under further           policymaking bodies to ensure that
stress by a nationalisation programme             every penny committed is directed
that Labour refused to put a price on,            towards just aims or otherwise justified.
repeating often the unconvincing line             Labour must never again go into an
that ‘parliament will set the price’.             election with a manifesto less progress-
It was then damaged further by                    ive than the Liberal Democrats’.
a seemingly last-minute proposal to                   Labour doesn’t need to embrace
nationalise BT’s broadband business,              the politics of austerity to be credible.
with figures as high as £100bn being              Demographic pressures on budgets
mooted. It was then finally shot to pieces        for health, social care and pensions,
by the subsequent announcement of an              the need to rebuild public services
additional £58bn compensation package             after a decade of swingeing cuts and
for WASPI women, which even the                   changes to the nature of global threats
proposed beneficiaries saw as too good            to national security all point towards
to be true.                                       the need to spend more. The public
   We must re-learn the language                  understand that we can’t demand Scan-
of priorities. Why did our manifesto              dinavian public services on American
commit to spending over ten times more            taxes, but they do need convincing that
on higher education than on lifelong              Labour will be careful with their money.
learning, and more than double than               So alongside a commitment to raise
was proposed for early years or schools           public spending as a share of national
when the evidence suggests investment             income, Labour should have clear
in these areas creates more socially              fiscal rules committing us to balancing
just outcomes? Why was providing                  day-to-day spending with revenues
free broadband a greater priority than            over the course of a parliament and an
providing free childcare or social care?          explanation of how much we plan to
Where Labour’s goals were progressive             borrow to invest and why this represents
and desirable, like the pledge to abolish         good value.
in-work poverty during the lifetime of                The strongest defence for Labour’s
a parliament, they weren’t afforded the           2019 manifesto is that its proposed
resources needed to achieve them. Even            increases in the size of the state and
the Liberal Democrats’ commitment to              public ownership were not dissimilar
increase benefits for the low-paid were           from other successful European
more generous than Labour’s.                      economies, including the strongest:
   Alongside a fully costed manifesto,            Germany. But the scale and pace of
Labour should publish a distributional            change on offer was not achievable –
analysis of all tax and spending                  and it was not seen to be achievable
commitments to show how they                      by voters. Labour’s next leadership
would affect households with different            should set out a bold and ambitious
levels of income. This type of analysis           vision for our country’s future, but
should appear alongside every policy              offer a simple, practical and believable
put forward for adoption by Labour’s              manifesto for a five-year parliament

                                             10
LET US FACE THE FUTURE AGAIN

that gives voters the confidence to elect         property. It could be replaced altogether
a Labour government.                              with a lifetime gifts tax.
                                                     There is a strong case for increasing
A FAIR AND HONEST TAX POLICY                      corporation tax and for taking further
Increases in public spending require              action on multinational tax avoidance.
increases in tax. This was well under-            The rate of corporation tax is by far the
stood by a sceptical public, who did              lowest in the G7 with little discernible
not believe that Labour’s spending                evidence to justify the current main rate
plans only involved increases in tax for          of 19 per cent. Increasing corporation tax
the wealthiest five per cent and large            to 24 per cent would still leave the UK
corporations. Similarly, while a focus            with one of the lowest rates in the G7.
on improving productivity and wealth                 Many of Labour’s 2019 manifesto
creation to boost tax revenues is correct,        policies would have created other tax
these revenues alone are not enough               burdens for businesses higher than in
to meet even existing pressures on the            almost all advanced economies. There
public finances and our public services.          were serious questions about whether
It is time to put fairness and justice at         they would generate the revenues
the heart of our tax system.                      suggested, and if they would lead to
    Increased concentrations of wealth            losses of jobs and investment to the UK.
and growing levels of intergenerational           For example, the proposal to introduce
inequality necessitate a greater focus on         a unilateral financial transactions
wealth taxation. It is unacceptable that          tax in place of a multinational effort
those who have worked hard end up                 would have been an extraordinarily
paying more in tax than those who have            bad decision for a global centre for
gained from investments or dividends.             financial trading.
Labour’s manifesto was right to argue                There are a number of steps by
that capital gains tax should be taxed            which the UK could clamp down on tax
on the same basis as tax on income –              avoidance by corporations or tax havens.
a policy previously proposed by the               The abuse of charitable vehicles to buy
IFS and the IPPR – and that the poorly            property and avoid stamp duty land
named and targeted ‘entrepreneurs’                tax should be tackled by HMRC and
relief’, described by the Resolution              the Charity Commission. High-value
Foundation as ‘the UK’s worst tax break’,         commercial property is usually not
should be abolished.                              subject to stamp duty land tax, because
    The current system of inheritance tax         the property is held in special purpose
is indefensible. The rich are notoriously         companies and it is the shares in those
good at avoiding it and the rest are              companies – rather than the real estate
too often unnecessarily worried about             itself – which is sold. It would be fair and
it. Serious reform is required, which             right to apply stamp duty land tax to the
could include capping or scrapping                sale of those shares. A withholding
over-generous reliefs and allowances,             tax could be introduced on payments to
like the exemptions for business                  tax havens. Tech companies engaged in

                                             11
FABIAN IDEAS NO. 651

tax avoidance could face a withholding             investment, poor access to finance, weak
tax or be subjected to licensing fees and          exports, poor productivity and market
conditions in order to operate in the UK.          dominance by multinationals.
   Business will only deliver the tax                 The Labour party is not an
receipts for future Labour governments             anti-capitalist party. To paraphrase
to spend if our fiscal policy strikes              Churchill, capitalism is the worst
the right balance between making                   economic system except for all those
sure they pay their fair share without             other systems which have been tried
incentivising them to take their jobs              from time to time. We oppose excessive
and activity elsewhere.                            concentrations of corporate power and
                                                   are determined to break up monopolies
REFORMING CAPITALISM                               and oligopolies. We want to see an
There is a vacancy for a pro-enterprise            end to crony capitalism, facilitated by
party in British politics. The Conserv-            poor political judgement, that allows
atives have built Britain’s anaemic                public services to be outsourced, profits
economic recovery on weak founda-                  privatised, the risk kept with the state,
tions. Their Brexit approach is at best            big bucks paid to company directors
indifferent, and at worst actively hostile,        and workers stripped of their decent
to the concerns of British business. Who           terms and conditions. Carillion is a
can be surprised, when our own prime               prime example of this. The next Labour
minister is famously reported as saying:           government should work with the best
“Fuck business”?                                   of British business to reform the worst
    Businesses offer Britain a lot                 of British capitalism.
more than tax receipts for Labour                     Action should be taken to improve
governments to spend on public                     the diversity of company boards, with
services. Companies create jobs and                a requirement for companies to publish
opportunities. Private enterprises                 clear action plans for achieving gender
innovate and create. They supply                   balance and the widening of diversity.
products and services from everyday                As part of a broader set of proposals for
essentials to life-changing enhance-               industrial democracy, every public and
ments. They build physical and digital             private sector organisation with more
infrastructure. Britain’s private sector           than 250 employees should have elected
is home to world-leading industry. The             employee representation on their board
Labour party shouldn’t just claim to be            and remuneration committees. Report-
pro-business. We should mean it.                   ing on pay gaps for women and ethnic
    But capitalism is now in crisis.               minority groups should be mandatory.
The promise of capitalism – that each                 Labour’s plans for nationalisation
generation fares better than the last –            were too easily portrayed as being
is broken and with it the social contract          based on an ideological attachment to
of our country. This crisis of capitalism          the past rather than a plan for Britain’s
is bad for the businesses which are                future. The East Coast mainline
hampered by short-termism, low                     demonstrates the viability of a model

                                              12
LET US FACE THE FUTURE AGAIN

for public ownership where autonomous                if more businesses were to become
state-sponsored companies run                        cooperatives or employee-owned like
public services in the public interest.              John Lewis. Heavy-handed mandatory
The Labour party should review                       transfers of shares would create nothing
each proposed nationalisation in our                 but ill-will, costly legal battles and
manifesto, assessing the merits of each              damage to the UK’s reputation for
on the basis of three criteria: which                upholding the rule of law. Instead, we
model would give the public the best                 should be looking at ways to encourage
experience of the service, which model               and incentivise existing business owners
would provide best value for money                   to pass their business to employees and/
and which model would best level up                  or customers when they retire. We could
parts of the country that have been left             combine the proposal above to abolish
behind? As well as rediscovering the                 inheritance tax exemption for business
language of priorities, the Labour party             property with a new inheritance tax and
must re-learn the distinction between                capital gains exemption for business
ends and means. The means of achiev-                 owners who give their businesses over
ing a goal are important, but it is the              to a trust for the benefit of customers
end goal that matters most.                          and/or employees.
    The most outrageous policy in                        Changing the world of work for good
Labour’s manifesto was for a so-called               is not just a TUC or Labour slogan; it
‘inclusive ownership fund’. This would               is central to reforming capitalism to
have required 10 per cent of the shares              work in the interests of everyone. Better
in all UK companies with more than                   pay, better conditions and better job
250 employees to be owned by a state                 security are the key indicators of social
fund, with dividends shared between                  progress, but our economy is heading
employees and capped at £500, with                   in the wrong direction with more
the rest being paid to the exchequer.                people experiencing insecure work and
Promoting greater employee ownership                 millions not earning enough to make
is a noble ambition. Anchor share-                   ends meet. The next Labour government
holdings could promote longer-term                   should enhance employment rights
thinking within the boardroom. But                   and protections as part of a new Good
this was little more than a shameless tax            Work Commission, modelled on the
grab and a brazen attempt to nationalise             Low Pay Commission and outlined
a significant chunk of British business,             further in chapter three, with those
deceitfully sold as a plan to promote                rights negotiated between employers
employee ownership.                                  and trades unions.
    The cooperative movement is an
important part of Labour’s history and,              REIMAGINING THE STATE
despite its recent difficulties, the historic        Just as elements of the left need to
model of the Co-op remains a model for               accept that business and industry have
how some businesses can be run for the               a pivotal role in bringing about a fair
benefit of all. The country would benefit            and just society, so the right must

                                                13
FABIAN IDEAS NO. 651

understand the pivotal role of the state           high-quality hard infrastructure like
in creating conditions in which business           transport, housing, broadband and
and industry can thrive. This is not sim-          energy, as well as human infrastructure
ply about rehearsing the tired argument            like education, childcare, health, leisure
that there is no such thing as an entirely         and social care.
free market, and that the state needs to               It is no coincidence that the UK has
regulate effectively to ensure fairness            one of the most centralised systems of
and competition; it is about recog-                government in the western world and
nising the active contribution of state            staggering levels of regional inequality.
investment in infrastructure, research             The last Labour government delivered
and innovation, a case well-made by                an asymmetrical settlement that gave
economist Mariana Mazzucato’s work                 power to Scotland, Wales, Northern
on ‘the entrepreneurial state’.                    Ireland and London, but left the ques-
   Theresa May’s government accepted               tion of English devolution unanswered.
the need for an industrial strategy for            The next Labour government should
the UK, but the end product fell short             preside over the biggest devolution of
of the ambition established by its own             power in British history, shifting power
Industrial Strategy Commission. The                and resources from Whitehall out across
Labour party should take the final report          England as well as to the devolved
of the commission as the starting point            governments of Scotland, Wales and
for developing a new industrial strategy           Northern Ireland. While every citizen
for the next Labour government. As                 in every part of the country should be
Rachel Reeves argues powerfully in                 entitled to good standards of service and
her pamphlet, The Everyday Economy,                the same universal basic infrastructure,
the government’s industrial strategy               there is no reason to believe that policies
pays little attention to the services,             around economic development, health
production, consumption and social                 and social care, community safety
infrastructure that lie at the heart of our        and housing are better developed in
lives, from the low-paid service sectors           Westminster than in the communities
like hospitality and retail to areas like          that they serve.
transportation, social care and the                    More equitable public transport
utilities, which employ 40 per cent of the         investment across our regions is
workforce in England and Wales with                necessary but insufficient to make the
similar levels across the country.                 system work. London benefits from
   As Reeves argues, to meet the needs             regulated public transport answerable to
of the everyday economy, Labour should             its mayor through Transport for London
take up the challenge of the Industrial            and it is time elected representatives
Strategy Commission and create a plan              across Britain had similar powers, plus
guaranteeing every citizen in every                coordinating powers for organisations
part of the UK access to a universal               like Transport for the North.
basic infrastructure, going further than               In place of the lopsided approach
the commission proposes to include                 of the current system of English metro

                                              14
LET US FACE THE FUTURE AGAIN

mayors, there should be a consistent             over their own lives. The cynicism about
and well-understood model of local               whether Brexit really will give them that
power and decision-making developed              control is understandable, but these are
on a cross-party basis with the Local            positive aspirations. Surely the Labour
Government Association. An either/               party exists to make sure that we have
or contest between cities and towns is           a government that will make such
self-defeating when the opportunities            hopes a reality.
and lives of the citizens in both are so             Members of parliament, so
clearly interdependent. They must grow           often portrayed as out of touch, see
together and we should incorporate               the consequences of the failure of
learning about the ‘everyday economy’            the modern welfare state every week
to ensure our approach relates to the            through our constituency casework:
complexity of people’s lives as they             a social insecurity system that punishes
experience them and not as some                  and penalises the unemployed into
inconvenient data subset.                        further hardship, destitution and
   Without resources, devolved                   ill-health; health services that all-too
institutions will always be reliant on           often leave patients feeling like they
the centre. That is why sharing power            are being processed, rather than treated
must also be accompanied by a new                and supported; an education system
local government finance settlement              ill-equipped to provide personalised
agreed on three-year cycles to allow             support for children who need it;
for better financial planning and new            families pushed from pillar to post
revenue-raising powers in the hands of           and away from relatives and support
local decision-makers, including greater         networks in overcrowded, temporary
freedom to borrow to build new homes             bed-and-breakfast accommodation;
to meet local needs.                             refugees fleeing violence and conflict
   Reimagining the state is not just             in search of sanctuary enduring further
about devolving power from one set of            suffering and the indignity of hand
politicians to another, but about giving         outs because they are prevented from
people real control and agency over              earning their own keep. MPs see endless
their own lives and destinies. On the            examples of human misery at our advice
night Britain left the European Union,           surgeries, many of which are made
one abiding image was of two women               worse – not better – by their encounters
interviewed on national television               with the state. The professionals who
about why they voted leave. They were            choose to dedicate their lives to public
subsequently ridiculed on social media           service experience this failure, too.
for ‘not knowing what it was that they           It is why so many of them are leaving
had voted for’. In fact, they articulated        professions they spent time and money
clearly why they voted to leave the EU:          training to join.
they believed it would give our country              Part of the solution for our broken
more say over our own laws and they              social contract lies in restoring a social
believed it would give them more say             security system worthy of the name.

                                            15
FABIAN IDEAS NO. 651

In her report, Making Ends Meet,                  doing things with people, rather than
Alison McGovern identifies a series               to them or for them.
of immediate priorities to end the                    Labour doesn’t have to wait to be
need for food banks: ending the                   in government to develop some of
two-child limit in universal credit               these ideas into practical proposals
to restore support to 250,000 children,           for improving people’s quality of life.
reducing the waiting time for universal           Labour is already in power in commu-
credit payments, increasing child benefit         nities across England and Scotland, as
to lift 300,000 children out of poverty           well as nationally in Wales. We should
and investing in disability support               pioneer our new approach with groups
and childcare.                                    affected by what some GPs famously
    We must also ensure that people feel          describe as ’shit life syndrome’, ending
a sense of safety and security in their           the indignity and ineffectiveness of
own homes and communities. It is no               publicly funded service providers
coincidence that ‘tough on crime and              marching into their lives to do things
tough on the causes of crime’ was one             ‘to’ them. We should draw on the many
of the few New Labour soundbites to               examples of best practice identified by
make it into a Corbyn manifesto. It               Cottam, including working with people
speaks to the desire of the public to feel        to help them plan their own way out of
safe and to see criminal activity met             challenges like poverty, unemployment
with justice, but also their recognition          or underemployment, ill-health or
of the complex causes of crime and                their struggles to care for loved ones.
a belief that prevention is better than           We should innovate, experiment and
cure. Beyond criticising cuts to police           take calculated risks; scale up what
numbers, Labour has had little to say             works and learn from what doesn’t. As
on law and order for the last four years.         Cottam’s work demonstrates, this style
Labour’s new leadership should make               of delivery would be cheaper to deliver
this a priority.                                  but, more importantly, it would lead to
    Longer term, we must completely               better outcomes.
reimagine the state. In her widely                    Complementing this approach is
acclaimed book, Radical Help, Hilary              Mazzucato’s work on ‘mission-oriented
Cottam applies her experience of                  innovation policy’, which focuses on
working with UK families and commu-               big challenges that require system-wide
nities across the world to find ways to           transformation across different
return to the founding principles of the          industries and sectors and partnerships
welfare state – reinventing it for modern         between the state, private sector, third
times on the basis of building strong             sector and wider civil society. It rec-
relationships with people to help them            ognises the need for strong direction
lead good lives and flourish. Cottam’s            from above, but also the value of
work forms part of a growing call for the         bottom-up experimentation.10
state to be better at responding to the               The coronavirus pandemic is not
needs of people: showing flexibility and          simply a public health crisis, but an

                                             16
LET US FACE THE FUTURE AGAIN

economic one. Any pronouncement here            in precarious work should be seen as
on the short-term response needed is            a wake-up call to start preparing for
likely to be overtaken by events, but it        the challenges posed by the technolog-
is clear at the time of publication that        ical revolution that lies ahead, which
the demand and supply side shocks               chapter three considers. We can not
will be simultaneous and severe. This           afford to let this crisis distract us from
will necessitate a response more akin           the existential threat of climate change,
to wartime than the 2007–8 financial            so we must seize this opportunity to
crisis in terms of state intervention to        make our recovery a green recovery,
prevent businesses and entire industries        with the measures described in chapter
collapsing under the strain. The focus          four. Should anyone still be attracted
must be on saving livelihoods, as well          by the siren call of the populists
as lives.                                       and nativists, we must argue with
    If the coronavirus crisis demands           renewed vigour and conviction that
a wartime response, we should give              global problems require global solution.
serious consideration to the peace that         We need to rebuild global institutions
will follow. When future generations            to give people a sense of safety and
look back on our response to this               security in a dangerous world, just
pandemic, they should be able to do so          as chapter five suggests.
with the same pride that our generation             As William Beveridge said when
looks back on the legacy of the Attlee          his landmark report laid the foundations
government. It could be a moment                of the welfare state: “A revolutionary
that further entrenches inequality, or          moment in the world’s history is
it could be the turning point when we           a time for revolutions, not for patching.”
decided as a country to socialise risk          This is such a moment. It is time to
and to give everyone a stake in success.        commission a 21st century Beveridge
Never again should we fail older and            report to meet the future with a
disabled people by leaving them so              genuinely forward-looking plan to
dangerously exposed as a result of our          rebuild our economy, reimagine our
broken social care system. The level of         state and create a good quality of life
social insecurity experienced by people         for everyone in good times and bad.

                                           17
CHAPTER 2
                            OUR AGEING SOCIETY:
                             LIVING GOOD LIVES,
                            NOT JUST LONGER LIVES

   Policy-makers and broadcasters do             state is spectacularly ill-equipped to
   not talk about a flourishing old age,         address. We need to mobilise around
   much less enlightenment. Rather,              a plan to address this crisis today
   they routinely speak of ‘time-bombs’          whilst agreeing a longer-term strategy
   and ‘burdens’, of the ‘flood-gates’.          to meet the changing profile of our
   We need to reinvent.                          population over the coming decades.
   – Hilary Cottam                               To do this, we need to be brave, taking
                                                 on some difficult political arguments
Laying the foundations of our welfare            about how we build a society that cares,
state was a revolutionary response to            how we pay for it and how we attract
an epochal moment for our country. But           people from around the world to join
there was one area where the Beveridge           the UK’s workforce.
blueprint was entirely unrevolutionary,
even counter-revolutionary: the                  THE CRISIS TODAY
provision of care.                               The extent of the present crisis is well
   The founders of the welfare state             documented and the failure to tackle
didn’t worry about care because there            it is unforgivable. Over the course of
was already a simple answer: women               the last decade, the social care safety
would do it. While society as a whole            net has been gradually cut to pieces.
no longer expects women to live lives            Government spending on adult social
of domestic servitude, the reality is            care in England fell from an average
that where caring roles need to be filled        of £346 per person in 2010/11 to £324
in the family, women are still more              in 2017/18.11 Restrictive means-testing
likely to take up those responsibilities         and pressure to ‘deliver more for less’
than men.                                        have impacted on the availability,
   Britain is in the midst of a social           quality and consistency of care available
care crisis which the current welfare            in different parts of the country.

                                            18
LET US FACE THE FUTURE AGAIN

    The failure of successive governments         potential returners from care in the UK,
to adjust the 2010 means test means               91 per cent of whom are women. Tackling
people with property, savings and                 the social care crisis isn’t just about
income in excess of £23,250 must meet             providing people with the support they
the entirety of their care costs. As the          need; it is about unlocking the talents
Nuffield Trust reports, for some people           of people who could be in the labour
these costs can be ‘catastrophic’.                market, a disproportionate number
    Poor levels of funding are also               of whom are women. This is an issue
driving a staffing crisis. According to           of equality and social justice.
the Health Foundation, there are an                   Even if the objective were simply
estimated 110,000 vacancies in adult              a short-sighted commitment to maintain
social care. Staff turnover is high and           the status quo, the Health Foundation
the reasons for this are clear. Those             estimates that it would cost £1bn in
who choose to dedicate their working              2020/21 to address demand pressures
lives to caring for others face low               and staff pay, rising to £3.4bn in 2023/24
pay, poor working conditions and                  in comparison with the current baseline
unstable contracts, with nearly one in            budget. Restoring access to 2010/11
four workers on zero-hours contracts.             levels would cost an additional £8.1bn.
A noble profession helping people to                  But it is clear the status quo isn’t
live life to the fullest is currently seen        working for anyone. It fails those who
as a low-status career path.                      need care, with 1 million older people
    The economic value of unpaid                  failing to receive the support they need.
care provided by friends and family               It fails those who love them, as many
is estimated by the Office for National           of the UK’s 6.5 million family carers
Statistics to be £411bn per year, but             live in dire straits, with as many as
there are broader impacts on our society.         one in four having failed to get a single
Linda Pickard at the London School                day away from caring for five years.
of Economics has noted that carers are            This brings harmful consequences for
most likely to be of working age, with            carers’ own wellbeing. The system also
nearly two-thirds being women. BAME               fails care service providers who know
people, especially Asian people, are              their service provision is not good
more likely to provide longer hours of            enough, but who cannot make the
care. Age UK highlights that more than            changes needed because of the funding
1 million carers are ‘sandwich carers’,           constraints on their paymasters in local
looking after older relatives as well as          government. This stops them recruiting,
bringing up their children, 68 per cent           rewarding and retaining staff. The
of whom are women.12 For those who                system fails our society and economy,
take time out of work to undertake caring         as more and more older people end up
responsibilities, the return to work can          in hospital as a result of preventable
be hard and result in demotion. Taking            conditions and one-third of unpaid
all caring responsibilities together, the         carers end up reducing hours or giving
ONS estimates that there are 1.2 million          up paid work altogether.

                                             19
FABIAN IDEAS NO. 651

THE CHALLENGE AHEAD                                at not addressing the ’catastrophic costs’
The UK will have become the fastest                of social care. Theresa May’s manifesto
growing population in Europe by                    commitment to address the social
2030. The bulk of Britain’s population             care crisis was successfully torpedoed
growth will come from our ageing                   by Labour attacks on her so-called
population. One in three babies born               ‘dementia tax’. Following the election,
today are expected to live beyond 100.             those proposals were quietly dropped
By contrast, babies born 100 years ago             and a Green Paper announced in March
had just a one per cent chance of living           2017 has still yet to materialise after
to 100 years. The over-65 population               missing five publication dates.
will increase from 11.6 million today                  There is no shortage of ideas available.
to 15.4 million by 2030. By comparison,            The Dilnot Commission, which reported
the 16–64 cohort will increase by just             in 2011, proposed a range of measures
three per cent. This will place significant        to tackle the funding crisis, including
pressure on adult social care budgets,             a more generous means-testing threshold
as the working age population to pay               set at £100,000, a cap on care costs of
for it shrinks. IPPR estimates that the            £35,000, disability benefits to support
funding gap for adult social care will             independence for disabled people and
reach £13bn by 2030–31, which would                a national threshold for care eligibility
be 62 per cent of the expected budget.             to end the postcode lottery.
   These factors necessitate recruiting                The Scottish government provides
skilled workers from overseas – not just           free personal and nursing care following
to meet the skills needs of our economy,           a needs-based assessment to assist with
but to provide the tax revenues we need            a range of tasks from personal hygiene
to fund people in retirement. But as               and continence management through
we have seen in the UK and many                    to counselling and food preparation,
other Western democracies, people                  with chargeable services including
aren’t necessarily prioritising national           housework, laundry, shopping and the
economic interest when making political            costs of supplying food. The cost of
decisions and governments are begin-               implementing such a model in England
ning to follow suit.                               could add around £4.4bn to the social
                                                   care budget today,13 but this will still
FACING THE FUTURE                                  fall short of meeting people’s full social
During his inaugural speech as prime               care needs.
minister, Boris Johnson pledged to                     At the 2019 general election, the
“fix … once and for all” the social care           Nuffield Foundation called for clarity
crisis which has plagued successive                and consistency about the social care
administrations. Proposals put forward             offer, supporting calls for free personal
by Gordon Brown to introduce a levy at             care for over-65s; fair and transparent
death to fund social care were savaged             funding being shared between indi-
as a ‘death tax’. After he left office,            viduals and the state; and a workforce
David Cameron expressed his regret                 strategy to address the scale of the

                                              20
LET US FACE THE FUTURE AGAIN

shortage; as well as stability for organi-         to create something better in its place.
sations providing care.                            We should first decide what a social
    Labour’s manifesto committed £10bn             care system which enables people to
for social care and included proposals             live good lives would look like and then
for free personal care for the over-65s,           decide how we should pay for it.
a lifetime cap on personal contributions               Politicians regularly contribute to
of £100,000 and clear eligibility criteria.        political debates through the prism of
The funding commitments were widely                people’s lives: the people we meet, the
welcomed, but the pledge to repeal                 services we visit, even the experiences
the Health and Social Care Act was                 of our loved ones. But the truth is we
criticised for raising the spectre of              are not good at making policy through
another costly NHS reorganisation.                 the same lens and we are even worse
    In the social care debates of the last         at handing over power and control to
decade, short-term political opportun-             let people shape their own lives.
ism has trumped the national interest,                 If we start by wanting to help people
resulting in a failure to treat the crisis         to live better lives, not simply endure
with the urgency it deserves. The result           longer ones, we begin a different
has been human misery and indignity.               conversation and open new worlds
                                                   of possibility. Describing an initiative
PUTTING PEOPLE FIRST                               called ‘The Circle’, Hilary Cottam
Living longer should be a cause for                provides evidence that such an approach
celebration, untainted by expectation              works. Working with a range of older
of misery, fear or pain. Where people              people, some of whom were experiencing
are unable to work because of chronic              loneliness and ill-health, Cottam’s team
illness or disability, they should be              designed a programme of public action
actively enabled to live fulfilling lives.         that built connections, relationships and
As a society, we are far from realising            friendships – helping them help each
this vision.                                       other to lead better lives – from activities
    The social care crisis can’t wait for          like coffee mornings, book clubs, art and
a Labour government. In opposition,                cinema trips, to an advice line and a team
Labour’s new leadership needs to                   of people willing to use their skills to help
stress the urgent need to inject cash              with odd jobs. Each ‘circle’ of the project
into the system and tackle the recruit-            was funded with a start-up grant from
ment crisis immediately.                           a local authority or housing association.
    Longer term, any plan for funding              Cottam reveals that partners calculated
must find the right balance between                they would save more than £2m in
the contributions made by individuals              the start-up years, with approximately
and the state. But too often the debate            £800,000 in cash savings and the rest
starts and ends with a discussion about            made up from reduced demand for items
thresholds, entitlements and cash injec-           like unnecessary GP visits.
tions with the aim of propping up the                  ‘The Circle’ is an example of how
existing system, rather than an ambition           a new kind of sharing, relational

                                              21
You can also read