LET US FACE THE FUTURE AGAIN - WES STREETING MP - Fabian Society
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LET US
FACE THE
FUTURE
AGAIN
WES STREETING MP
FA B I A N I D E A S N O. 6 51Fabian 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
2LET 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
3INTRODUCTION
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
4LET 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.
5FABIAN 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.
6CHAPTER 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
7FABIAN 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.
8LET 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
9FABIAN 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
10LET 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
11FABIAN 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
12LET 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
13FABIAN 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
14LET 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.
15FABIAN 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
16LET 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.
17CHAPTER 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.
18LET 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.
19FABIAN 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
20LET 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
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