Giving people more power has always been a central principle of the Labour party
Despite the unlikelihood of such a whopping majority, we’re bound to hear a lot of talk of 1945 in the coming months. This is fair, since that year set the tone of much of the way people view Labour. And since the Second World War, Labour has basically been synonymous in the public mind with big government. The party has alternated between rejecting and playing upon this perception, but it remains ingrained.
Here we have a kind of brains trust view of Labour history; where generations of central planners from the Webbs to Clement Attlee to Gordon Brown worked out what the nation needed, moved some resources around like a giant game of Risk, and Valhalla ensued.
But the truth is rather more nuanced. As Liz Kendall and Steve Reed have noted in Progress’ recent report Let It Go, this is not a one way street and ‘giving people more power… has been a central principle of Labour politics for as long as our party has existed.’ Quite.
In any case, even if money was not an issue, our circumstances were quite different. In the late 1940s life expectancy stood at 66 for men and 71 for women, and funding the retired for the few years of post-work pensions they might expect to draw down on meant parting with less than a tenth of total government spend. Over the intervening period this proportion has doubled – and will only increase as our population ages and the ‘triple lock’ takes hold.
Likewise, the NHS as it emerged under Bevan could also be geared towards tackling the symptoms rather than preventing the causes of many a malady. Targeting resource to deal with work based injuries and patching up the elderly were always difficult challenges for the new health service, but at least they were relatively consistent ones.
With a still malnourished population feeling the effects of rationing, obesity and associated conditions were a much rarer set of phenomena in the age of Morrison. The times have clearly therefore changed, and the state must change with it.
Besides, the story of Labour as profligate spenders and Whitehall micro-managers is generally overly simplistic anyway. In the late 1960s the private sector was delivering over 200,000 new homes each year on its own. Likewise, full employment was delivered in a state making an advance from constituting around 35% of total national economic activity in the 1950s to around 43 per cent by the mid-1970s – hardly Soviet proportions.
Over two decades later Tony Blair oversaw a level of government spending between 38 per cent and 41 per cent of GDP during his premiership – again delivering close to full employment. In fact Labour have only truly turned the taps on to hit the mid forty per cents when the economy has hit the fan – from 1974 and 2008.
So, for one, let us look beyond ‘Bill Somebody’ and towards the report Bill Thomas actually wrote for Labour’s Small Business Taskforce. His recommendations included increasing the state’s procurement of small business, aligning skills provision with local need, and an Anglicised Sparkassen model of local banking. There’s a strong story here of partnership between local business and local democracy that Labour can build upon. As the aforementioned Progress analysis points out, it is positive that Labour councils like Oldham and Newcastle are making such progress in areas such as social care and troubled families.
This good work should be rewarded – not just with one-off payments by results programmes to fix an immediate need, but proper devolution to see us address the root causes and not just the symptoms.
And, to be fair, Labour have shown signs of getting all this. For one, Chuka Umunna’s backing of Local Enterprise Partnerships is an undersold achievement of this parliament. Labour are supposedly anti-business, but have pledged to hand down £30bn worth of capital to such institutions whose boards are comprised of 50 per cent + 1 private sector membership.
There is a need to align intent with form here, and Localis will consider such questions in a new report to be published next month. LEPs will need to evolve in terms of transparency and accountability, but they do provide a potentially crucial fora to embed collaboration at the local level.
PFI may have soured people on outsourcing huge Whitehall contracts, but getting the private, voluntary and charitable sectors to assist local authorities in service delivery as and where they can provide additionality is certainly no bad thing. How Labour councils have done this creatively during this parliament should be on the briefing notes of many a frontbencher about to rock up to the Newsnight studios.
In short then, 1945 was a watershed moment in Labour’s history – the major achievements of which are rightly praised. In 1951 Labour lost power but won the argument – Anthony Crosland famously asking himself in Future of Socialism whether mid 1950s Tory Britain ‘was still [1930s style] capitalism?’ and answering ‘no.’
But crucially this didn’t just mean that the Tories acquiesced to gradually increased spending. That was part of, but not the complete picture. 1945 was also an austerity parliament which ended with Labour spending around 36 per cent of GDP (including of course huge war debts) – there was room on which to build therefore.
But 1945 wasn’t just about new social institutions. It was a parliament which created the Industrial and Commercial Finance Corporation to ease credit to small business, and the Finance Corporation for Industry to do similar for larger enterprises. And it was a period which had to deal with a sluggish construction sector – which, together with that ultimate state intervention of rationing, created the perception that maybe big statism was not everything, and paved the way for a Conservative victory.
There are many lessons to take from it. Clement Attlee delivered for his time and, if he can learn the lessons from the multi-faceted nature of Labour’s history, so too can Ed Miliband.
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