Redistribute . The mere utterance of this verb in a speech by the Prime Minister on September 18th was sufficient to cause a drearily predictable flurry of sensationalist headlines in the Tory papers threatening everything from renewed class war to imminent tax rises.

Yet as Tony Blair told the party conference less than a month later, we are at our best when we are at our boldest. So his September speech on tackling poverty should mark a new stage of a vital debate for the Labour Party about why inequality matters and why equality must continue to stand alongside liberty and democracy in the vocabulary and values of the left.

We live in a world scarred by both gross poverty and inequality. Half the people on earth live on less than two dollars a day and amidst all the breathless discussions of new technology s emancipatory power it is worth remembering that the whole continent of Africa has fewer telephone lines today than the island of Manhattan.

Here in Britain, we have thankfully moved beyond these absolute poverty levels that threaten life. But, as social constructs, poverty and inequality are manifested locally as well as globally. In my own constituency of Paisley South, despite real progress, too many constituents are still condemned to a daily rearguard battle for human dignity amidst the poverty, unemployment and damp housing that blights their lives.

And as these families will attest, such divisions of class are not new indeed inequality in one generation transmits itself into inequality of opportunity in the next. As the new schools minister, David Miliband, acknowledged recently, relative social mobility the chance of a son or daughter of a manual worker becoming a doctor, relative to the chance of the son and daughter of a doctor becoming an accountant has remained unchanged in 100 years.

So, in the face of such evidence, it is worth addressing the fundamental issue of how we understand equality, before asking amidst rising levels of prosperity does inequality matter? The starting point must be our values and what we want to achieve. The fundamental goal of politics is the organisation of society and the economy to ensure that people are able to realise their full potential. Even some of our political opponents would probably say the same. So how, then, do our prescriptions of the good society and the place of equality differ?

First and foremost, we believe in a positive notion of liberty, that the good society is achieved by empowering people to reach their full potential unlike the narrow Tory view of liberty from the state and isolated individualism. For while the right s narrow view of negative liberty as the absence of state coercion involves no necessity for fair distribution of resources and opportunities, the claim of the left establishes a clear and immediate link between liberty and equality. And if one accepts, as we do, that notions of positive liberty involve not only innate ability but also the associated resources and opportunities, then extreme differences in resources and opportunities have to be recognised as having a direct effect on levels of liberty.

As Michael Wills has observed recently, however, defining equality has tangled up generations of politicians on the left. All would recognise the equality of worth expressed through equality of suffrage and the equality before the law associated with citizenship. Similarly, equality of access to public goods such as education and health is widely accepted. Yet as Tony Blair told the Labour Party conference in 1999, it is now time to move beyond the false opposites of equality of opportunity and equality of result and develop a meaningful and realistic concept of equality that can guide our society in the years ahead.

This recognition of the need for a richer and more pluralistic notion of equality echoes Tony Crosland s earlier call for democratic equality whereby social institutions should be concerned with the fair distribution of resources as a way of securing a fair value for liberty .

That is indeed a radical prescription. The old left focused overwhelmingly on income now our ambition should be not merely to compensate people for their poverty but instead to tackle poverty s causes. Indeed, a more pluralist understanding of equality for today s society would also encompass wider policy issues such as discrimination and the environment: poor kids are seven times as likely to die from a car accident as their rich counterparts even though their parents are far less likely to own a car.

Such a view of equality must be advanced in a context of contemporary electoral and market realities by combining a commitment to the politics of distribution with a commitment to the politics of wealth creation and production. For while the British public retains a deep commitment to fairness and expects greater clinical need to be prioritised by the health service, they also expect harder work or greater talent to be recognised in the marketplace. So an understanding of and commitment to equality is not merely a matter of philosophical interest but has a direct relevance to immediate and important political challenges facing Labour.

Three brief examples are sufficient to illustrate this point. First, equality matters to our economy. It answers the new challenge of the 21st century how to harness and then develop the talents and skills of all your people as human capital becomes the new commanding heights. In this new global economy, where there is hardly a good or service that is not now subject to international competition, neither companies nor countries can afford to ignore the potential of a single individual. That is why not only education policies from Sure Start to university expansion but also tax and benefits policy from the New Deal to the Working Tax Credit must provide new ladders for people to develop their potential.

Second, equality matters to our society. It sustains the relationships that do not rest on the basis of power or exchange. It sustains a sense of shared citizenship that challenges a hegemonic view of the market as the measure of all worth. Take just the most obvious example. At best, our public services from our schools to our hospitals represent social structures of togetherness which, in Tawney s phrase, strip inequality of its esteem . They reflect the moral notion of equal worth that, notwithstanding their low income, even the poorest in our society stand in a position of equality with others who may be richer, luckier, or simply more privileged, due to our mutual and reciprocal dependency and duty as social beings.

Finally, equality matters to our politics. It allows Labour the opportunity to articulate the moral foundation of our cause. As Michael Jacobs has argued recently: Political activism designed to benefit oneself and one s narrow social group carries no particular ethical value. What gives politics its claim to virtue is its orientation towards others& to enlarge the consumption of the already comfortable is not a goal to make the political heart beat faster.

Of course politics is, and will remain, the art of the possible but today we have an unprecedented opportunity to change not just the electoral map but the political contours of our country by using the public square to articulate the difference between what is and what ought to be. It is hardly a new insight. Two decades ago, Margaret Thatcher recognised that boldness was not defined solely by changing policies but by changing minds.

Our challenge, therefore, is not to inhabit the centre ground but to shift it. Already, since the election, the debate about taxation and spending has moved on. Now we have the opportunity and responsibility to ensure that so too does the debate around inequality.