It is just over eight years since the Institute for Public Policy Research published the conclusions of its Commission on Social Justice. It was a truly landmark report, produced in opposition, and drives Labour’s social agenda in government. We all know it can become tedious when politicians quote endless lists of achievements but, eight years on, it is worth taking a look at what we have delivered – and where we need to do more – as set against the Commission’s bold ambitions.
A fundamental part of the Commission’s rationale was the need to use the welfare state as a springboard for economic opportunity. Progress readers will know that we have implemented much of the Commission’s suggestions for an investment welfare state through the New Deals, the focus on work in our benefits system, tax credits, and childcare investment, which has doubled.
The Commission called for radically improved access to education and training. We have achieved record spending on education as a percentage of GDP and now have universal provision of education for all four year-olds and are on track for all three year-olds. We have introduced the Education Maintenance Allowance, which provides financial support for poorer young people to stay on in education. We have delivered new investment in adult basic skills and developed pilots on incentives and tax credits for employers to encourage them to give time for training leave. We have introduced the UK’s first national minimum wage – as recommended by the Commission – and raised it four times. Crucially, over half a million children have been taken out of poverty since we came into power.
The Commission stated clearly that the strength of our country – the basis of national renewal – can only be realised by releasing the untapped talent of all its people. But here we still have much to do, most notably in the way government communicates and engages with people.
Government has to get much smarter about how it motivates and enables people to change. It has to learn to use ‘soft’ as well as ‘hard’ levers. That is why re-engaging people with politics, devolving decisions and creating new forms of popular empowerment are not separate from – or subsidiary to – our economic and social agenda. The reality is that only through popular empowerment and engagement can we fully achieve our economic and social goals. So our vision of the modern economy must, above all, be of a democratic economy, where people and their families have real economic power – individually and collectively – over their lives and the forces that affect them.
The first part of that vision is our simple belief in the equal worth of every human being. Everyone should be able to contribute to – and share in – rising prosperity. That’s why our achievement of getting an extra one-and-a-half million people into work since 1997 is not enough. Because in our most deprived areas, be they rural or inner city, unemployment is still unacceptably high. The people the Labour Party has always put first are still denied the opportunities that should belong to all of us by right. When black graduates are far more likely to be unemployed than their white counterparts we must go on fighting against the barriers that hold people back.
But the responsibility of the state does not stop when someone gets their first pay packet. Instead we must give help and support to all working people to achieve their full potential at work. Unions have a vital contribution to make to help and encourage their members to obtain the skills they need. The government does too. We are already piloting programmes that encourage employers to give their staff time off for training. But we can do more. The success of the New Deal for those out of work could be replicated for those in work. A national source of career advisers for everyone, involving unions, self-help groups and private providers as well as government, could give power to working people to shape their own future and strengthen our economy at the same time.
Second, we recognise that, in the words of Labour’s new Clause IV, by the strength of our common endeavour we achieve more than we achieve alone. Because we are social beings, our full development as individuals depends upon effective social institutions. Workplaces where people are treated with contempt – exposed to dangerous working conditions, badly paid and badly managed – deny people the basic respect due to every human being as well as the chance to find and fulfil their potential.
Workplaces that treat people with respect, build people’s skills and support effective team-working not only help people feel they are making a worthwhile contribution, but also create greater value – in a virtuous circle of better services and products, higher wages and higher profits or value for money. But it’s worth making our position clear: even if there were no evidence that treating people properly was good for the economy, we would still go down that path. Our public policy needs to recognise that business has responsibilities to its people as well as rights in the economy.
We are also clear that when the community works together, the result is better. As the Commission on Social Justice said, building strong communities must start at the bottom. That’s why we’re supporting new forms of ownership at grassroots level – be they in hospitals, housing, childcare facilities, parks or leisure services – and liberating the entrepreneurial spirit of individuals within public sector values. There’s no reason why, to take one example, a group of residents that cares about a local park shouldn’t actually own it, in trust, for the wider community. Social enterprises set up for profit, but with an explicit aim of providing employment and training in disadvantaged areas (like the Eden project), can transform the local environment. Community interest companies could be facilitated by government to provide a public service but be managed independently, so that staff on the front line are empowered to do more.
Third, we believe – and it is worth reasserting – that the state has a responsibility to act on behalf of all the people, in the national interest. Market fundamentalists talk as if ‘free markets’ require only the absence of government. The reality, of course, is that markets are the result of decisions taken over decades or even centuries by different economic agents and, above all, by governments. As the Commission on Social Justice said, intelligent regulation can help make the workplace and the economy more efficient and more just. A labour market can operate with or without a minimum wage, or decent standards of health and safety or employment protection, but the very different labour markets that result from these decisions embody very different political values.
The prerequisite of a belief in government action to shape the market is a strong private sector to create the wealth in the first place. Modern social democrats should therefore be able to take it for granted that our country needs strong, successful, innovative businesses – generating good jobs, creating the wealth that sustains public services and pensions, making people richer. We should be able to take it for granted that any successful, modern, social democratic government will support enterprise and entrepreneurs, and will want to create an environment in which more businesses start and succeed.
So these are the values that underpin our commitment to social justice. They are already causing us to challenge and change the distribution of power, putting working families first in everything we do. As the Commission on Social Justice stated in its very first sentence, releasing the untapped talent of all our people must be the basis of national renewal. So modern politics must be true to the democratic ideal – of the people, by the people, for the people. Only then will we achieve our vision of social justice in the 21st century.