Introduction

Many pamphlets will be written about the achievements and successes of the Labour governments from 1997-2010. But analysing where we failed is equally important. It is necessary that our party learns from its failures – necessary and easier than learning from successes! This pamphlet is not about apportioning blame for defeat. It is about how we can do better next time. It is about how we can prepare the policies that will give people confidence that we can once again be trusted with the responsibility and privilege of government.

The areas of government I have focused on are those where I claim to have some experience or a little knowledge. Others in the party will be better qualified to speak on issues I have omitted.

What they said on the doorstep

Political parties are about creating alliances: between people who are unjustly treated and those who recognise injustice and are willing to remedy it even at the price of some inconvenience to themselves. They are about presenting an attractive vision, not only about what you will get if you vote for a particular party, but about what sort of person you must want to be to live in a society governed in that way. If we failed to communicate our vision to the people who voted for other parties then we failed them.

But we failed them in a different way to the mother who lives with her daughter in bunk beds in her “auntie’s” back room. Her overcrowding was our failure. So too was the young woman whose CSA payments never arrived or the steelworker in County Durham who couldn’t understand why the banks had been bailed out but his steelworks was being mothballed. In a sense we failed everyone who said to us on the doorstep: “Why should I vote Labour when….?” and didn’t feel they got a satisfactory answer.

So what did people say on the doorstep? The list will be as long as the number of canvassers who purposefully trudged the pavements of our country those last months before the election and found an electorate no longer believing that Labour was the answer to their problems.

“Why should I vote Labour when I have been on the housing list the entire time you have been in Government?”

“Why should I vote Labour when you let all these immigrants in?”

“Why should I vote Labour when we’ve got the worst recession in 80 years?”

“Why should I vote Labour when the gap between the rich and poor has actually got wider?”

“Why should I vote Labour when you have done nothing to stop climate change?”

Not all the assertions contained in these questions are true. But they all reflect a truth, that our policies were not addressing people’s worries, their situation and their lives.

No doubt the clever candidate had a clever response to each of these questions on the doorstep. It is always tempting for a politician to tell the electorate that they are wrong, that they don’t understand. Ultimately though, the ballot box is the final arbiter.

Jobs and economic growth

In 2005 the Labour Party had gone to the polls with the proud message that we had presided over the longest period of economic growth since records began. No one suspected that five years later it would be precisely our economic failings that lost us seats like Redcar, whose MP, Vera Baird, was recognised as one of the brightest and best in the Commons. The global economic crisis was an election backdrop that no government would wish for, but the fact is that Labour was not punished by the electorate for this.

People were not blind to the fact that the global recession came from America. On the whole voters understood that the US sub-prime mortgage market had infected the global financial system. They may not have understood precisely how the securitisation of these mortgages had failed, nor how hedge funds had used short selling to drive down stock prices, but they were sophisticated enough to recognise that Gordon Brown had brought the world together at the G20 to stop the recession becoming a global depression. No, the charge that resonated most with voters was not that Labour was responsible for the recession, but that under Labour, Britain had stopped making things.

When Labour came into government in 1997 manufacturing represented 20.78% of the UK’s GDP. By 2008 this had fallen to 11.99%. In fact in nine out of the eleven Labour years for which figures are now available the value of manufactured goods produced was actually less even in cash terms than the £151.2billion in Labour’s first full year in government. When compared with the 62% rise in GDP as a whole, it is clear that this decline in manufacturing was a real sickness at the heart of our economy.

Labour failed to recognise this until it was too late. Even the industrial activism of Lord Mandelson and the new Department of Business Innovation & Skills from 2008 onwards was not enough to reverse this decline. We had become a government drunk on financial services whose contribution to GDP had more than doubled from £43.85billion to £110.14billion during the same period. That economic imbalance also was the reason for our unique vulnerability when the global recession hit.

Of course globalisation meant that our ability to compete in low skilled, labour-intensive manufacturing industries was increasingly improbable and undesirable. It never could have been part of a Labour government’s policy to compete in a downward spiral of poorer wages, terms and conditions against the cheap labour costs of South Korea, China and India. It should certainly have been the Labour government’s policy, however, to create a new generation of higher skilled jobs in electronics, optics, composites, engineering, and renewable technologies much earlier in the employment cycle.

The stimulus and growth package announced by the chancellor in 2009 in response to the financial crisis shows how unimaginative the Labour government was in this area. Even at this desperately late stage, just 6% of this financial package was devoted to green growth. Compare this with the South Koreans who devoted 69% of their stimulus and growth package to new green technologies and the jobs of tomorrow.

Our failure to spot this inevitable shift shows our disconnection from the concerns of the party’s traditional working class support. We had two million more people in employment than the country had ever seen before. That desensitised us to the steady rise in unemployment in the low skilled manufacturing sector. When challenged at the despatch box about unemployment, ministers saw no problem in reiterating the good news about employment rather than facing up to the reality that for those increasing numbers of people without jobs, record employment for others was no comfort, far less a solution.

Voters in traditional manufacturing areas could not understand how it was that we were prepared to pour the nation’s wealth into stabilising the banking industry but not willing to do the same for them. They felt let down and betrayed that we, the party of the industrial worker; the party established to protect their interests, had failed even to recognise that they were in trouble until it was too late.

Housing

It is easy to forget just what an appalling state public sector housing was in when Labour came to government. How capital receipts had been squandered on lowering council tax rather than spent on repairing stock. How homelessness and rough sleeping were a blight in every big city. Labour should have addressed the fundamental issue of numbers. We should have simply built more houses. But there were other things that went wrong.

In 2002 the Labour government passed the Commonhold and Leasehold Reform Act. It was a too timid piece of legislation that failed to deliver on the promise that the pamphlet “An End To Feudalism” had inspired around the country when Labour had been in opposition. It gave leasehold tenants certain new protections: major works monies to be held in security, the right to enfranchise, the right to appoint a manager or even to self manage. It did not abolish the hated “Marriage Value” which a radical Labour reform in the 1960s had abolished only to see Mrs. Thatcher reintroduce, nor did it create a framework in which commonhold became a respected tenure preferred by all new build developers.

Leaseholders still pay the full market price for their flat as if it were a lease with a share of the freehold. They still see the value of their asset diminish over time so that with less than 40 years left, it becomes impossible to raise finance on the property and prohibitively expensive to extend their lease. They still get exploited by bad landlords and find complex and confusing the Leasehold Valuation Tribunals that were meant to resolve disputes simply and cheaply. Leaseholders in former council property have been locked into a “Nothing Tenure” where they are not insulated from large financial outlay as a tenant is, but have none of the freedoms and choice that should come with ownership.

For some reason a Labour government believed that the way to improve service to council tenants was to transfer stock to Arms Length Management Organisations! We looked at dysfunctional Housing departments and were persuaded that the repairs and management would somehow improve if we allowed what was invariably the very same group of people to free themselves up a little from the strictures of local democratic accountability. Of course it allowed access to more money and eased the burden on the government’s net public borrowing requirement; but today when we consider the relatively paltry sums involved that must now appear somewhat hollow.

The provision of housing is fundamental to people’s health and well-being. Without the stable base of a secure home it is not just people’s physical and economic health that suffers, but their mental health. A major house building programme must be a bedrock of a truly Labour government.

The private rented sector has been artificially inflated by the lack of new build. You cannot expect population size to increase, household size to decrease and not expect private sector rents to rise. Not unless you build enough new supply. But as we saw the inexorable rise of landlords raking in ever higher rents from ever smaller housing units: converting family homes for 5 into Houses in Multiple Occupation (HMOs) for 15 and providing worse maintenance and repairs into the bargain our response was to increase subsidy to chase rents upwards. It should have been to regulate landlords much more closely, stop the Rackmanesque practices, and use the funds not to reward bad landlords, but to build homes and increase supply.

Immigration

The most corrosive of all political issues is immigration. Labour recognised that every successive wave of immigration into the UK has brought enormous economic benefit to the country. We were right to tell people that whether it was the Jewish refugees in the 1890s, the Irish road builders in the 1950s, the West Indian bus drivers in the 1960s or the Asian corner shop keepers from East Africa in the 1970s, each group had boosted our economy and often provided a willing workforce prepared to do jobs no longer attractive to existing residents. Our instincts and our analysis were right. Our policies were wrong.

People often imagine that our policies were wrong because they were too lax and favoured the immigrant or asylum seeker. The fact is that it was often the immigrant or asylum seeker that suffered most from these weak policies — trapped in a limbo where they could neither go forward nor back.

In 2002 an asylum seeker from Sri Lanka whose case I had been dealing with for three years came to me to ask if there was anything further that I could do. I explained carefully that she had now exhausted all possible appeals and that I could not help her further. She was, as the Home Office letter made clear, “a person liable to be deported”. In 2009 the same woman walked back into my surgery. The Home Office had taken no action to remove her from the country. Unsurprisingly, she had not simply booked her own flight back to a country where she feared detention, torture and rape. Despite not being able to work she had survived off the friendship and charity of other members of her community and now her case was very different. She now had children. With children and having established a family life in the UK, this woman was now able to submit a fresh and ultimately successful application on Human Rights Grounds for Leave to Remain in the UK.

I cannot estimate the waste in legal and court costs or the salaries of the scores of Home Office officials who had dealt with that case over the years, but I saw for myself the cost in human wretchedness that seven years of abject poverty had etched into that young woman’s face as she moved from the goodwill of one friend’s front sitting room to another. A decision to refuse leave to remain is of course a bitter blow to any asylum seeker, but failure to enforce a correct decision to refuse leave can have equally devastating consequences.

The points based system Labour introduced, ultimately controlled some of the non-EU immigration into the UK. It specifically did not remedy the problems surrounding bogus students. Many on student visas were hard pressed to remember the name of the college they were supposed to be attending. The student visa was simply the surest way to bring a spouse into the UK and whilst the student him or herself was only allowed to work up to 20 hours each week, their partner was entitled to work full time. The number of times that these visas were used simply as a means to access NHS services or to have children in UK hospitals was something that many of my constituents became acutely aware of and felt aggrieved by.

Often those who made this point most forcefully to me on the doorstep were themselves from first or second generation immigrant families. They were not being racist. Often the people they were complaining about were of the same race, the same religion and the same national origin as themselves. They were simply giving voice to what they saw as an unfair abuse of the system. Perhaps it was easier for them to do so without being accused of political incorrectness, but I have no doubt that many of their Anglo-Saxon neighbours felt exactly the same and expressed their discontent through the ballot box.

The key lesson we must learn is that it was not policy, but enforcement of policy that was the problem. It was not that we allowed too many people into the UK but our failure to deport those we said had no right to be here. It was not encouraging overseas students to support our higher education sector but our failure to insist that those who came to the UK to study, did so. It was not the granting of work visas but our failure to clamp down on the way that some immigrants exploited the system to secure benefits unavailable in their own country.

Immigration became an issue for those on the housing waiting list in particular. It was not that immigrants were given preferential treatment as was sometimes claimed. In fact asylum seekers were not even entitled to permanent housing. Only once a family had Indefinite Leave to Remain in the UK did they qualify for housing and then on the same basis as everyone else. But this was precisely the problem. Refugee families were more likely to have multiple and complex needs. Often health issues and disability as well as a large number of children would give new citizens more points on the housing needs register so that they would in fact qualify for housing very quickly and often before indigenous British families who had fewer children but had been on the housing list for many years. They were not given preferential treatment. The system operated the same for all. But the system did not recognise the importance of rewarding those who had been waiting for many years and felt they were being victimised in favour of newcomers who were jumping the queue.

The legacy here is a bitter one, because it bred resentment towards immigrant communities and contributed to the rise of racist politics and the BNP. Labour had the right instincts. Who would disagree that public housing should be allocated in accordance with need? But years of waiting gives its own entitlement and people need to feel that they are treated fairly. We should have recognised this.

Security and Civil Liberties

No first time voter in 2010 was aged more than ten when Labour came to office in 1997. They certainly did not remember Thatcherism seven years before that. The unemployment, bigotry and unfairness of those years was literally before they were born. So when asked to name the defining feature of Labour’s years in office, they did not think of the National Minimum Wage or gay rights, reduced hospital waits or pensioner credit. In fact they had only one overriding answer: “The Iraq War”. This is not to say that Labour lost in 2010 because of Iraq. Tony Blair had already won the 2005 election despite the huge backlash from the public over Iraq; but for new voters it was almost a mantra that Labour had lied and taken Britain into an illegal war and that we were a profoundly illiberal party that could not be trusted when we claimed secrecy in the cause of national security.

42 days, extraordinary rendition, perceived acquiescence over Guantanamo Bay, Section 44 powers, Jean-Charles de Menezes, ID cards, war in Afghanistan, war in Iraq; all these merged in voters minds to give the image of a government that was not prepared to use the power of the state to protect the individual, but to coerce individual citizens in order to protect the power of the state. This loss of trust was both fundamental and fatal.

As an MP who voted in favour of all of these, I believed that in each instance a sensible case could be made to justify the government’s position. Ultimately though, I recognise that the cumulative effect of all these policies has poisoned a generation of voters who began to see Labour as centralist and dictatorial in its tendencies.

New Labour had arrived as a government on your side: listening to workers at GCHQ, understanding the aspirations of “Mondeo man” and the individual; we ended up deaf to the concerns that essential freedoms were being traded at too low a price. After 13 years in office we were the establishment. If young Asians were being stopped arbitrarily in the streets, they did not think it was because the state wanted to protect them from further 7/7 attacks, but because the state had insufficient respect for them as equal citizens. Worse: the state suspected them as being sympathetic to and complicit in terrorism.

Even when the European Court of Human Rights ruled that Section 44 powers under the Prevention of Terrorism Act were being applied in an arbitrary and unlawful manner, Labour failed to listen and instead decided to appeal the ruling. Thankfully that appeal has now failed. How ironic that the new Conservative government outflanked us to the left by accepting it!

Environment

Internationally the UK was constantly in the lead on climate change and issues affecting biodiversity. At the G8 Gleneagles Summit in 2005 Tony Blair put climate change at the centre of the G8 agenda. The Stern Report followed this up with the first serious economic analysis of the costs and benefits of early mitigation action. Gordon Brown established the Congo Basin Forest Fund. Ed Miliband salvaged an Accord from Copenhagen in the dying hours of COP 15. David Miliband designated more square miles of protected area on the surface of our planet than anyone in history when he declared the Chagos archipelago in the British Indian Ocean Territory a complete “no take” Marine Protected Area. Here, surely then, the Labour government did not fail?

The truth is that our international profile was often not matched by our domestic action and instead of giving a lead to public sentiment and understanding, we often appeared to be lagging behind. The third runway at Heathrow and the 10/10 Campaign are just two examples of where our policies, however rational, were wrong-footed. Far too slowly did we accept the need for feed-in tariffs and a target not of 50% but of at least 80% by 2050. Certainly we put through two major pieces of pioneering legislation in the Climate Change Act and the Marine & Coastal Access Act, but we did not effectively manage to green other departments of state outside DEFRA and DECC.

New building standards do not insist on carbon neutral buildings. The Warm Front Scheme has insulated no more than a small percentage of the homes that need retrofitted to minimise energy loss. Utility prices have not been regulated to increase price with consumption rather than perversely rewarding those who consume more with a lower per unit cost. Subsidy for renewables has been inadequate to encourage even the level of new generation capacity required to meet our renewables targets, far less the shortfall in capacity predicted as the older generation of nuclear plants come off line and are decommissioned.

To many it was simply incredible that the car scrappage scheme to help an ailing motor industry did not insist that money was only available for a vehicle that was less polluting than the one being scrapped. How obscene that someone could scrap a 1.1litre Fiesta and get £2,000 towards a 6.8litre Bentley Azure!

Our party saw the environment as just another discreet policy issue like housing, education or transport. We did not understand and ensure that environmental policies were integrated in every aspect of government decision-making. In particular we did not create a post in the Treasury to regulate the spending of natural capital in the same way the Chief Secretary checks and approves each government department’s use of revenue and built capital.

Take the argument about whether government should spend £6million on research into fungal and parasitic diseases in honeybees. A prime candidate for government cuts as far as the Treasury was concerned. Yet the loss of bees as pollinators of crops leads directly to a loss of agricultural output from Britain’s farms and orchards. The Public Accounts Committee quantified the pollination services of honeybees as worth £200million to our economy each year yet there is no structural framework within government accounting that ensures these costs and benefits are properly integrated into the analysis of each department’s decision making.

The Labour mantra in 1997 was “Education Education Education”. Thirteen years on it should be “Environment Environment Environment”. As a party we must recognise this and make sure that we re-connect with younger voters who feel keenly that this is an issue for their generation.

Post Script

None of us enjoy being in opposition. We did not enter politics to criticise; but to do and to change. Over the five years of this Tory/Liberal collaboration we will have much to oppose and be critical of. But good opposition starts with self-criticism; with analysis of where we got things wrong in government and why we fell out of favour with the electorate. It is from such a base that we will be able to construct a new set of policies; effective and strong enough to meet the challenges of the UK in 2015.

This pamphlet is a contribution to that process of reconstruction. It is part of the journey we must now make back into government.