Anyone who spent time in Tory marginal seats knows that on one issue the polls were correct.
Labour lacked economic credibility with huge swathes of people we needed to vote for us. Labour lost twice as many voters to the Tories than to the Greens according to Electoral Calculus.
Liz Kendall’s major speech at Reuters earlier this week tackles the issue head on in a refreshing way which is long overdue in the party.
Kendall argued that there was nothing ‘Labour’ about racking up debt and spending more on interest than services like education.
When in power, it was Labour after 1997 who ran three surpluses and paid down the national debt releasing more money to spend on schools and hospitals.
Progressive politics justifies running a deficit in times of recession or crash. Smoothing out the downturn prevents unnecessary short term job losses and avoids a permanent loss of economic output – this is paid for by running a surplus in the good times. This return to core, traditional Labour values is necessary to regain public trust.
Second, she skewered the Tories rise in low paid jobs, arguing Britain has become ‘world class in creating low paid jobs, and second class on the jobs of the future’. Liz said that New Labour was sometimes too cavalier about this effect of globalisation, and thus Labour needs to foster a new partnership between the trade unions, business and finance. Employees need a greater say in the companies they work for, and to be empowered in their own training. Finance needs rebalancing towards long term investment in the economy, using new tools such as crowd sourcing where existing providers demand too much short termism.
One refreshing strand of argument which will be welcomed in our local cities and counties was a commitment to the devolution of powers, and also financing capacity. Council’s will be incentivised to work closer with growing businesses, allowing local authorities to keep a greater proportion of increased business rates.
The centralising tendency in the Labour party will not like this argument, but in practice where council’s, like my own, have been set free we have used our powers to boost the economy.
In Liverpool we have financed an extension to the Conference Centre – you may have been to Labour Conference there – to create an additional exhibition centre. This is booking up fast with international conferences boosting hotels, the visitor economy and the city as a destination – as well as providing additional business rate income.
Labour in local government has been responsible, successful and keeps winning elections – it deserves to be trusted.
Kendall also wants to devolve The Work Program budget to councils. This new approach is refreshing, and there is much we in local government can do to craft specific training for local boom industries, diving and offshore wind farm servicing are thriving here in Liverpool.
Crafting packages of land, training and local support will allow council’s to compete with other European cities that already attract investment by offering holistic packages to employers. The United Kingdom is currently 156 of 173 countries for business investment, this can only help improve our performance.
Kendall also advocates supporting companies who pay the living wage and providing employees with a real voice in how their companies are run – replicating the best of German manufacturing practice.
The devolution of power and reward to councils is a welcome, and long overdue, reflection that most of the successful innovation and delivery now takes place in our Labour councils. The speech advocated a combination of responsibility and progressive reform. Exactly the start of the long fightback which Labour needs to win the next general election.
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Paul Brant is a councillor in Liverpool
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