Saturday, 6 June 2009

Two hidden stories which could transform British politics

Hidden amongst the noise and disruption of an astonishing day in British government are a couple of fascinating stories which have the potential to form the political landscape for years to come. But there's almost no time to act: the government must take steps within 48 hours to avoid being overtaken by events.

The first story is the reshaping of the Cabinet into three new "councils". These are:
  1. National Economic Council: Economics and enterprise
  2. Democratic Renewal Council: Constitutional and political reform
  3. Domestic Policy Council: Public services
These three new groupings provide a structuring framework for most of the Cabinet, with the exception of foreign, defence, European and international development policy - which may be a candidate for a future fourth council.

The second story is Brown's appointment of more people from outside the House of Commons as ministers - Alan Sugar being the most visible - and his statement in today's press conference that we can expect more appointments in the near future.

Combined, these two changes could have as big an impact as Blair's "government by special adviser" which helped him so powerfully set the agenda in the first few years of his premiership. Perhaps Brown might have made these changes sooner, but that's academic - and he still has a year, plenty of time to create real change through these two new mechanisms.

So what impact will these changes have?

First, the councils will provide a simplified framework for the message of the Brown government. Three clear themes which can be repeated and deepened over the next twelve months: an economic policy to ensure a continued recovery from recession, fundamental reform of the constitution and the political environment, and a government which aggressively takes the citizen's side in a public services revolution.

Despite past criticism of Brown's alleged lack of vision, it is possible to discern a very clear theme in the last two years: urgent and overwhelming action to rescue the country from a financial and economic crisis. While this emerged more out of circumstance than deliberation, the prime minister has been the world's leading figure in taking the crisis on. And despite some public discomfort with the levels of public debt and money supply growth that have occurred in the last year, the consensus opinion among economists is that it was exactly the right response to the crisis.

And the next steps in the shaping of the government's message are important. Recovery from recession must still be the key message around which Brown builds his next twelve months, because it's his main political asset. But by the time of the election, that story will mainly be about an achievement already won (if it's not, then he has little chance of re-election) so the conversation must be broadened in order to create a credible electoral platform. The three councils provide the structure for that conversation.

Second, the development of clear policy strategy in each of the three areas is crucial.

For the economic council: Recovery must be built on a growth in productivity as well as demand, so that government debt can be serviced, and fiscal and monetary balance restored, in a way that's politically acceptable to the public. This is the impulse behind the appointment of high-profile figures to the economic council, and the elevation in Lord Mandelson's status - it is surely an important signal that the Business Secretary has been made de facto deputy prime minister.

This is an area that Brown is familiar with, and it has come up many times in his political life - since the early 1990s before Labour was in government. The productivity of the British economy has grown since then, though the role of the financial sector in that increase is controversial. In any case it must be complemented in the future by other sectors, with the goal of increasing the trend rate of productivity growth from 2% to 3-4% for a decade at least. It's time for ambitious actions to increase productive investment and structurally improve the UK's productivity - and the new council must move quickly to bring expertise both from business and from the economics profession into public policy.

For the constitutional council: the task is partly about representation, equity and justice, and partly about public perception of politics.

For politicians to take the bold steps that are demanded by a fast-evolving society, they must have legitimacy. The public delegate their authority to representatives in a temporary compact which notionally reads like this: act in our interests and we'll trust you to hold power for a while. But an underlying, perhaps more fundamental, message is: be a symbol of how we see ourselves, and we will ask you to make us better people.

This is the nature of the insult that many people feel they've received from MPs recently: they have betrayed us by acting like normal people instead of the idealised figures we wish they - and we - could be. And so the moral authority to help the rest of us be better than ourselves has been diminished. I don't personally think this attitude is particularly fair to MPs, but perception is more than reality in this area.

So the constitutional council has a mission to restore faith in the character of politicians. And one way it can do this - although perhaps too radical for a first step - is through self-sacrifice. If a Labour government were to create a political system not structured around its own political objectives but those of democracy and of a fair representation of our diverse population, it would win huge credibility from the many people who are disillusioned with politics and with the government, but who are not impressed by the alternatives on offer.

Of course such an action would strengthen the Liberal Democrats politically - but more at the expense of the Tories than Labour. Labour would be unlikely to win an election under PR, but it might have a decent chance of being the largest party - and it would probably stop the Conservatives from gaining power for a while at least. The task of winning the Liberal Democrats' trust in forming a coalition would be transformed if Labour were to implement PR; and even if this were not achieved and a Conservative/Liberal coalition resulted, it would be seen as an honourable outcome for the final year of a Labour government. Brown would leave power having made a bigger impact on the future of British politics in three years than Blair did in ten.

But if that is a step too far for today, completing reform of the House of Lords will be an easier task and possibly a higher priority - and probably a task that Jack Straw would enjoy finishing. In addition, a restoration of local government power would be a good way to increase public trust in a political tier they can feel closer to.

The public services council faces the greatest political challenge for a Labour government, but it's one that perhaps only Labour can succesfully tackle. Brown once had a reputation for prudence - remember her? - and could have again. My own feeling is that public services will thrive best when power is placed in the hands of their users - devolving the task of achieving better local services to those who can most directly apply the pressure. One challenge here will be to combat the tendency for middle-class users to gain the greatest power over and access to public services. It will be impossible to eliminate this effect but it can be reduced.

Again there's a question of public perception in this area: public services are by most objective measures better than they've ever been. But this is not the impression that many people have. And a Labour government - still the only party committed to the interests of the worst-off in society - needs to find the way to demonstrate these improvements.

Just as it is in the private sector, productivity is a concern in the public sector. This doesn't only mean a higher quantity of outputs in a fixed time: it also means generating outputs that better serve people's needs. Once again, allowing the users of the service to determine and communicate those needs is the best way to achieve this.

And if public spending does need to be cut in future - which most economists think it will - it is better done with power in the hands of its users rather than its providers, as this will focus institutions on their most effective services as perceived by the public.

Third, the growing presence of outside experts in government - Ara Darzi, Paul Drayson, Mervyn Davies, Shriti Vadera and now Alan Sugar among others - is an opportunity and also a risk. The opportunity comes from bringing outside expertise into government, which allows policymaking to be more accurately aligned with the objectives of society and the economy. The risk is that unelected peers have less legitimacy than MPs, even though technocrats can appeal at times when career politicians are perceived as tarnished.

Both of these factors suggest a move towards a more American style of government, with appointed cabinet members and stronger legislative scrutiny. Ministers do appear before select committees at present, but they rarely have to persuade a large number of MPs of the merits of new legislation - unlike in the United States where no bill passes without balancing the concerns of a majority of representatives.

The US system has flaws too, of course. But the new council structure has the potential to reinvigorate Cabinet government, shifting the details of policy from Number 10 but paradoxically strengthening the leadership role of the prime minister. And a strong legislative body, elected proportionally, scrutinising a Cabinet of apolitical experts heading executive departments, would be a truly new and positive change to British politics.

So what's the urgency?

Apart from the fact that only a year remains in the current Parliament to make all this happen, there is an impending deadline. A truce seems to have been called within the Labour Party until Monday, while MPs await the results of the European elections. Gordon Brown must take advantage of this two-day gap to take the initiative in all three policy areas. If not, Monday will bring more rumours and the story of the next few weeks will be all about a potential leadership challenge. Even if none materialises, the momentum will be gone.

The message is already at risk of dilution - Saturday's newspapers are still talking about plots and asking whether the reshuffle was as radical as it could have been (that is, as radical as the media would have liked - since promotions and sackings are much easier to report than a reconfiguration of Cabinet influence). What has been missed is that the changes in structure of government are more important than the reassignment of personnel.

But if each of the three Cabinet councils announces bold proposals in its own area - or if one makes a start and signals that the others will follow - the news agenda can be shifted onto substantive discussion about real changes. Each council will need its own strong leadership - presumably Straw on the constitution, Darling on economics and perhaps Ed Balls on public services. Mandelson would coordinate the overall strategy while Brown himself articulates the vision and provides the authority to see the changes through.

The next forty-eight hours will be critical to the birth of this process. If the right momentum is created, the force of renewal will give Labour its best chance of winning the next election - and the UK its best chance of making social and economic progress for the next twenty years.

11 comments:

WillORNG said...

One litmus test will be whether action is taken that benefits the country even if, in the short run, it hurts the Labour party.

One micro-structural example is making each constituency the same size and making more of them genuinely 'up for grabs', 21st Century Red/Blue forever seats aren't good for democracy and pander to party grass roots extremists.

Maybe an stv setup where each MP has to get 50%+1 minimum votes would be more democratic, too.

This would transfer power away from Labour to the other parties, particularly the Tories with many more votes needed per MP than for Labour in its decaying heartlands, but also to the Liberals, allowing them to moderate the worse extremes of Labour/Conservative but also bringing a welcome social liberalism/anti-authoritarian anti-dote to the centralising tendencies of Blue/Red.

www.politicalcompass.org is good on the social dimension to 21st Century politics, when the economic one has narrowed on the economic right.

WillORNG said...

PS by same size constituency I obviously mean in terms of electorate not anything else!

Leigh Caldwell said...

Interesting point. The constituencies at present are drawn by the independent Boundary Commission (part of the Electoral Commission), but there's quite an interesting history of obstruction of new boundaries by Parliament. Also, local geography and county and borough boundaries are a legislative constraint on equalising the population across constituencies.

Although the social or political makeup of local populations is not an explicit criterion in creating constituencies, it may well be an incidental outcome of the other criteria that are used. At least we don't have that grubby aspect of the American system, where state legislatures gerrymander the Congressional boundaries according to who has political control of the state. Even where this doesn't directly change the Republican/Democratic balance, it has often been used in the South to control the number of black and white representatives at Congressional or local level. A friend of mine who was a county commissioner carried out a long (and so far unsuccessful) suit under the civil rights legislation to try to stop this from happening in Georgia.

There is an argument for designing constituencies so that their population are socially, demographically or economically similar, so that their likely policy preferences can be accurately represented by a single MP. But this may conflict with achieving the most democratic option at the national level. There isn't one obvious solution, which will make it hard for the government to come up with a good, clear and decisive policy solution within a year. Then again, they must have had people thinking hard about this over the last decade.

WillORNG said...

Thanks.

I'm mindful of the American experience where it's heavily politicised, they think democracised, when it should be a technocratic matter.

Also the time delay of migration south and in constituencies changing quick enough to keep up with today.

Zen said...

Excellent post, pity we don't see this kind of analysis and insight in the mainstream media.

Although as it's now Monday morning and GB's lot has got even worse over those 48 hours, wouldn't expect the papers and TV to do anything as subtle as examine policy issues and constitutional reform.

Low turnout and the rise of right and centre-right parties speaks volumes about the disillusionment of the British public (and their short memories) but does provide an opportunity to open a genuine national debate about PR and how such voices are accommodated in a democratic society.

If only we had one...

Chris said...

I've never read such utterly misguided nonsense!

Ok, there are a few good ideas, but what you fail to point out, and what is the fundamental failing of Gordon Brown, is that spending does not equate to delivery.

Everything Gordon Brown does is either marketing or spending. He is a typical old-school public sector manager, who measures everything in terms of how much he spends.

You allude to this in your reference to his response to the financial crisis. Except that it is not widely accepted by economists that his response was correct. Indeed there has been widespread criticism of his almost uncontrolled increase in government debt. Though you can see why he did this - he knows he won't get re-elected, so why bother to safeguard the country's future. And why did he not cut taxes for his 'fiscal stimulus'. It's hard to see really where the money he spent has gone - I didn't get any. I don't know anyone who did.

The division of the cabinet into groups is just PR - it's not going to change policy. Who cares how they are grouped. If they don;t already work with each other effectively, they should be sacked. You shouldn't need to 'group' cabinet ministers to get them to work together effectively. Then again he needed a story.

I'm sorry to say, you have been taken in by the government's own PR machine. Like many, you have looked at what they have said, and thought 'yeah sounds good' without actually considering anything else.

Lok at the wider picture and most intelligent people can see that Brown has:
- messed up on bank regulation
- messed up on safeguarding our economy against recession
- dithered and spun, while producing no significant policy improvements that benefit the country

I won't say anything about employing his mates at taxpayers' expense.

Forget him. Dump him. This country needs rescuing urgently before Brown ruins it completely - whether it's by a new Labour leader with vision and honest, effective ideas, or a different party in power, it needs something that isn't Brown and that's for certain.

Leigh Caldwell said...

Thanks Zen and Chris for your input.

Zen - we might get lucky, if the PLP meeting this evening goes OK and the coup gossip calms down over the coming days, there will be an opportunity to debate more substantial matters. I guess we can all contribute - if nothing else, by writing to the letters page of your preferred news outlet and requesting it.

Chris - I agree about the distinction between spending and results, which is what I intended to convey with the point on public sector productivity.

While I don't hide the fact that I'm a Labour supporter, I am under no illusion that they've done everything right in the last twelve years; hopefully this article can be a contribution to some ideas about what to change while there's still the opportunity.

And of course there are plenty of voices who think the increase in public debt is too high - but I stand by my belief that most professional economists (as opposed to commentators in newspapers) believe the UK and US government's responses to last year's crisis were correct. Today's suggestion by the FT that the economy has probably started growing again is a provisional endorsement of that.

Could Labour do better under a different leader? I'm not sure. A lot of the criticism in the last two years has come from people in the media who want to confirm their own story about Brown and the government. I don't criticise them for that, it's simply a combination of human nature and the business model of running a newspaper. And the government should have been better at responding to and shaping that story, in which case they'd have more moral authority and in turn be able to do a better job of governing. One example of Brown's complicity in that story is that he might have felt the need to draw a clear distinction between himself and Blair by slowing down public sector reform. If so, I think that was a mistake. But that doesn't necessarily mean that replacing him now would make the difference.

If we do get someone new, they would probably be under immense pressure to call an election right away. That would indicate that the party should wait for 6-12 months before doing such a thing. By that time, it will also be clear whether Gordon Brown has regained the confidence of more of the electorate - in which case it might be better to stick with him after all.

On the other hand, you might be right - maybe I am just too loyal. In any case I believe it's never too late - policies and people can change, and whatever has been wrong in the past, our decisions should be made on the basis of what we think will be done in the future.

Anonymous said...

Just a re-hash of the existing Cabinet Committee concept.

Very very surprised if it is nothing more than the standard New Labour review, task force, etc initiatives we've all got used to seeing these last 12 years.

There just needs to be a clear out of the old players. Either the Labour party or electorate to provide.

WillORNG said...

Zen.

There's plenty of good commentary in the weekly press...

I firmly think we get the media we deserve...if we buy or read the celeb obsessed trash, what do we expect?

People who just supinely take what politicians and media offer without contributing worthwhile analysis are complicit.

Chris.

I'd agree, the problem we have is that Crash Gordon Bruin's Public Spending Boom was unsustainable and largely unproductive. A true Keynesian would save in the good times to cushion demand shrinks in the bust/crash...curiously greater numbers of two/thirds and intermediate economies, i.e. Chile, have managed to do this, so why couldn't Dear Prudence?

Zen said...

@WillORNG

Totally agree, I'm sure there's geat commentary out there, trouble is a very large chunk of the electorate (perhaps even the majority) don't even read "below the fold" or hear anything beyond the first five minutes of the News at Ten.

People won't start thinking about bigger issues until the politicians and the "headline" media decide that's what they're going to focus on, instead of indulging in their own little circus.

There's always good debate to be found for those prepared to put in a little effort, but the lowest common denominator white van man government returning Big Brother obsessed disengaged majority don't fall into that category.

Not only do we get the media we deserve, we get the government we deserve and the society we deserve.

I despair. Rant over lol.

WillORNG said...

Maybe it's something about being British and getting older, I 'rant' far more these days.

There is a great opportunity here, people are getting a little tuned into politics and aware it makes a difference.

What's needed is for thinking people to get out there and communicate/critique what's going on positively and putting forward a genuinely socially and economically progressive agenda based on personal AND social responsibility.

The state IS too big and ineffective, look at the ONS report on declining productivity...GPs and Consultants snouts in the trough on >100K a year for less hours...talk about unproductive? What a cruddy contract deal whoever did that's responsible for.

Beyond a basic health care safety net, expensive enough, leave it to people to choose insurance in a competitive health care market, why should the state be the sole provider? The NHS is too big to work well, break it up into regional units, whatever's necessary, answerable to consumers.

Take the abject failure of education; so many functionally illiterate/numerate/mediate feeding into a multi-generational welfare trapped under class...we can't afford it socially or economically.

There's plenty of examples in Sweden and the Netherlands to name but two of ways the state can fund but not produce/provide education/health services.