17 May 2010
On Thursday 20 May 2010 and in the aftermath of the general election defeat, the former Chief Secretary to the Treasury and MP for Birmingham Hodge Hill, Liam Byrne, gave a keynote speech to the Demos Open Left Project on ‘How Labour Wins Again.’
THE BATTLE FOR THE CENTRE-GROUND
It is very nice to be here; in this new phase of my political life, I’m putting much less in writing and much more in speeches.I am very grateful for the chance to set out: a few reflections about why Labour lost office; and a few thoughts about the path back to power. Today has been a day of declarations. I’m pleased to say this is no declaration of an ambition to be my party’s leader. But it is a statement of the ambitions I think my party’s leader will need.
My argument this afternoon is simple. We’re now in a full-on fight for the centre-ground of British politics. And to win Labour must transform our programme and our party. Today we see the details of the coalition’s plan of work and when we see Mr. Cameron and Mr. Clegg together, it is clear that what began as a meeting of motives has become a meeting of minds and is rapidly becoming a merger. For Mr Cameron, this is a marriage of significant convenience. For 4 years, he looked behind him at the unreconstructed Tory party on the green benches and concluded to himself; I am their leader. I must follow them. It was a strategy that left the public somewhat unconvinced that the Tories had much changed. But now he sees his chance to claim the middle way of British Politics for him-self. The Liberal makeover of the Tory party Mr. Cameron was unable to effect in opposition he now hopes to assemble in office. So for Labour there is not a moment to lose, the warning signs are clear. The fight for the centre-ground of politics is about to get ferocious . Yet this is a fight we can win. But only if we learn the right lessons from defeat. And make the right decisions for the future. So, I want to start with a quick review of the signals the voters sent us in the final vote.
THE 2010 ELECTION
There are many in my party who are upbeat about the uphill battle we now confront. They are not entirely wrong. Our values are strong. Our supporters are determined. Our unity is in rude health. We combined at this election our traditional strengths and modern advances. In six of Britain’s regions – in the North West, in the North, in Yorkshire, In Scotland, Wales and London – we won. But we sustained too our appeal to the better off at the level we secured in 1997. That is why I say the wide and powerful New Labour coalition of 1997 has not crumbled. But we cannot kid ourselves about the damage. We lost almost a million votes since; 70 of the seats we won in 1997 fell. Just 258 Labour MP’s were returned – 13 less than in 1992 and 47 fewer than the Tories. In Southern-Eastern England, we have a huge task ahead. Our share of the vote fell by a third, to 16% of the South East. Across the entire sweep of the south of our country just 10 MP’s, sustained by a combined majority of 35,500, fight the Labour corner. In the North West, the North, the West Midlands and in Yorkshire, we lost seats outside the cities, in smaller towns and suburbs, as our share of the blue collar vote fell a full 20%. Amongst hard-working, aspirational families on modest to good incomes, our appeal has fizzled. Tomorrow, I will set out my own detailed view of results up and down the country. I am grateful to Progress for offering to publish that. But I think we can already conclude would-be Labour leaders now confront three facts of life.
THE ESSENTIAL CREDENTIALS
First, the right plan for reducing the country’s deficit remains the essential credential. The truth is, despite my good-hearted advice to my successor, Labour was right to act to protect jobs and businesses from the full force of the economic storm. Yes, in the short term it cost us. But in the longer term, the savings are immense. The reward is unemployment in this country that is 2% lower than either the Euro-area or the US. That’s a short-term saving of billions of pounds a year and it is a long term saving of the scars of social breakdown that we saw in this country in recessions of the past, and which haunt some communities still. But, the politics of the long path back to economic vitality will dominate Westminster for the months and years ahead. Next week, we will begin to see the colour of the coalition’s approach. I think I know what we can expect. Coming our way are cuts of £6 billion, allegedly on top of the £15 billion in the efficiencies Labour already asked departments to secure. Now we have already heard the coalition’s ideas to pack the Lords and fix the commons, so it becomes almost impossible to fire the government, no matter its performance. But it would be truly extraordinary if the new government chose to ignore Parliament altogether when setting out a plan of such importance. Our plan to clear the deficit was and is clear; to rebalance our economy towards investment and exports; not to cut too soon or play fast and loose with the recovery and to fairly divide up the bill for restoring our public finances to health with the right mix of spending cuts and rises in tax.
THESE ARE THE QUESTIONS AGAINST WHICH WE WILL JUDGE THE NEW GOVERNMENT
Will they invest in changing the shape of our economy, bending its path towards investment and exports?
Will they gamble on the recovery, by cutting too much too soon?
Will they seek to shift the burden of rebalancing the books, to those who can least afford it?
Where the government passes the test, we will support them. Where they do not, we will oppose. But our message is blunt. Do not take risks with peoples’ jobs, peoples’ livelihoods and peoples’ services.
RENEWING THE POLITICS OF ASPIRATION
But while on some things we were right. On some things we were wrong. So we need to crack on with addressing the issues the voters told us we need to fix. What struck me hardest was the number of conversations I had with people that came back to a similar refrain;
“I work hard. I’ve always paid in. I don’t ask for much. But why is it that when I need help I can’t get it, and yet I can take you round this estate and show you loads of people doing nothing and getting everything.”
These were the conversations I had with families like my constituent whose wife works 12 hour factory shifts, while he took casual work because he couldn’t get the construction job he was trained for. They earned just too much to win any state help. Or the security guard who lived at home with his aging mother. He worked all hours but couldn’t get help for the care his mother needed because he too earned just too much. Or the mother in Tile Cross who told me her family earned £24,000 a year; but they could barely afford the cost of getting kids through University because the help with living costs for her son even on a full grant, was just too low. These were all people who shared the instincts I grew up with in Harlow. Harlow isn’t a rich place. But it’s not the very poorest place either. It’s a place of people who work hard, and want to get on in life. It’s a place where lots of people juggle lots of jobs – to pay for a bigger, better home; a nicer holiday, a new car, an extension or a conservatory. It doesn’t have airs and graces. It’s a place that is enterprising and above all, it’s aspirational. But too many people now feel that in the Britain of today, aspiration isn’t as rewarding as it used to be. Families are working just as hard as ever. But they feel like they’re standing still. They want lift-off. But they feel stuck in limbo. They’re tolerant people. But what offends them is when they look around at either welfare or the banks and feel they see, in Ghandi’s phrase, wealth without work and commerce without morality. They just don’t think that’s fair. And they have a point. Between 1997 and 2008 our national income rose by over £600 billion. For the decade before the crash, wages for workers in Britain rose just two other OECD countries could match our pace, and the UK’s record was almost 20 points higher than the average for the Euro Area. For the decade before the crash the UK was one of the only countries in the OECD where income inequality declined and household income continues to rise. And for the first time in three decades, evidence appeared that social mobility was finally on the move. But for the last five years, things have got harder. As global change got faster, pressure got sharper on pay packets, the monthly bills and the weekly shop. Disposable income grew by an average of 22% in the 12 years to 2008. But as the FT pointed out in April, it hardly grew at all in 2006 and 2007, and since then the recession has forced private earnings down. Today, a third of our workers work in sectors where wage growth is either low or slow. Today, nearly one in six workers are on low wages – just 1% less than 1999. Today 5.3 million people earn less than 60% of full time median hourly pay.
NO WONDER MANY PEOPLE FEEL SQUEEZED
But now think of the challenge ahead. In the ten years to come, the global economy is going to change again. I still can’t get over the fact that today, we trade more with Ireland than we do with China, India, Russia and Brazil combined. As new markets grow, new opportunities open for Britain. A rising tide, it used to be said, floats all boats. But in the 21st Century that is no longer true. There is nothing inevitable or automatic about new wealth becoming shared wealth. Indeed in the decade ahead we run the risk of a third of our workers falling further and further behind average wages. That will take the power of government to change things. But it demands a new settlement to ensure that families are able not just to pay their way but pave a way to a better standard of living. So I think we need to take a leaf out of President Obama’s book. Last year he asked Joe Biden to begin looking in the round at the help families today now need to get on in the modern, globalising, economy. In the US, that middle-class task-force is up and running. We need a similar effort here; to look anew at the ten key ways that the power of government can help people get on; Jobs, tax and benefits , the minimum wage, welfare reform, skills, higher education, child care, social care, social housing and pensions.
THE PARTY OF COMMUNITY AND RESPONSIBILITY
My final point is this. Labour has to put once again community politics at the centre of our world. In Birmingham, we did well fending off a Tory attack. Gisela Stuart’s extraordinary triumph in Edgbaston will be one of the great memories of election night. In my own seat, we managed to put up the Labour majority. These results were not delivered by direct mail from on high – but by community campaigning on the ground. Not many of Gisela’s – or my – volunteers were paid up Labour members. But they delivered a Labour victory. So, we uregently need a style of campaigning-led politics in our communities led by local Labour politicians. Success will demand reaching out to the civic activists and social entrepreneurs who share out appetite to make a difference on the ground. Canvassing is not enough anymore. Community campaigning means bringing progressive people together to battle for local change. And this is about far more than the renewal of the party’s ability to win elections. This ethos has to become part and parcel of re-asserting Labour as the party of responsibility and community in British political life. The speed with which the world – and our country – is changing is unsettling. But we shouldn’t look at the pace of change and give up, or recoil or reach for some reactionary solution. We need to be new pioneers of a civic revolution. Our response was not to be reactionary, or timid. It was bold and vivid. In cities like my own in Birmingham we created the most extraordinary new civic fabric.
So I believe the Labour party should lead our national response to this challenge again. The ideal of community has always been in our party’s soul – although at times we have found it hard to define. But now we think – and act – locally with a renewed sense of purpose. It demands that we think about the way the new fabric of community institutions in our country – sure starts, neighbourhood police teams, schools – act better to bring community life together. So that centres of local services become centres of local society. It demands we explore thoroughly, not in a cursory way, the potential for mobilising communities to help deliver aspects of public service. It demands we do more on the national stage to raise our moral voice – about the responsibilities of good citizenship for newcomers, so there is a clearer sign-up to the basics of life here. Where we run councils, it demands we ask communities to co-design and help shape local investment in new homes, health centres, new schools and nurseries and not simply parachute in designs from on high. It demans the Labour Party as a party do more in local communities to support, mentor, inspire the change-makers who want to make a difference to what is going on outside their front-door, but do not know where to start. In other words it demands a constant exercise in imagination in every aspect of our work in government and out on the streets of our communities, to put community life first. That means going back to the organizing traditions that gave birth to the Labour party over a century ago, where the ballot box was only one of the ways we made change happen. Political Parties should no longer be movements that just campaign for the hard power of office. They must also be movements that mobilize citizens for change through social action as much as state action. David Cameron wants to steal the idea of fraternity from us. But his idea of a ‘big society’ rings hollow. What I want is a strong society. And strong societies are fair societies – and fair societies have strong states. We must never fall into the trap of pretending government is the answer to everything. But nor can we entertain the politics of crossing your fingers – a manifesto to have charities do the heavy lifting to serve an ideological purpose of shrinking the state.
Let me conclude with this. The Labour Party is not an organisation renowned for adapting to opposition quickly and well. Throughout our history we have often fallen into the habit of deconstructing the past rather than focusing on the future. Let’s not take years to reflect and correct the things we got wrong. Let’s be right not reactionary in fixing welfare and immigration policy without any illusions that if we just fix those things and we’ll be fine and lets not reject the instincts that won us office in 1997. When the New Democrats were born around an agenda that took Bill Clinto n to office, the key was reclaiming the values that were rooted in the hopes and aspirations of ordinary working people. It connected the values of work, reward for work and restraint. It appealed to the public’s natural sense of opportunity and ambitions and, responsibility. This is the sense and these are the values that we need to apply to the challenges of the decade ahead. For all the change of the decade that has passed, we are probably in the foothills of the change that is to come. Every country in the West is struggling to create a new settlement from this new order that works for its citizens. Our challenge is to create from the prosperity that is possible, a country of powerful people in charge of change; in their communities; in their care; in their self development and the unlocking of their future. We have to listen to what the public said to us in this election, focus on the principles that worked so well for us in the past, and get on with the business of applying them to the future.