A progressive policy – a hand up not a hand out

Peter Mandelson comes over as a little rattled today in the Guardian with his personal attack on George Osborne. Yesterday George made it more difficult for him, by refusing the BBC’s request to spell out the numbers “behind the cuts” so Labour could go back to playing their childish and boorish spin game of “Labour investment versus Tory cuts”. Not even the BBC’s spin dominated interviewers could get the necessary ammunition out of Mr Osborne, who understood exactly what they wanted and knew he was in enemy territory when in the BBC studio.

Despite the usual Labour noises off steering the interviews, George did get across three crucial messages. We face a spending crisis, not a crisis of taxing too little. The way out of it is doing more for less. The way out has to encompass fundamental public service reform, as well as driving for much greater efficiency. Gordon Brown has always been the roadblock to reform, including the welfare reform that Labour failed to achieve in their first term , and their health and education reforms which Blair, Milburn and others wanted but failed to put through in the following two terms.

So let us look at what becoming the progressive party, the party of public sector improvement and reform, means. It means showing that Conservatives wish to govern in the interests of all the people. We do not wish to divide the country into a privileged public sector and the rest. We do not wish to heighten class divides, pick on groups like motorists or financial service personnel for special taxes and condemnation, or create a client state at the expense of everyone who supports themselves and their families. We do not regard it as a crime if you work for yourself, make profits in your business, save for a pension, drive to work, want to send your child to a better school, want to run a cake stall at a local fete, put out your rubbish for collection weekly or improve your home.

In the 1980s we took over responsibility for a near bankrupt quite poor country which had been gravely damaged by Labour economic mismanagement. I proposed popular capitalism. The idea was to offer people a stake in their country. We needed to harness the energy, goodwill and savings of many British people to bring about economic recovery, and to rebuild the social fabric. We launched portable pensions, more employer based private pensions, shareholdings in privatised companies, employee share schemes, worker buyouts of public enterprises and Council house sales. We created new armies of owners, people with a stake in the country, people who wanted to take a pride in their home or their business, people who wanted some idependence from the state. Labour of course rubbished it and caricatured it, but it proved popular. The big privatisations transformed telcoms and energy production, cutting prices and improving service. National Freight went from strength to strength when the lorry drivers and their managers bought it from the government. BY the time Labour took over we had more shareholders and much more saved for retirement than the rest of Europe put together.

Today the vision we need to offer has to be even bigger. The state is closer to bankruptcy, the public finances are in a much worse condition, and society is broken in many places. We need to offer people a hand up, not a hand out. We need to tackle too much dependency on the state. We need to remind people that they can be better off and feel better about themselves if they are freer of state interference. We need welfare reform, as the best way of looking after the family’s financial needs is a job. We need educational reform, to end the apartheid of private and state schools, whilst ensuring free places for all who want them. We need health reform. We have to show we can do more for less, as private industry has to do every year to stay in business.We need transport reform, as our economy and our daily lives are badly impaired by the inadequacies of Labour’s politically correct transport mess.

I will be writing about each of these in turn in the days that follow.

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21 Comments

  1. Mike Stallard
    Posted August 12, 2009 at 6:41 am | Permalink

    You are so right. Last night on Newsnight, the Conservatives were rubbished. Fraser Nelson and someone from a think tank were not really listened to. No attempt at all was made to see exactly what George Osborne was saying. It was a good job that George Osborne didn’t go on the programme. Lord Mandelson put on a suit for his little speech about his good friend (and friend of Oleg Deripaska – geddit?). Ken Clarke was conspicuous by his absence: he is the best TV performer the Conservatives have.
    I very much look forward to the next few posts.
    Our real question, to be fair, is not really whether you understand what has to be done – with costings. It is whether the Conservative party as a whole is determined to put it into practice.

  2. ken from glos
    Posted August 12, 2009 at 6:57 am | Permalink

    I do hope you will discuss Final Salary Pension Schemes at some point because i have much to say on this subject.

    I expected dignity in old age with my public pension and not the rich lifestyle I now have.

    My take home pay is now larger then when i used to work for a living. Unsustainable madness.

  3. david
    Posted August 12, 2009 at 8:49 am | Permalink

    Energy cheaper? Would you like to give me the one year under public ownership when Gas/Electricity prices rose by 35%?

    The terrible state of our energy transmission and supplies is due entirely to the fact they were handed over to pirates, who’ve done nothing but squeeze the consumer till the pips squeak.

    I wonder what you’ll be saying when a Conservative government has to take them back into public ownership to keep the lights on.

    • Downsized Pete
      Posted August 12, 2009 at 9:18 am | Permalink

      Good point. Underinvestment in energy infrastructure is going to cost us dear very soon. The lead article in this week’s Economist gives a very gloomy prospect of the situation by 2015. Heaven forbid we put ourselves in the hands of those nasty Russians to keep the lights on. It would be interesting to hear you views on this subject in the coming weeks John

      reply Last summer I did a series on “Crumbling Britian” with recommendations on how to put in more infrastructure, including energy.

    • backofanenvelope
      Posted August 12, 2009 at 10:01 am | Permalink

      Well, I am sure someone can come with a comparison between the previously publicly own utilities and the current lot. I seem to remember that electricity prices went up every year; I also remember being given a £50 rebate after they were privatised.

      I also bought shares in the utilities as they were privatised. For the first time I had a stake in the country – before, the stake was owned by people like Tony Benn.

    • APL
      Posted August 12, 2009 at 5:26 pm | Permalink

      david: “The terrible state of our energy transmission and supplies is due entirely to the fact they were handed over to pirates …”

      Of course perhaps you don’t know it, but the real pirates are the government. What did you expect? the socialist government has infultrated and taken over the regulatory bodies and used them to implement Government policy.

      Industry implementing government policy, it certanly isn’t free market capitalism. Remind me again, what is the defination of facism?

      By the way, they have done exactly the same thing with the charitable sector. Former charitable organisations like the NSPCC are little more than arms of government policy – they certanly arn’t a charity.

      Oh, and by the way, A certain French power company has one Mr. Brown as a consultant for its UK operations, oddly enough we seem to have a probably entirely unrelated Mr Brown, running the country (badly).

      I’m sure there is no connection.

      david: “.. who’ve done nothing but squeeze the consumer till the pips squeak. ”

      When the government constrains a companies actions through leglislation it is little surprise you do not see the benefits of the free market.

  4. Jim Pearson
    Posted August 12, 2009 at 9:18 am | Permalink

    Good words, and rallying phrases. Shame you can’t say it in the HOC, but it’s locked for the summer. Bit like the companies going bust… Time for the administrators, roll on the election.

  5. figurewizard
    Posted August 12, 2009 at 9:30 am | Permalink

    I heard George Osborne on yesterday’s ‘today’ programme and was impressed. It came across that not only he but the people he is working with really are concerned to effectively and openly address the very grave financial situation this country is facing.

    This morning it was Mandelson’s turn and it was a completely different matter. The interviewer spent half his time wrestling with him, trying to get answers to his questions while Mandelson insisted on talking about the Tories instead. The interview finally degenerated into a bad tempered spat between the two of them.

    If, as Mandelson’s performance seems to indicate, Labour’s current strategy is to be centred on refusing to answer any direct questions unless they provide opportunities to knock the opposition then long may it continue. The whole interview left a very bad not to mention farcical impression.

  6. Brian Tomkinson
    Posted August 12, 2009 at 9:33 am | Permalink

    It’s a pity that your party is continually scrambling around for slogans – the latest one being “the progressive party”. George Osborne might be regarded as very clever in avoiding any details of how he would bring our public finances back from the abyss and Mandelson played a similarly uninformative game on the “Today” programme this morning, but for the listeners it is just the opposite of being clever, it is yet another example of the contempt politicians have for the electorate. We want to know what action would be taken by an incoming Conservative government. We don’t expect precise details but we need more than vague expressions of intent which are not credible without at least an outline plan for their achievement. If interviews are not going to reveal your plans how and when are we to be informed? Will your party leave it till the last moments before the election? Or perhaps there are no plans!

    • figurewizard
      Posted August 12, 2009 at 12:22 pm | Permalink

      We all know that things are bad but what none of us, including the leadership of the Conservative party know exactly how bad they are. Two huge unknown quantities for example are the long term liabilities associated with guaranteed pensions within the public sector and those of PFI. Only when a Conservative government has untrammeled access to the books will it be possible to tell which areas of the economy and by how much will be needed to bear the brunt of a recovery programme.

      It should be remembered that when Tony Blair was Prime Minister even he was kept in the dark by Gordon Brown as to budget details, including the now infamous abolition of the 10P tax band, so what hope do the opposition have of having a clear picture of the state of the economy today?

      • Brian Tomkinson
        Posted August 12, 2009 at 7:28 pm | Permalink

        So do we have to wait until after the election to find out what a Conservative government would do? I don’t think that is good enough.

        Reply: No of course not. They will publish more and more detail in the run up to the election, as they have recently over monetary policy and the abolition of the FSA

    • jduck1979
      Posted August 16, 2009 at 11:57 pm | Permalink

      I’m sure they’ve got policies for putting Labour’s economic mess right (once again), but as you may recall since after the 2007(?) party conference whenever the Conservatives have announced a Policy, the Labour lot have a nasty habit of nicking them………. so the Conservative’s policies for fixing the economy won’t likely be unleashed until the General Election battle is in full swing & it’s too late for the Labour lot to pinch them without showing themselves up further than they already have.

  7. oldrightie
    Posted August 12, 2009 at 9:47 am | Permalink

    “David

    The terrible state of our energy transmission and supplies is due entirely to the fact they were handed over to pirates, who’ve done nothing but squeeze the consumer till the pips squeak.”

    Yup, to a much greater degree under the Labour greed of the last nearly 13 years. The tax take has been behind much of these problems. Like the rest of our infrastructure, heavily taxed businesses and motoring see little return for their heavy dues. Labour have squandred billions to fuel an illusory feel good factor and gain electoral advantage. They never understood that one day the cash would run out and the debt overwhelm them. Not as individuals, of course, they are wealthy beyond avarice. Socialists, progressives? Only for themselves.

  8. Acorn
    Posted August 12, 2009 at 10:15 am | Permalink

    You have to wonder if dear old Blighty is over the cusp and it is downhill from here. Are we destined to be an additional chapter in The Economic Decline of Empires By Carlo M. Cipolla, should it ever be updated.

    Thanks to Goggle you can read a preview of the book. It is worth reading the Editor’s Introduction. I think you may see remarkable similarities with our current political and economic situation. There is a chance that there is no solution and we are destined to follow the same route that many previous empires have gone.

    http://books.google.co.uk/books?id=jmqHCTK-mwkC&printsec=frontcover&source=gbs_navlinks_s#v=onepage&q=&f=false

  9. Pete Chown
    Posted August 12, 2009 at 10:38 am | Permalink

    I’ve just been reading Mandelson’s attack on Osborne, reported in the Guardian. (I read Tory blogs plus the Guardian, to make sure I don’t get brainwashed by either side!)

    http://www.guardian.co.uk/politics/2009/aug/12/mandelson-tory-public-service-plans

    “To be a progressive is to believe that we can make a better society and improve the conditions of individual lives by acting together,” says Mandelson. It sounds so good, doesn’t it? What we really got from Labour, though, was socialism. “Act together or we will smack you.”

    Mandelson is also reported as making a crucial admission. “[Osborne has] an ideological commitment to government retrenchment and a budget that is cut until it is ‘balanced’, regardless of the consequences for growth or individual welfare,” says Mandelson. In other words, Mandelson thinks you can keep borrowing and spending, provided you think this is important for “growth” and “welfare”.

    Back in the real world, it doesn’t work like that. You keep borrowing for a while, then the markets lose confidence, and you have no choice but to cut. The result is boom and bust: boom when you’re able to borrow freely, bust when the markets decide that you are a sub-prime government, and won’t lend any more. This boom and bust, of course, is harmful to both growth and welfare.

    With my personal finances, I try to be prudent and to put money aside when times are good. I would like the public finances to be run the same way, and is that really too much to ask?

  10. Demetrius
    Posted August 12, 2009 at 10:50 am | Permalink

    By coincidence today I mentioned how different things are since 1980 compared with what we hope for and expected. Whoever is elected in 2010 will face a radically changed situation. In the last 12 years the process of destruction has not just given us severe problems, but had destroyed the basic ability of the UK government to either govern or make effective decisions. So in order to work to whatever vision a new adminstration may have, it will have to recreate the ability to do so, because it will not be able to restore what we have lost, or rather have had taken away from us by an arrogant and greedy elite.

  11. Robert K, Oxford
    Posted August 12, 2009 at 11:02 am | Permalink

    Never has there been a better time for revolutionary change in the settlement between the state and the citizen.

    The remarkable aspect of the past couple of years is how a crisis in debt capital markets and the attendant recession is now almost overshadowed by the catastrophic state of the public finances, coincident with an increasingly autocratic, almost fascistic, style of governance. This is no coincidence. The process that Mr Brown has put underway, wittingly or not, is the one that Hayek warned of in 1942 in the Road to Serfdom: an obsession with state planning is destroying liberty, compromising natural justice and undermining wealth creation.

    The only government worth voting for in the upcoming election is one that clearly commits to the virtues of individual responsibilty and supports reward for effort, innvoation, investment and capacity for risk. In other words, a government that acknowledges the morality of free markets in contrast to the immorality of socialism.

  12. Frugal Dougal
    Posted August 12, 2009 at 12:24 pm | Permalink

    It’s ironic that “a hand up, not a hand out” is a motto adopted by many groups and businesses run by homeless and former homeless people, many of whom had been groomed for life on the street by abusive, disempowering Labour social policy.

  13. Colin D.
    Posted August 12, 2009 at 1:12 pm | Permalink

    I notice that ‘becoming the progressive party’ fails to include a return to democracy. Unless the Conservatives wrest power back from Europe, freedom and democracy will continue to wither and most of the good things you list will, sooner or later, be compromised.

  14. Deborah
    Posted August 12, 2009 at 10:07 pm | Permalink

    The big problem today is that the ordinary person has been made to feel completely impotent and finds it hard to believe that anything they do will make any difference.

    Yesterday my credit card was blocked because of suspected fraud. Despite spending an hour on the phone to the sub-continent, the silly rules imposed by the bank in the name of data protection rendered me powerless to sort it out.

    A friend has been doing work experience in court, where the judges are frustrated by the lack of prison places and the maximum sentences imposed by govt. The public knows that the justice system is not protecting them but there is nothing they can do about it.

    Petty bureaucrats pick on people and make life difficult for them for any one of a number of minor infringements – parking, smoking, policial incorrectness, not closing the bin lid……the list goes on but the individual has no come back.

    Complaining to the people’s champion – the ombudsman – is a waste of time. First, he will require you to spend a year going through “the local complaints procedure” – designed to put off anyone with a life to live. After that you may still find that his remit is so tightly drawn that it excludes your case. Even if your case is added to the waiting list, you will have lost the will to live before it is dealt with.

    Banks lose a fortune and get bailed out with public money -but carry on regardless, paying huge bonuses. Politicians get caught out, but after wearing a hair shirt for a few weeks, everyone moves on as though it never happened.

    Babies get murdered and people die unnecessarily in hospital, but the reports just recommend more ineffective paperwork and those responsible just change jobs in th merry-go-round that is the public sector.

    People are really fed up with the surveillance, the nanny state, the endless bureaucracy, and the complete lack of accountability. But their vote makes no difference. I’m beginning to think someone likes it that way.

    in teh fae of all the

  15. Steve Hemingway
    Posted August 15, 2009 at 1:56 pm | Permalink

    You did launch portable pensions, but you unfortunately caved into lobbying from the CBI and removed any obligation on the part of employers to make contributions to them equivalent to the contributions they were prepared to make to non-portable schemes with the result that the take up was extremely low. Arguably this, rather than GB’s ‘raid’ on pension schemes, has led us to the appalling state of private pension provision in the UK that we face today.

    Reply: Not so. Our pension funds were in rude health prior to 1997, expanding and offering good provision for the future.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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