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The Tories have never had any ideology, so it's not surprising they've run out of steam
A lot of mileage can be made out of the ‘story’ that the Coalition has “run out of steam”, and this week two commentators, Martin Kettle and Allegra Stratton, branded the Queen’s Speech as ‘the beginning of the end’. There is a story that blank cigarette packaging and minimum alcohol pricing policies have disappeared due to corporate lobbying, and one suspects that we will never get to the truth of this. The narrative has moved onto ‘immigration’, where people are again nervous. This taps into an on-running theme of the Conservatives arguing that people are “getting something for nothing”, but the Conservatives are unable to hold a moral prerogative on this whilst multinational companies within the global race are still able to base their operations using a tax efficient (or avoiding) base. Like it or now, the Conservatives have become known for being in the pockets of the Corporates, but not in the same way that the Conservatives still argue that the Unions held ‘the country to ransom’. Except things have moved on. The modern Conservative Party is said to be more corporatilist than Margaret Thatcher had ever wanted it to be, it is alleged, and this feeds in a different problem over the State narrative. The discussion of the State is no longer about having a smaller, more cost-effective State, but a greater concern that ‘we are selling off our best China’ (as indeed the late Earl of Stockton felt about the Thatcherite policy of privatisation while that was still in its infancy). The public do not actually feel that an outsourced state is preferable to a state with shared responsibility, as the public do not feel in control of liabilities, and this is bound to have public trust in privatisation operations (for example, G4s bidding for the probation service, when operationally it underperformed during the Olympics).
It is possibly this notion of the country selling off its assets, and has been doing so under all administrations in the U.K., that is one particular chicken that is yet to come home to roost. For example, the story that the Coalition had wished to push with the pending privatisation of Royal Mail is that this industry, if loss making, would not ‘show up’ on the UK’s balance sheet. There is of course a big problem here: what if Royal Mail could actually be made to run at a profit under the right managers? Labour in its wish to become elected in 1997 lost sight of its fundamental principles. Whether it is a socialist party or not is effectively an issue which seems to be gathering no momentum, but even under the days of Nye Bevan the aspiration of Labour was to become a paper with real social democratic clout. One of the biggest successes was to engulf Britain in a sense of solidarity and shared responsibility, taking the UK away from the privatised fragmented interests of primary care prior to the introduction of the NHS. The criticism of course is that Bevan could not have predicted this ‘infinite demand’ (either in the ageing population or technological advances), but simply outsource the whole lot as has happened in the Conservative-led Health and Social Act (2012) is an expedient short-term measure which strikes at the heart of poverty of aspiration. It is a fallacy that Labour cannot be relevant to the ‘working man’ any more, as the working man now in 2013 as he did in 1946 stands to benefit from a well-run comprehensive National Health Service. Even Cameron, in introducing his great reforms of the public sector in 2010/1 argued that he thought the idea that the public sector was not ‘wealth creating’ was nonsense, which he rapidly, unfortunately forgot, in the great NHS ‘sell off’.
The Conservatives have an ideology, which is perhaps outsourcing or privatisation, but basically it comes down to making money. The fundamental error in the Conservative philosophy, if there is one, is that the sum of individual aspiration is not the same as the value of collective solidarity and sharing of resources. This strikes to the heart of having a NHS where there are winners and losers, for example where the NHS can run a £2.4 bn surplus but there are still A&E departments shutting in major cities. Or why should we tolerate a system of ‘league tables’ of schools which can all too easily become a ‘race to the bottom’? Individual freedom is as relevant to the voter of Labour as it is to the voter of the Conservative Party, but if there is one party that can uphold this it is not the Conservatives or the Liberal Democrats. No-one on the Left can quite ignore why Baroness Williams chose to ignore the medical Royal Colleges, the RCN, the BMA or the legal advice/38 degrees so adamantly, although it does not take Brains of Britain to work out why certain other Peers voted as they did over the section 75 regulations as amended. But the reason that Labour is unable to lead convincingly on these issues, despite rehearsing well-exhausted mantra such as ‘we are the party of the NHS’, is that the general public received a lot of the same medicine from them as they did from the Conservatives or the Liberal Democrats. Elements of the public feel there is not much to go further; the Labour Party will still be the party of the NHS for some (despite having implemented PFI and NHS Foundation Trusts), and the Conservatives will still be party of fiscal responsibility for some (despite having sent the economy into orbit due to incompetent measures culminating in avoidance of a triple-dip).
It doesn’t seem that Labour is particularly up for discussion about much. It gets easily rumbled on what should be straightforward arms of policy. For example, Martha Kearney should have been doing a fairly uncontroversial set-piece interview with Ed Miliband in the local elections, except Miliband came across as a startled, overcaffeinated rabbit in headlights, and refused doggedly to explain why his policy would not involve more borrowing (even when Ed Balls had said clearly it would.) Miliband is chained to his guilty pleasures of being perceived as the figurehead of a ‘tax and spend’ party, which is why you will never hear of him talking for a rise in corporation tax or taxing excessively millionaires (though he does wish to introduce the 50p rate, which Labour had not done for the majority of its actual period in government). It uses terms such as “predistribution” as a figleaf for not doing what many Labour voters would actually like him to do. Labour is going through the motions of receiving feedback on NHS policy, but the actual grassroots experience is that it is actually incredibly difficult for the Labour Party machine even to acknowledge actually well-meant contributions from specialists. The Labour Party, most worryingly, does not seem to understand its real problem for not standing up for the rights of workers. This should be at the heart of ‘collective responsibility’, and a way of making Unions relevant to both the public and private sector. Whilst it continues to ignore the rights of workers, in an employment court of law over unfair dismissal or otherwise, Labour will have no ‘unique selling proposition’ compared to any of the other parties.
Likewise, Labour, like the Liberal Democrats, seems to be utterly disingenious about what it chooses to support. While it seems to oppose Workfare, it seems perfectly happy to vote with the Government for minimal concessions. It opposes the Bedroom Tax, and says it wants to repeal the Health and Social Care Act (2012), but whether it does actually does so is far from certain; for example, Labour did not reverse marketisation in the NHS post-1997, and conversely accelerated it (admittedly not as fast as post-2012). No-one would be surprised if Ed Miliband goes into ‘copycat’ mode over immigration, and ends up supporting a referendum. This could be that Ed Miliband does not care about setting the agenda for what he wants to do, or simply has no control of it through a highly biased media against Labour.
Essentially part of the reason that the Conservatives have ‘run out of steam’ is that they’ve run out of sectors of the population to alienate (whether that includes legal aid lawyers or GPs), or run out of things to flog off to the private sector (such as Circle, Serco, or Virgin). All this puts Labour in a highly precarious position of having to decide whether it wishes to stop yet more drifting into the private sector, or having to face an unpalatable truth (perhaps) that it is financially impossible to buy back these industries into the public sector (and to make them operate at a profit). However, the status quo is a mess. The railway industry is a fragmented disaster, with inflated prices, stakeholders managing to cherrypick the products they wish to sell to maximise their profit, with no underlying national direction. That is exactly the same mess as we have for privatised electricity, or privatised telecoms. That is exactly same mess as we will have for Royal Mail and the NHS. The whole thing is a catastrophic fiasco, and no mainstream party has the bottle to say so. The Liberal Democrats were the future once, with Nick Clegg promising to undo the culture of ‘broken promises’ before he reneged on his tuition fees pledge. UKIP are the future now, as they wish to get enough votes to have a say; despite the fact they currently do not have any MPs, if they continue to get substantial airtime from all media outlets (in a way that the NHS Action Party can only dream of), the public in their wisdom might force the Conservatives or Labour to go into coalition with UKIP. There is clearly much more to politics than our membership of Europe, and, while the media fails to cover adequately the destruction of legal aid or the privatisation of the NHS, the quality of our debate about national issues will continue to be poor. Ed Miliband must now focus all of his resources into producing a sustainable plan to govern for a decade, the beginning of which will involve an element of ‘crisis management‘ for a stagnant economy at the beginning. The general public have incredibly short memories, and, although it has become very un-politically correct to say so, their short-termism and thirst for quick remedies has led to this mess. Ed Miliband seems to be capable of jumping onto bandwagons, such as over press regulation, but he needs to be cautious about the intricacies of policy, some of which does not require on a precise analysis of the nation’s finances at the time of 7th May 2015. With no end as yet in sight for Jon Cruddas’ in-depth policy review, and for nothing as yet effectively Labour to campaign on solidly, there is no danger of that.
A complex interplay of factors now determines the future of the NHS
2011 was the first full year of the introduction of the full privatisation of the NHS, and a year of the steepest decline in public satisfaction in the UK, in the first full year of the Coalition after all parties had failed to win outright the 2010 UK general election. There’s a very important notion in finance and business that the markets are very sensitive to dividends. That is why for example other investors will be interested in the corporate ‘health’ of the economy, with the shareholder dividend as a potent signal in the market, for example.
I spent this afternoon spending a couple of hours at the Socialist Health Association Annual General Meeting. Obviously rules provide that I cannot blog openly about what was discussed, partly because I cannot remember exactly what was discussed. Imagine my joy when I emerged from the Friends Meeting House on Mount Street to find that @Putneydebates has let me know that Ed Miliband had made an announcement on the NHS. This was all however relatively relaxing compared to having read all 500 pp. of the new Health and Social Care Act for an informal chat I was to have with Dr Lucy Reynolds later last week.
I have indeed had trouble in finding the actual announcement. This is the best I could find:
Please note the use of the word “reverse”, and critically of the word ‘all’. In this era of knee-jerk reactionary politics, it is important to be clear about HM’s official Opposition can achieve realistically. This is because Labour are intensely edgy, because they do not know the exact state of the economy on May 8th 2015. If the Conservatives inherited a “mess” due to a massive financial stimulus to the banking industry to stop an outright depression, the mess potentially handed to the governing party/parties in May 2015 could be far worse. When Labour lost the election in 2010, the UK economy was actually growing. It then predictably entered a ‘double dip recession’ earlier this year due to a lack of a Keynesian stimulus and strangulation of consumer demand (as people in the public sector had less money, and VAT went up).
Andy Burnham has previously promised to repeal the Act (as he argued for a long time in Parliament). This is not in any dispute, though critics wonder about, having made the promise, what a realistic timescale for the repeal might be. Burnham is aware that, by 2015, more of this ‘top-down reorganisation’ (which nobody as such voted for), will have been implemented. We may still be in recession in May 2015, therefore it would be impossible for Labour to embark on a costly programme for the NHS. The facts are that Labour has introduced commissioning in some form, and Foundation Trusts, but the extent of private ownership, the elaborated on commissioning, means that there are strands of policy which are indeed deeply engrained. Furthermore, it is certainly not clear what the state of the UK economy will be in May 2015; the UK economy entered a double-dip earlier this year, and borrowing is increasing, therefore Labour’s room for manoeuvre is genuinely limited.
There is no doubt that there was much distress amongst some about the UK Labour Party’s future direction on the NHS last night. The problem is that NHS has had so many operations, some plastic genuinely to make it function, some reconstructive to make it appear more attractive, that it now runs the risk of being totally unrecognisable as a hybrid public-private entity. The general public might ‘blame’ the Coalition for introducing these reforms under duress, against opposition of all the Medical Royal Colleges, in particular the Royal College of General Practitioners, under the leadership of Clare Gerada, and the British Medical Association. Some of the public even blame New Labour for introducing the marketisation of the NHS (allegedly), and some blame the BBC particularly (although the topic is incredibly complex, and various interests have been mooted as possibly for why the BBC has preferred to keep silent on the issue as the Bill went through parliament and the House of Lords). However, a growing corpus traditional Labour voters feel that Labour has betrayed its roots on a NHS, truly national, free-at-the-point of use, and paid for entirely out of the taxpayer and which does not make a profit. Indeed, aspects of the denationalisation, marketisation and privatisation can indeed viewed on a spectrum of abolition of national health bodies (such as the Health Protection Authority and National Patient Safety Agency), pricing and competition strategies, procurement contracts which have to obey UK and EU competition law, the introduction of GP Clinical Commissioning Groups (CCGs), administration and rescue of failing trusts, mergers of clinical entities, and acquisitions of State hospitals by private entities. Some of this can be unpicked, some of it is not so easy to unpick.
The extent of private involvement can be unpicked, setting caps by Government, is at the heart of this, and to ensure that enforcement mechanisms exist through Monitor and the Competition Act for large corporates not to abuse economies of scale to deliver a service ‘of poor quality’. These budgets proposed for the CCGs are sufficiently high for the Public Contracts Regulations 1996 to kick in, and because of the way that a financial undertaking is defined by Europe in case law, for EU competition law to kick in (such as article 101). Corporate restructuring and financial restructuring of failing entities are a complicated science, and could apply to CCGs and the new model army of the NHS Foundation Trust; financial assistance is a consideration, and, whilst the sector regulator Monitor will be heavily involved, also embroil in addition to the Health and Safety Act (2012) the Companies Act (2006) and Insolvency Act (1986).
Andy Burnham MP was forced yesterday afternoon to shout ‘repeal, repeal, repeal’ on Twitter, for instance:
Andy had also made this very clear in the Houses of Parliament earlier this year in the ‘opposition day’ debate on the NHS:
In this video, Andy Burnham does confirm his intention to repeal the Act ‘in its entirety’, ‘as it is a defective piece of suboptimal legislation which has saddled the NHS with a complicated mess” and “unintelligible”; Burnham adds further “it would be irresponsible to leave it in its place”. Ed Miliband, however, has previously mooted that he might reverse clinical commissioning, but Miliband’s current position on this is unclear. To reconcile the fact the Act will be repealed but there will be a change of direction under Labour, Burnham states that “organisations will be asked to differently”, implying that the structures being abolished in the current tranche in reforms will remain abolished (i.e. PCTs and SHAs), but there will be less competition in the further evolution of the Act which might not necessitate a new full-blown act and not require yet another extremely costly “top down reorganisation”, as it is said that morale in most of the NHS is now actually extremely poor.
There is no doubt that there has to be further documented guidance on the investigative powers of Monitor, although it is true to say the onus will be on the sector to report issues (as similar for the FSA and OFT), but CCGs will need to have legal guidance about defending possible legal claims for judicial review or breach of contract in procurement contracts for enforceable legal rights. According to s.10(1) Part 2 Schedule 1A of the Act, a CCG is a ‘body corporate‘, which is extremely fortunate as the default position would have been a traditional legal partnership under the Partnership Act (1890) s.1. Whilst many CCGs may view themselves as businesses, many have not chosen to become private limited companies under law (directors of a private limited company are obligated to promote the success of the company, under the Companies Act (2006), which is narrowly defined as maximisation of shareholder dividend); however legal clarity is indeed needed about the liability of the body corporate of the CCG in this particular case, as for example private limited companies have limited liability but traditional partnerships do not. It is patently clear that CCGs, which might still outlive this political drama, will need advice on, and more resources for, the management and legal operations of their businesses, whilst Labour struggles the ‘best’ of clinical commissioning. Labour may also have to work closely with firms such as KPMG and KcKinsey and Company, with the Coalition, in the meantime to construct a ‘risk register’ regarding issues faced by CCGs in real life (such as ongoing problems with contracts or staff wishing to resign or being made redundant). Labour also has to revisit the issues, even having repealed the Act, at an operational level to address rationing-by-cost which it has traditionally opposed, as for example shown in cataract surgery.
This has now turned into a political mess, and Labour as far as I can tell is still fully committed to getting rid of the Act. This would send out a very positive message from the Labour ‘command and control’ centre to its members and potential voters, but Labour needs to resolve as to whether this might spook out corporate investors through for example dividend signalling described above. However, whilst yesterday afternoon was ‘not great’, at least Labour appears to be willing to have a clear debate about this. Andy Burnham has asked the Coalition ‘to be honest about its true intentions about private involvement in the NHS’, and it would help all concerned, especially those in the NHS (including doctors particularly GPs, nurses, other healthcare professionals) members of the public, lawyers and management consultant firms, if Labour could be categorically repeat in a speech that (a) the Act will be repealed, (b) some indications about which strands of it (some are deeply enmeshed) will remain in situ.
Ed Balls – know your competition!
I would be very surprised if Tom Baldwin and Ed Balls didn’t have a meeting early on to consider how the new Director of Communications of the Conservatives might ‘attack’ Ed Balls. The media, broadsheets and tabloids, have tried to use the simple picture of Ed Balls as a “bruiser”, but it seems that the Coalition is taking the line of attack that “you must never put the pyromaniac in charge of fire safety“.
There are some consistent names put forward in the ‘runners and riders’, although some have even fleetingly mooted the idea of Nick Robinson, Laura Kuenssberg and Paul Staines being ideal for the post, which apparently carries a formidable salary of £140K per year. Tim Montgomerie from ConsHome has been exceptional at explaining the Tories’ policy to peers and the public; he is perhaps the unofficial Tory Director of Communications.
Here are some observations of the four key favourites.
Gutto Harri
Gutto Harri is not overtly political, reflected in the fact that he doesn’t comment himself much on politics – is said to be well connected in Conservative circles. Harri went on to notch up 18 years at the BBC, and built up good contacts with some of the Conservative Party’s more gregarious politicians. It has become common knowledge in political circles that Harri was approached last year about becoming the party’s director of communications. According to Tory sources, Harri first spoke to strategy director Steve Hilton and then went to Cameron’s Oxfordshire home to discuss the issue.
George Pascoe Watson
Another candidate is George Pascoe-Watson, the Sun’s former political editor, who left the tabloid after 22 years for public relations in October 2009. His departure came just weeks after Murdoch-owned newspaper switched allegiance to the Conservative party and he was one of the paper’s leading spokesmen explaining the decision. He reported in the Sun in March 2009:
CHILDREN’S Secretary Ed Balls came as close to saying “sorry” as anyone in Government yesterday for Labour’s failure to stop the banking crisis.
Pascoe-Watson has been keeping an eye on Balls, reporting that Balls now accepted that ministers failed to spot the dangers involved in the enormous risks taken by banks during the economic boom. He is a strong supporter of Osborne, and has never acknowledged even vaguely remotely why Cameron’s policy is reckless and what the rationale for Balls’ policy is.
Benedict Brogan
Benedict Brogan is now the Deputy Editor of The Daily Telegraph and is described as “one of Westminster’s keenest observers”; his range of analysis across a number of diverse political areas is indeed remarkable. Brogan has appeared to have been fair in reporting Balls’ assessment of the economy. For example, one story in 2009 provided that:
Crisis is worst for 100 years, says Balls
Brogan wrote at that time:
Ed Balls, the Children’s Secretary, who was Mr Brown’s chief economic adviser for a decade, said: ‘The economy is going to define our politics in Britain in the next year, the next five years, the next ten and even the next 15 years.
‘These are seismic events that are going to change the political landscape. This is a financial crisis more extreme and more serious than that of the 1930s and we all remember how the politics of that era were shaped by the economy. We now are seeing the realities of globalisation, though at a speed, pace and ferocity which none of us have seen before. The reality is that this is becoming the most serious global recession for, I’m sure, over 100 years as it will turn out.’
On the relationship between Ed Balls and Ed Miliband, Brogan himself conceded that on September 26th 2010:
Politically, it would be easier for Ed M to reward Ed B. Their outlook is similar and it would be an ideologically more stable arrangement
Ian Birrell
Ian Birrell is a former deputy editor of the Independent and worked as a speechwriter for David Cameron during the 2010 election campaign. His pugnacious approach is exemplified here, in this remark from 21 August 2009:
Later, I wrote an article for a weekly journal that ended with a challenge to the then Chancellor, Gordon Brown. As I entered the dining room, Mr Brown gave me a wolfish smile and ushered me to sit down between him and Ed Balls, before the pair took me to task for the next half hour. Both seemed unabashed statists when it came to health, who saw more money as the answer to all problems and had little sympathy for the idea of introducing competitive or patient-led elements.
If Cameron wishes to have a robust defence of marketisation, and portray the State as ‘evil and bulky’, Birrell is perhaps his man. If he wants to counter the arguments that Balls will produce as to why the current Tory policy may produce worsening GDP, increasing unemployment and a decreased level of growth, Birrell (and indeed George Pascoe-Watson) may not be suitable. The economy and the NHS are going to be defining issues for Miliband, Balls and Baldwin in the next few years, arguably.