BERR
In a profile of John Hutton, the new Secretary of State for Business, Enterprise and Regulatory Reform, Hutton said that Labour ‘is the natural party of business’,(1) another benchmark (or, in Corinne Souza country, ‘rebranding’) in the shift from old to New Labour. For it was Harold Wilson’s boast that he had made Labour ‘the natural party of government’. The Department of Business Enterprise and Regulatory Reform (BERR) used to be the Department for Trade and Industry, a name which really had to go, emitting, as it did, terrible heavy, menial, old Labour, manufacturing kind of vibes – not at all suggestive of the financial services or the Knowledge Economy so beloved of Numbers 10 and 11 Downing Street.
John Hutton is one of the group of New Labour people making their way in government. Hutton was one of the Blairite ‘bright sparks’ of the past few years – intelligent, reasonable looking, good on TV, with no ideological baggage to worry about. For a little while there he was being tentatively floated as a possible ‘stop Gordon’ candidate by the Blairite grouping.
Now, I confess: I hadn’t even noticed the formation of the Ministry of Business, Enterprise and Regulatory Reform. Suitably chastened I asked Google and found this on the No. 10 website:
‘the Department for Business, Enterprise and Regulatory Reform (BERR) is responsible for creating the conditions for business success, developing deeper and more effective engagement with business, and with the ability to promote the competitiveness agenda across critical areas of Government policy.
BERR brings together functions from the former Department of Trade and Industry, including responsibilities for enterprise, business relations, regional development, fair markets and energy policy, with the Better Regulation Executive (BRE), previously part of the Cabinet Office.’
This generated another question: what was the Better Regulation Executive (BRE)?
BRE’s arrival was heralded by then Chancellor Gordon Brown in 2005. He said this about it in his press statement on 24 May 2005.
‘The modern enterprise challenge is to enhance the flexibility needed for a successful economy and tackle the regulatory concerns we know all industrial economies face without sacrificing the standards a good society needs.’ (emphases added)
Brown contrasted the ‘old regulatory model’ based on ‘the old assumption……that business, unregulated, will invariably act irresponsibly’, with the ‘new risk based model’: ‘….instead of routine regulation attempting to cover all, we adopt a risk based approach which targets only the necessary few.’
This ‘risk based model’ is based on ‘the better view …..that businesses want to act responsibly. Reputation with customers and investors is more important to behaviour than regulation, and transparency – backed up by the light touch – can be more effective than the heavy hand.’
In one reading this is a classic of New Labour thinking. As Elliot and Atkinson point out in great detail in their splendid Fantasy Island (which is reviewed in this issue), at the core of the New Labour view of the world is the belief that the hard choices can be avoided: for example, the belief that we can have global military commitments and low defence spending.(2) Brown was assuring us in 2005 that we can we can have high standards and low regulation. All those nice companies out there will look after things without the government leaning over their shoulders.
A second reading of this is that this is a kind of cover story; that Brown is actually talking about the need to lower standards to be able to compete with the rest of the (non-EU) world which has lower standards than we do; and this will be recognised by the business community as Brown talking in the necessary code. For that community understands that no politician can just announce that to maintain the UK’s economic competitiveness many of its citizens are going to have to earn less – and maybe a lot less – in the race to the bottom.
A third reading would combine readings one and two but would dismiss the whole thing as bullshit PR aimed at the business community, PR which that community will not take seriously.
Elsewhere the government is trying to reduce incomes in the public sector by imposing pay rises worth less than inflation; and I would bet there are Treasury studies being done to estimate by how much income support/unemployment benefits have to be reduced to persuade the (British) unemployed to take the jobs currently being done by migrants. New Labour constantly talks up the benefits of globalisation but the real story is that most of us in the UK are going to be less well off.
Inflation
Not very far down the road, the current rises in world prices for food, energy and raw materials are going to be feeding through into the UK economy as price rises that are included in the government’s measure of inflation and we will ‘miss our inflation target’. At which point the Bank of England’s Monetary Policy Committee is obliged to contact the Chancellor and tell him what the committee is going to do to get inflation back down to the 2% level. And that will means rises in interest rates, the Monetary Policy Committee’s only available policy tool. Which, in the current climate, will mean house repossessions, and increasing unemployment. How this will be squared with the current clamour for lower interest rates to meet the ‘credit crunch’ we will see.
Still digging
Elsewhere in Whitehall, back at the public trough, in the strange and terrible saga of this government’s decade-long infatuation with employing private sector ‘consultants’ to show the useless public sector how to do things, the Sunday Telegraph reported that between 2002 and 2006/7 DEFRA (The Department of the Environment, Food and Rural Affairs), the least significant of the Whitehall spending departments, had spent £1.1 billion on ‘consultants’, of which £490 million was spent on ‘IT workers administering rural payments to farmers’ – i.e. trying to repair and work round the faulty IT system installed by another group of whizzo ‘consultants’.(3)
However you think of New Labour – neo-cons, Thatcherites, careerists, emulators of the Clinton Democrats – their outstanding feature has become their utter incompetence. Across almost the entire spectrum they persist with policies which are demonstrably not working. Thinking kindly, we might call them people in the grip of theories (though perhaps mostly theories about their careers). If he wasn’t so irredeemably old Labour for them, Denis Healey’s dictum, if you are in a hole, stop digging, would be worth their consideration.
All our yesterdays
Alastair Campbell’s The Blair Years (London: Hutchinson, 2007, h/b, £25) has been widely reviewed elsewhere and, like most reviewers, I found it tedious and oddly fascinating at the same time. While I read/skimmed it I marked the bits that struck me. Minus the section on Putin discussed elsewhere in this issue, these few are they.
1994 Blair trying to persuade Campbell to take the job with him: ‘He said I was right to feel nervous, but together we could change the face of British politics for a generation, and change the world while we’re at it.’ p. 22
Blair’s delusory belief system on view early.
1995 Neil Kinnock on Blair to Campbell: ‘He’s sold out before he’s even got there …….tax, health, education, unions, full employment, race, immigration, everything, he’s totally sold out. And for what? What are we FOR? It won’t matter if we win, the bankers and the stockbrokers have got us already, by the fucking balls, laughing their heads off.’ p. 78
This is the Neil Kinnock members of the Labour Party chose for leader, only to see him disappear as the 1987 General Election approached, and Patricia Hewitt and Peter Mandelson persuaded him to try and appear ‘statesmanlike’.
1996 January 7-16 ‘TB felt he was onto something with the stakeholder economy idea…..it was pretty clear that GB did not believe in the basic stakeholder economy message at all, or, if he did, he was determined not so say so…..GB was on the Today programme and did OK, but anyone who knew him could tell that was deliberately emphasising opportunity economy rather than stakeholder economy.’
The ‘stakeholder’ idea, most prominently promoted by Will Hutton, was New Labour’s last gasp of radical thought on the economy and it was abandoned because of hostility from the City of London. And here we are told it was Gordon Brown who was doing the City’s bidding.
1996 ‘TB called from Sedgefield….he said the key to it all was keeping JP [John Prescott] on board’.
It was Prescott who told the key TUC conference to ‘Give these people a chance.’ If any single individual is to be blamed for the Blair years it is Prescott.
1998 ‘The cartoonists were into me as well now. TB said he didn’t fear them coming at him about me, but about the relationship with Murdoch. And he didn’t fancy a sustained set of questions about whether Murdoch lobbied him.’ p. 287
Predictably, no-one in the political system put a sustained set of questions about Murdoch to him.
2000 ‘He [TB] wanted to say at some point why it had been right to keep the best (sic) of Thatcherism…….we had to make people feel that just because they had voted Tory during the eighties, it didn’t make them bad people……..TB said “What gives me real edge is that I’m not as Labour as you lot”….In another conversation later, he said the problem with schools was uniformity of teaching. I said the problem was the background of poorer kids and he just rolled his eyes at me.’ pp. 467/8
Schools policy explained in a sentence. Blair rejected (or is simply unaware of) 50 years of research which showed that background (i.e. essentially class) was the key determinant of educational outcomes. So teachers produced a million lesson plans seeking uniformity of teaching, faked their exam results to meet government targets and the class differences in performance remain.
2001 ‘TB…..felt we had to keep the Liberals to our left on some issues and hope that the Tories try to come towards the centre on Europe but right on other issues.’ pp. 550/1
So-called triangulation, learned from the Democrats.
2002 ‘Murdoch was coming in for dinner….Murdoch was at one point putting the traditional very right-wing view on Israel and the Middle East peace process……Murdoch said he didn’t see what the Palestinians’ problem was….’ p. 603
The world’s largest owner of media doesn’t know what the Palestinians’ problem is……
2002 In a Cabinet discussion on attacking Iraq, ‘TB said he believed it would be folly to go against the US on a fundamental policy.’ p. 640
Campbell thinks the same but neither of them spell out why it would be ‘folly’ (and they never have, to my knowledge).
2003 During the ‘dodgy dossier’ fiasco: ‘I spoke to Omand [David Omand, Security and Intelligence Co-ordinator] who, like everyone else, was feeling that DIS [Defence Intelligence Staff] were responsible for the briefings.’
The DIS staff, who had some technical expertise and didn’t believe Iraq had WMDs, had been deliberately excluded from the process of compiling the ‘dodgy dossier’.
These extracts do rather sum up ‘the [getting elected] project’: Thatcherism; stick to America and Murdoch; do what the City wants; keep Prescott on board to reassure the unions and the proles; keep to the right of the Liberals.
Notes
- ‘We’re on wealth creators’ side’, The Daily Telegraph, 20 July 2007.
- Thus the formation in November of the UK National Defence Association, led by three ex-chiefs of the defence staff, to campaign for more money for the British military.
- Melissa Kite and Richard Gray, ‘During floods crisis, DEFRA paid advisers £1 bn’, Daily Telegraph, 28 October 2007.