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Phil Collins

Leader writer

The obituaries of the new Labour period in office are already being written, even though its time has only just passed. Politics always requires that you tell a clear story about what you are doing. In truth, in the maelstrom of internal conflict and external pressure, policy formation is often driven by scandal and panic as much as it is by principle and forethought. Much of the policy work the Labour Party did in opposition turned out to be inoperable. Policies enacted spawned unintended consequences. Then events occur that come to define the period in office that were never part of the original prospectus.

All that said, it still makes sense to divide the Labour period in office into three parts, broadly corresponding to changes in approach. The first period lasted from the golden glow of May 1997 until the winter crisis in the National Health Service in 2000. The failure of extra money alone to improve the service prompted the second, most fruitful, period of government between 2001 and the departure of Tony Blair from office in the summer of 2007. The premiership of Gordon Brown then marks a third phase in the Government, in which the pace of the second was slowed.

When the Blair Government was elected in May 1997 it came to office with a long history of policy development behind it. In office, though, it exhausted that preparatory work quite quickly. The granting of independence to the Bank of England was the most conspicuous policy, but really stood alone. There were three themes during this period in government. The governing idea of the administration was supplied by Mr Brown: the idea of work. The New Deal for the long-term unemployed, funded by a levy on the privatised utilities, and the introduction of tax credits to supplement the wages of those in work, heralded, it was said, a return to the idea that work was the best form of welfare.

The second notable theme of the first period was constitutional reform, although the half-hearted and incomplete programme indicated ambiguity on the part of senior personnel, not least the Prime Minister himself. Still, the devolved assemblies for Scotland and Wales are now a part of the political landscape accepted by all parties and the argument about the House of Lords is how to finish off Labour’s near-abolition of the hereditary principle, rather than how to reverse it.

In the public services, the Government’s strategy, which was essentially command and control from the central State, was well-equipped to deal with deep failure. There had been, for example, no progress on literacy for almost half a century. Placing a team in the department to force through curriculum change was an old-fashioned, and for a time very effective, use of state power. Hundreds of Public Service Agreements were set. The regimes of inspection and audit were toughened and the publication of information about services became commonplace.

The time ran out on this approach when the Chancellor of the Exchequer released the grip he had hitherto held on spending. The Government had come to office determined to shed Labour’s historical association with profligacy. Mr Brown had, for that reason, submitted to the spending plans he had inherited from his Conservative predecessor. The paradox of releasing that restraint, though, was that it called forth the need for reform.

The standard Labour analysis, throughout the Thatcher and Major years, had been that there was not a great deal wrong with the public services that a lot of money could not put right. To some extent, that was true. Teachers, nurses, doctors and police officers had all fallen behind in the pay scales, relative to their professional counterparts in the private sector. Schools and hospitals were in a dilapidated state and the system was rationing provision in the only way it could – by queues. It was obvious that extra money was going to be part of the answer. That it was not the whole answer became clear when the money started to pour. The Prime Minister, late in 2000, realised that the analysis he had inherited from opposition was wrong. He realised too that the provision of extra money was a necessary accompaniment to the difficult reforms that, it was now clear, were needed.

The second phase of Labour government was dominated, in the coverage at the time and by the accounts of it since, by foreign policy. The terrorist atrocity on September 11, 2001 confirmed in the mind of the Prime Minister something that he had defined in a speech in Chicago in 1999: that terrorist threats could no longer be contained within national borders and that, therefore, the definition of what was in Britain’s interest had to be hugely expanded. The attacks on Afghanistan and Iraq were the immediate consequences of the Chicago doctrine, applied to the terrorist attacks.

The last word will probably never be said on these decisions but it is not true that foreign policy meant that the Government’s domestic momentum was lost. On the contrary, it started to speed up. Changes to the healthcare system began in earnest. The internal market bequeathed by the Conservatives, which Frank Dobson had torn up, was remade. A tariff was introduced to apply to procedures to change the incentives in the system. Private companies were encouraged to offer their services and patients were given a choice of which hospital to go to.

In education, the gradual demise of what Alastair Campbell famously called the “bog-standard” comprehensive began. City Academies, free from local authority control and aided by bequests from philanthropists, made the schools system more diverse. Again, the ideas inherited from the Major Government, which had been vanquished in the first term, were revived. Much to the chagrin of the Labour Party, which contains more than its fair share of defenders of municipal accountability, a new model school was established: independent and not wholly funded by the State. The dispute between the Labour leadership and the Labour Party reached a head over the 2005 Act, which sought to establish a new cadre of independent state schools. After a bruising battle, a very much diluted Act passed into statute, to no great effect.

Over time, a model of public service reform had developed that came to define the Government at its most radical. Pressure on the provider of the service came from three sources: from the users who could choose to go elsewhere; from the central State, which set targets for performance and ensured that services were audited and inspected; and from the threat that any failing institution would be subject to losing its franchise in competition with a private company.

The practice always fell some way short of the theory, not least because few Labour MPs could be assembled to agree with it. A more comfortable phase began when Mr Blair left office and was replaced by Mr Brown. Although, ostensibly, there was no serious change of direction, the Government slowed everything down. The reforms in health were slowed almost to a standstill. Education policy was almost entirely derailed by a crisis in child protection with the aftermath of the dreadful case of Baby P, a boy battered to death at the hands of his mother, her boyfriend and their lodger despite repeated visits by social workers. Only in welfare did the radicalism of the second phase continue as James Purnell tried to add greater conditions to the receipt of benefits and tried to widen the range of suppliers of welfare.

In a sense, the third phase of the Government brought it full circle. The emphasis during the Brown years on a multitude of small initiatives driven by central targets, now rebranded as guarantees, and the evident reluctance of the Government to open up the health and education markets were reminiscent of the Government’s stuttering beginnings.

Of course, just as the Blair years will not be remembered for the travails of domestic policy, so the Brown years will be recalled as the moment that the banking system almost collapsed. The banking rescue, the small discretionary fiscal stimulus and the recession were events of great economic magnitude on which the Government chose, unsuccessfully as it turned out, to fight the general election.

By the time of that general election the ideas that had sustained the Labour Party through more than a decade of government were widely felt to have been emptied of content. And yet this was only a half truth. In the Conservative policy on free schools, for example, there were glimpses of where second-phase Labour was trying to get to. The social liberalism of the coalition Government owed something to Mr Cameron’s desire to change his party, something to Nick Clegg and the Liberal Democrats, but rather more to the example of the Labour governments.

Phil Collins is a former speechwriter for Tony Blair