“New Labour should have been clearer that we cared about inequality”: The James Purnell interview

James Purnell is Member of Parliament for Stalybridge and Hyde, and former Secretary of State for Work and Pensions. He met Alex Smith on Thursday, February 11th, 2010.

You’re doing a lot of work at the moment on Labour’s ideology. We’re now effectively in the middle of a long campaign after 13 years in office. Won’t most people say – whatever you come up with – that it’s all too little, too late for this Government?
Well, it’s really picking up from the Guardian article I wrote a few weeks ago, and I hope it can contribute towards the manifesto. Having a clear ideological argument in the manifesto would be a good thing. But I think one of the things about New Labour is that we were scared of looking too ideological, because ‘ideological’ had come to mean ‘mad’; it had come to mean ‘extreme’, or sometimes ‘dangerous’. One of the realisations for me, though, has been that you can have a moderate centre-left ideology; it just means being clear about what your values are, what your ideas about society are and what your methods for getting there are. If you don’t have that combination, it can bring all sorts of disadvantages, both in communication and in how you use power.

My sense is that ideology can still be as divisive as it is constructive. While I think there’s a lot that can be done to renew Labour’s politics, a more urgent priority is in restoring trust…
‘Ideology’ is partly a word I’m using to make the point – but you could interchange ‘ideology’ and ‘clarity’. It’s an encouragement for us to try and have a system of thought; to try and remember where we’re trying to go as a party. That’s particularly important when you’re being buffetted by the press day in, day out. So you need to have a map of where you’re trying to go, otherwise you can end up zig-zagging. It’s not much more complicated than saying “let’s not be frightened of saying that these are the things we want to achieve and this is how we want to make them real”. But I do think in trying to do that, going back to what moral philosophers or political thinkers have said is actually very helpful.

A lot of the work that you’ve done with Demos and the Open Left project – and in particular with last week’s Society of Equals paper – has been about tackling inequality, and Labour’s apparent inability to do that. How important is tackling inequality to Labour’s argument as opposed to, say, fighting poverty per se, or increasing aspiration, or social mobility, or representative democracy? Where does inequality fit in to the broader picture of what Labour should stand for?
The absolutely central goal is about creating power for people in a reciprocal society. But you can’t have that if certain types of inequality persist. New Labour should have been clearer that we cared about inequality, but we should also have been clearer about which inequalities we care about. There are lots of inequalities in society, and there will always be inequalities. Many of them are difficult or unjustified or contestable, but you can’t solve all of them at one stroke. We’d have been much better off by first saying that the inequalities we believe to be most corrosive are child poverty, in-work poverty, corrosive disadvantage like drug addicition or long-term unemployment; and second that we’re going to set out clear, achievable goals for all of those. In a way we’ll restore trust by showing that we’ve achieved that. That’s not to say that there aren’t other types of inequality that matter or that don’t also have a corrosive effect, it’s just to say that these are the ones we feel it’s important to try and eliminate first. Crosland said that “people in ivory towers can argue about the exact definition of inequality, but we can see it in front of our noses every day”. That’s an argument about trying to be comfortable with the idea that inequality matters, but also being clear which ones you choose to tackle first, now, without distraction.

You say New Labour always cared about tackling inequality, that substantial and ambitious efforts and investments were made to those ends, but the National Equality report shows that the gap between rich and poor is continuing to grow. Why has New Labour been incapable of matching its investments with statistical success?
That’s sort of the point I’m making about being clear about which inequalities you’re focussing on and measuring yourself according to those. Graeme Cooke‘s paper on inequality goes through our record and compared to other countries we’ve actually got a creditable record: the Gini Coefficient, for example, fell in the early part of this century, and we were one of the only countries in the OECD to achieve that. There are increasing disparities of wealth all over the world. Polly Toynbee described it as trying to run up a down escalator: if you did nothing, inequality would naturally increase. But if you compare what Labour did in terms of taxes and benefits with what the Tories did, that line is completely in the opposite direction. Under Thatcher, the tax and benefits system increased inequality, while under us it’s reduced it – it’s just that sometimes it’s not reduced it enough to compensate for the natural increases which come from the market. So I say let’s be clear about the inequalities that matter and how we’re going to measure ourselves on those, because actually the figures which are quoted in the Gini Coefficient are relevant, but there are other figures which show a different trend. If you compare, for example, the inequality between the 10% poorest and the 90% richest, inequality has actually fallen. What’s risen is the inequality between the very, very poorest and the very, very richest, which is clearly something that can be debated and which the Government at some point might decide to focus on. What I’m saying is, as a way of dealing with the inequalities which are most corrosive, we should focus on child poverty, in-work poverty, getting people into work.

In your speech, you talk about “active equality”, about people’s own responsibiliuties in achieveing equality for themselves, rather than having it given to them. That’s intuitive: ideally, people want to take control over their own lives. But that’s too frequently impossible because of circumstances. What can the state do to help people help themselves; to give them a fishing rod, rather than a fish?
That’s a good way of putting it. Some people who hear this argument think that we’re saying this is instead of redistribution. Actually we’re saying this is the point of redistribution, but that redistribution is not the only thing that needs to be done. Sometimes people look at the Gini Coefficient – and they look at the evidence that inequality creates all sorts of problems – and say that if only we could address the Gini Coefficient, those problems would go away. Actually, we need to deal with the causes of why the Gini Coeffienct Coefficient ends up being the way it is. So you have to redistribute money to prevent child poverty; you have to redistribute money to make the welfare state more protective; I’m in favour of having a jobs guarantee so that people are not unemployed for more than a year; and we need to look at the school system and challenge the selection by mortgage which is going on at the moment in our system, which in many ways is worse than academic selection. So there’s a whole range of things you can do to give people more power, but then you should also say that people have a responsibility to take it up. So in the welfare system, I would say that if you have a jobs guarantee, you should also say people should take up that job when it’s offered to them, and that people have responsibility for the way their life goes in dealing with debt, or drug addiction problems, or whatever it might be. If you aggregate those problems, not only do you make it impossible to achieve the goal you’re trying to achieve in the first place, but you also leave out a huge part of what makes life worth living, which is people achieving things for themselves.

A High Pay Commission is something that’s been discussed in lots of different circles as a means of figuring out a solution to income inequality. Is a cap on high pay a positive thing for our economy, or for inequality?
When I’ve heard people discuss a High Pay Commission, they’ve tended to shy away from recommending it in the end. So I’m not quite clear whether a wage cap has become a symbolic thing, or whether it’s an actual proposal. I think a cap on high pay would be illiberal and probably counter-productive. I think the idea of Government – or anybody – deciding what the maximum pay should be is too much of an interference in the ability of society and the market to run themselves. But I do think we need to look at how we make sure that those processes are robust. In Graeme Cooke’s piece on equality he says we should be looking at how remuneration committees are constituted; at whether there should be an employee representative on those. I think if people are in this country they should be paying tax, so I think we should have a serious look at non-dom status. But if we’re looking at where we’re going to rebalance these issues, we need to think as much about wealth as we do about income. We haven’t thought enough about wealth. One thing Graeme does in his paper which I think is interesting is to look at how you can tax the receipts of inheritance, rather than the payment of inheritance. But should the Prime Minister be setting the maximum someone can earn in this country? I don’t think so, no.

Going back to “active equality”, you spoke in your speech about what the state can do to empower people. If I’m a kid whose parents are on disability allowance, who lives in a run-down council flat or overcrowded council house, whose passion is for music but who doesn’t have the means to practise that passion, what can I do as an individual to harness the state’s provision – because that’s where inequalities start from, isn’t it?
That’s why our child poverty goal is relative, rather than absolute: it’s about saying if some people in society are able to learn an instrument or develop a sporting talent, then other children should be able to as well. So as the income in society grows, we should be redistributing a share of that towards the poorer children. That’s where schools play a massive, massive role. But there has been a big change. If you go into a school now compared with ten years ago, you see a lot more music and culture. When I was at the DCMS, Ed Balls and I worked on a cultural offer, which means that everybody should be offered a lot more music and art. So that’s something that maybe people haven’t noticed, but where there has been a big change.

But if I want to be an accountant or go into a profession, in the same situation, there are numerous road blocks to my ability to be able to do that. So it’s not just about thinking about being creative in schools, it’s about having localised and personalised youth services.
I think it’s also about trying not to expect the state to do everything. I think we need to be bolder about correcting market outcomes. We came in in 1997 with a confident set of reforms around that: the minimum wage, trade union reforms – but we now need to rediscover that, because we ended up trying to do everything through the state, with tax credits, or schools, for example. The state will have a huge role to play in trying to tackle problems, but we ended up being a bit too hands-off with the market and too hands-on with the state. If we were more able to correct market outcomes – for example by having a living wage, or encouraging a living wage – then the state could do less, and it could do what it is doing more effectively. Similarly, I’d say let’s look at how we can build up the institutions within society so they can resist both market power and state power more firmly. In your example, in the accountancy profession, the state could look at working with reformers within the profession so that it could reform itself, rather than thinking the state can or should do all of that. We should be using the state, the market and society, rather than just the state.

Reading some of the things you’ve written about since you left the cabinet last June, it’s interesting to note a tangible, public tinkering to to your own ideology, and – dare I say it – a relative shift leftwards. Is that a fair comment?
Well, I’ve thought and talked a lot, and worked a lot in my constituency, and that has given me space to examine what I think. I think that, while there’s definitely left and right within the country, some of the ways in which left and right are defined within the Labour Party are more complicated. So welfare reform is seen as something which is right wing, but I’ve always seen it as profoundly left wing. If you think about it as trying to stop people falling into long term unemployment and the huge disadvantage that that causes, then having some conditionality in the system to get people back into work – as long as it’s done in a supportive way – I would say is a left wing thing. I guess I’ve been interested in going back to the Labour tradition, and remembering how vital it is, and how alive it is, for where we are now. If we go back and look at what Labour grew out of, some of that would be regarded as left wing within today’s Party debate, but other aspects – like values of thrift, of family, of place, of faith – would be seen as right wing. I would just like us to be more confident about what we believe – that’s the key. Sometimes those things will be seen as New Labour, such as welfare reform or pushing choice in schools further. Other things such as correcting market outcomes were there well before New Labour, which we continued in 1997, and at the start of New Labour, but were things we later moved away from. If you look at electoral reform, is that left wing or right wing within the Party? You can’t say. So I don’t like it when people say that left or right doesn’t mean anything in the country anymore, but I do think that within the party it’s more complicated than New Labour was right wing and everyone else was left wing.

Is there something particular to your life since leaving the cabinet that has made you want to reassess Labour’s values? You’ve already referred to being back in your constituency, but have you read more or listened to music more, or done something else that’s made you want to look again at these things?
The thing which I see most of all is the potential for community organising to turn empowerment from being a slogan which is nice in seminars into actual reality. Seeing that tradition more closely, I’ve noticed how much the Labour movement has walked away from it. There are of course brilliant examples of constituencies – Edgbaston, Mithcham and Morden – which are amazingly active, and if you look at Usdaw or other trade unions, you’ve got people going out and recruiting in the most difficult circusmstances. But if you think about us having a million members in the 1950s, and if you think about where membership is now – both in the party and in the trade union movement – or that only 15% of private sector workers are members of trade unions, you have to say we haven’t renewed the social capital on which our movement grew. So firstly, it’s struck me that this decline in membership has become accepted as an inevitable trend, when I don’t see any reason why it should be; but secondly that organisations like London Citizens give you the counter-example, that it is still possible to organise people – it just requires a lot of work.

But like London Citizens, those mobilised groups are so often single issue organisations, not party political organisations. Do you think the Labour Party – or any party – has the ability to harness some of that feeling in order to rebuild, or do you think there has to be a more fractured Labour Party which is more pluralist?
I think we can be more pluralist without being fractured. One of the things community organisation teaches you is that people can have different interests without falling out with one another. They can say these are the interests we have; this is where we can compromise and make progress; and this is where we’ll be in opposition to each other.

So that’s why you talk about the need to redefine and refind our values, because that’s the framework in which that type of relationship can occur and grow.
Yes, exactly, but it’s also about being confident that we’re Labour. The other thing I’ve noticed is the liberal-communitarian debate, the Rawls-Sandel-MacIntyre debate which has dominated Anglo-Saxon philosophy for a long time, I think in many ways was just the wrong turn. It had interesting debates within it, but actually those debates were very disassociated both from politics and from communities. It was very deracinated in a way, and actually I think there was a little bit of Labour where we lost our confidence after 1979. We lost our confidence faced with Margaret Thatcher, and then we felt that we needed to latch on to these ideas, when actually neither the approach laws of communitarianism nor the rules of welfare liberalism actually worked for us, because they weren’t as good an encapsulation of people’s values as Labour’s tradition at its best can be. Labour’s tradition is a much better encapsulation of people’s values than the Conservative tradition. So we need to have the confidence that the tradition of our Party has a huge amount to teach people now, but also get to the realisation that it will require a lot of work in the re-threading together of the Labour movement.

It’s interesting that you talk about what you can do on the ground, organisationally, because one of the criticisms that I have of the work you do – and that Colin Burgon shares – is that it’s all too academic, it’s too presentational. For instance “we can challenge concentrations of power and injustice, harnessing the state, markets and society where possible and curbing each where necessary”, which is something in your foreword to A Society of Equals, is great writing but it has no direct, real, tangible value. It’s more philosophy than policy; more PPE than PCT. Do you expect or hope that any spicific policy outcomes will come of this?
Well there are lots of policies in the speech and obviously I’d like all of them to be in the manifesto! But I understand that when you leave Government you have to tailor your expectations accordingly. But I think you have to do both the thinking and the campaigning; both the philosopshy and the organising. If you don’t think through clearly what you’re trying to do then the orgasnisation can end up with an outcome it didn’t want; but if you don’t have the organisation, you’ll do lots of seminars but not get anything achieved.

You talk about the difficulty impacting on the manifesto now you’re on the periphery, as it were. Do you feel like an outlier now? What confidence do you have that the Cabinet and those people writing the manifesto will listen to your ideas, other than your personal relationships?
People have behaved extremely well vis a vis me since my resignation. The cabinet’s communcation has been very good. I completely accept that one of the negatives about not being in Government is that you have less influence, but I hope these ideas stand on their own merit and that people look seriosusly at them. But if they don’t, then I’m not going to throw my toys out of the pram.

When you left the Cabinet, you said that Gordon Brown’s leadership made a Tory victory more, not less, likely. Since then, there’s been a ten point narrowing in the polls. So I wonder whether you still feel the same way, and whether you now think he can pull off an election victory.
I’ve never said that he can’t win an election, and indeed I strongly believe this is an election we should win. We’ve got a really good claim to re-election based on what Gordon and Alistair did on the economy – I think they will be seen to have prevented recession turning into depression. What we did on jobs has surprised some people in terms of what’s happening now with the unemployment figures. So given that record, I think we have a good argument for re-election. Also, if you look at the polls as to which party people identify with, 37% still identify with Labour and only 31% say they identify with the Tories. So I’ve always believed this is an election we should win and I’d be delighted if Gordon proved what I said in my resignation to be wrong.

Finally, there seems to be – if not regret – some understanding in what you’re saying that having a platform for promoting some of your ideas for renewing the Labour Party may require a more active, frontline role. Last summer you said you didn’t ever think you would return to frontline politics. Has that changed at all over the past nine months?
I’m really enjoying the Demos project and the grassroots stuff I’ve been doing. I’m proud of what I did in Government, both as an adviser for four years and as a minister for four years. But I’m not looking to come back into a frontline role. I hope that what I’m doing through these projects can make a difference, and I think there are lots of ways you can contribute to politics which are much wider than just being at the frontline. My first office after university is fifty yards form where my office is now, so the things that I’ve seen in the last year have reminded me that there’s a big wide world out there. I hope that perspective is something that will be helpful for the Party. So I’m happy where I am now.