What does Labour stand for when “there’s no money left”?

“There’s no money left”

It’s a phrase that will echo (mis)quoted down the ages. The Tories (and their yellow friends) continue to refer to that infamous letter, but what resonance does it have outside of the Westminster bubble? No-one ever mentions Liam Byrne on the doorstep (except presumably in his Hodge Hill constituency). The age of the epoch changing political gaffe is no more, it would seem, when our politics (and politicians) are so distant from a disinterested public. And that’s if you can even call Byrne’s note a gaffe – no-one has managed to argue convincingly that the sentiment he expressed was untrue…

It does however present an interesting (and difficult) question for the Labour Party – what do we stand for when there’s no money left? How do we create a winning policy agenda without relying on public spending? And is it possible for Labour to galvanise members and supporters without powerful messages built around major spending commitments?

It’s a question that goes to the very heart of what Ed Miliband’s leadership is all about. By nature Miliband is a European Social Democrat, and a Fabian. In an ideal world a Miliband manifesto would be about sharing the proceeds of growth, but if elected he is likely to inherit an economy starved of growth, and with much lower levels of public spending than the New Labour years. The odds of Miliband reversing Tory cuts seems slim. For Labour to return to traditional tax and spend with a weak economy would be political suicide. That’s not to say that Labour members and supporters – myself included – won’t be disappointed when the time comes for Ed to confirm that. There will – hopefully – still be individual areas of investment for us to be upbeat about – the NHS for example, or schools – but an across the board expansion of government spending seems unthinkable.

If that alone were the basis for the next Labour manifesto, the situation would be very bleak indeed. What Labour must offer instead is a new vision of how we live together, and a structural shift to a new economy and society. That’s obviously easier to say in a blog post than it is in policy terms, but there are signposts for the future in the actions in governments past. And whilst many of us in the party might revere the 1945 government, the 1997 government provides a much better road map for a “post-big spending” Labour Party. In particular the minimum wage and equalities legislation are ideal examples of the kind of society changing policy that doesn’t rely on a spending commitment.

It won’t be enough to rehash the ideas of the past though – we must build on them. The living wage (a Miliband favourite) is to be welcomed, but a far better idea would be to significantly raise the minimum wage to a “living” level. Gay marriage is the obvious and necessary follow on from civil partnerships – and may even be achieved under this government. But in addition to thinking beyond narrow alleyways of thinking on spending and the state, we’ll also need to think beyond narrow areas in which and means by which the state can operate.

We think that these kind of changes in society are not only possible, but necessary, and must form part of Labour’s next manifesto. That’s why from next week, we’ll be posting your ideas for Labour policies that don’t require a spending commitment, and putting those proposals to a vote at the end of the month. We can’t wait until the next election to develop these ideas – we need to start now, shape the debate, and make such ideas as mainstream as the minimum wage.

If you have an idea for such a policy – email us – and we’ll post the best ideas.

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