‘Capacity first: Building a Britain that works’

The political risks of targets have been laid out plain to see over the last 24 hours. Failing to follow through on a commitment to a percentage of GDP to be spent on defence has contributed to intense political chaos. Lessons need to be learned from this and preceding moments of this government where we have set targets and yet missed the point. The consequences for both security and prosperity for the country are severe.

Government bureaucracy at all levels is shaped and guided by targets. From cancer waiting times to major infrastructure projects, targets can be helpful. They sharpen focus, signal intent and create accountability. How else would a Minister be able to stand up and say a project is “on time and on budget” or, more often, have to explain why a project is “late and over budget.”

However, over-reliance on targets can lead to them becoming a single point of failure, leading to two main problems. First, when they are routinely missed, they become irrelevant. NHS Scotland A&E waiting times haven’t been achieved in years, demonstrating their failure to drive improvement. Second, targets become substitutes for strategy or capability, resembling Soviet manufacturing targets. More tractors, less food.

Already in government, we have fallen into this trap, deciding a fiscal objective but not the capability. Recent examples have been across key areas such as defence, welfare and energy.

READ MORE: ‘Healey and Carns are gone. Labour must finally get serious about national security’

In defence, the debate shifted from the Strategic Defence Review (SDR) in 2025, focused on capability, to a target driven conversation about how and when the UK will or should spend 3% and 3.5% of GDP on defence. By substituting the capability for the fiscal target, we have created a perverse incentive to spend money not improve capabilities.

This is not an argument against increased defence spending, far from it, but the strategic environment has shifted rapidly. If spending money is your sole point of failure, then you might spend billions on expensive things but not increase our capability.

If we continue to focus on having the right capabilities, we will also achieve our spending targets. The order of priorities matters for delivery.

We see an even clearer warning of the problem in attempts to reform welfare. There was a clear need to reform our outdated, cruel, ineffective and wasteful welfare system, to provide a better safety net and help people get in to and maintain being in work. A programme of reforms that would have enjoyed strong support from the PLP and it would also have achieved the desired cost savings as well.

Instead, we allowed the debate to be driven by a fiscal target. A single need to cut the welfare bill by £6bn. That put the fiscal target first and the human and economic outcomes second. It limited the scope of reform that could be delivered and the timescale to deliver it. Our refreshed approach on tackling the moral scar of youth unemployment shows how important it is to focus on outcomes and how the changes will improve lives as well as reduce costs.

A capability-led approach will mean savings would be the result of a system that works better, not the constraint imposed before it has been properly designed.

READ MORE: ‘Britain’s industrial strategy must start in places like Cornwall, not Whitehall’

Energy policy provides a third and equally important example. Decarbonising our economy and our society is essential. A target of clean power by 2030 can play an important role in mobilising investment and signalling urgency. However, an excessive focus on one target risks narrowing policymaking, limiting the ability of the market to innovate, increase efficiency and improve outcomes.

A modern energy system must do more than simply deliver clean electricity on a given timeline. It must also be reliable, affordable, and secure.

If success is judged primarily against a clean power 2030 target, demand reduction, flexibility, energy security or skills could be edged out because they are less visible than new generation.

Success in government requires clear discipline. First, define the problem. Second, identify the capability required to solve it. Third, align resources accordingly. Only then should targets and measurements be set. Targets are tools, not ends in themselves. You can hit a target and have failed or miss a target and have succeeded.

The cold hard politics of this is that we will not win re-election by ticking off targets and presenting them to the electorate as proof of success. Politics is about emotion and change people can feel, not just metrics ministers can cite. Voters will know if we have strengthened national security, helped people in to work and modernised our energy system.

If we campaign on targets not capabilities, we risk lecturing the public not leading them.

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