Ed Miliband is facing a damaging revolt by North-East Labour MPs who believe his economic rescue plans for the region are feeble and doomed to fail.
Senior MPs argue a ‘growth review’ – led by Lord Adonis, the former transport secretary – will repeat the Coalition’s blunders and fail to deliver the power and money badly needed.
They are urging Mr Miliband to bring back a slimmed-down development agency and, crucially, install a powerful figure in Government to “drive forward” key North-East revival projects.
But they also fear their pleas are being ignored by the Labour leader’s top team – condemned as a “Corpus Christi Oxbridge crowd” by Nick Brown, the former ‘Minister for the North-East’.
Mr Brown, the Newcastle East MP, said: “It will end up with the councils simply asking for money for specific projects – and that’s the worst possible position to be in.
“What’s needed is a development agency that can identify specific projects and drive them forward, working with a figure in the government with specific responsibility for that.”
Mr Brown said his concerns were shared by the majority of North-East Labour MPs, but added: “I’m not convinced our message is being listened to at the top level of the party.”
The criticism was echoed by Kevan Jones, the North Durham MP, who said: “The Adonis review lacks vision and ambition.
“The problem is that it is all about structures, when we need direct action and a minister at a senior level. We can’t expect councillors to pick it up, when their budgets are being squeezed as well.”
The revolt follows Mr Miliband’s acceptance, in April, of Lord Adonis’ draft growth report, with a final set of proposals due to follow next month.
The blueprint adopts the Coalition’s strategy of devolution to ‘combined’ authorities – such as the one covering Durham, Tyne and Wear and Northumberland – and poorly-funded local enterprise partnerships (LEPs).
The pill was sweetened by a pledge to devolve twice as much cash – £4bn a year – as well as extra responsibilities for welfare, apprentices and housebuilding, but not over inward investment.
Mr Brown said the key weakness was that the structure lacked a focus on economic development, as well as an ability to ensure key projects go ahead.
Recently, the outgoing head of the North-East LEP warned it had just six core staff yet it had responsibility for six, mainly £100m-plus projects.
Similarly, the Tees Valley LEP has warned it may have to abandon economic growth initiatives, because funds are not available.
Mr Brown said: “The means has become the ends. We have got the structures, but it is not delivering for the region – and nor is it likely to.
“If Labour simply picks up from where we are with the existing structures, we will continue to see the poor outcomes for our region that we currently see.”
He said he was not arguing for reviving the One North-East development agency, but a smaller body, chaired by a minister, “so the civil service takes it seriously”.
Mr Miliband has promised to bring back regional ministers – axed by David Cameron in 2010 – after MPs and councils protested they had nowhere to go, to raise crucial issues.
However, Mr Miliband’s office rejected the criticism, insisting there were significant differences with the Coalition’s approach.
A spokesman said: “The key difference is that Andrew Adonis is looking at devolving significant cash and economic powers. This would mean people don’t have to beg ministers for cash – as they have to now.”
Source – Northern Echo, 17 June 2014
This article was written by Toby Helm, political editor, for The Observer on Saturday 14th June 2014
The Condition of Britain study by the IPPR thinktank, to be launched by Ed Miliband on Thursday, will also contain proposals to devolve large amounts of power and funding out of Whitehall, including the control of housing benefit to councils, in order to stimulate innovative housing policies and more housebuilding.
The project was set up in February 2013 as part of Labour’s policy review to consider how institutions and policies need to respond to today’s needs – including more childcare and better care for the elderly – within the confines of tight budgets and inevitable further cuts.
A key theme is expected to be that early intervention at every stage of life can prevent society having to continue “paying for the costs of failure”.
> “early intervention at every stage of life” – now isn’t that an ominous phrase ?
The report will argue that a stronger society can be built on the three “pillars” of shared power, contribution (through changes to the national insurance system) and strong institutions. While some proposals, such as a plan to freeze child benefit to fund a network of children’s centres, are likely to be rejected by Miliband, many of its central ideas will be considered by the party’s national policy forum in July.
The report is expected to look at whether benefit payments can be linked more closely to levels of contributions through changes to the national insurance system.
Senior figures believe that Labour must counter the impression that it supports a “something for nothing” benefits system by looking at radical change.
> Oh great – so it’s all about image and trying to appeal to those sectors of the electorate who wouldn’t vote Labour anyway. And once again those at the bottom of the pile will get a kicking… just so Labour look tough, just like the Tories.
Not a single original thought among them, is there ?
Writing on theguardian.com, the chair of the policy review, Jon Cruddas, suggests that such ideas could form a major part of Labour’s manifesto at the 2015 general election.
Looking ahead to the report’s publication, Cruddas says: “It sets out three broad strategies for social renewal: spread power and responsibility to build democracy and strengthen society; foster contribution and reciprocity to re-establish a sense of fairness and justice; and strengthen our shared institutions to help tackle social problems for good. These establish the foundations on which we can build a competitive wealth-creating economy.”
The report will contain proposals for a one-off levy of £450m on Britain’s £180bn consumer credit industry which the IPPR says could create enough affordable lenders to take on Britain’s legal loan sharks.
It says that, as well as a new legal cap on the total cost of credit, Britain needs a new generation of not-for-profit lenders with enough capital to compete with firms like Wonga, Quick Quid and Payday Express.
The IPPR launch will be followed later in the summer by Andrew Adonis’s growth review, which will focus on developing the economic potential of cities. Richard Leese, the leader of Manchester city council, will then publish work by his local government innovation taskforce setting out plans to redistribute power across England and reform public services so that they can be tailored better to meet local needs.
Source – Welfare News Service, 15 June 2014