The King's Speech and Labour's strategy

Analysis of Labour’s strategy, which frames the coming King's Speech, by my Risk and Opportunity group

The State Opening of Parliament will take place on Wednesday 17 July, hearing the first King’s Speech of this Labour Government.

That Gracious Speech will only be properly understood through the lens of Labour’s strategy. So today I’m publishing my paper reported by the Telegraph in December:

Minister warns Rishi Sunak that Labour is outflanking Tories on the Right

Minister warns Rishi Sunak that Labour is outflanking Tories on the Right, Telegraph

Labour aim to become the natural party of Government by manoeuvring to the free market right of the Conservatives.

I will return in September with more analysis of their strategy, tactics and progress. In the meantime, the following is the text of a paper prepared by my Risk and Opportunity Group of advisers.

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Risk and Opportunity: Analysis of Labour’s Strategy

Background

Prior to Blair’s election as Prime Minister in 1997, Britain had undergone significant change.

Following the devaluation of the pound in 1967, the IMF loan of 1976, and the Winter of Discontent in 1978-9, Margaret Thatcher had become Prime Minister in 1979. Enacting a market oriented agenda, the Conservatives were trusted by the electorate to control public expenditure whilst opening up British industry to more competitive global forces.

It is against this backdrop that between 1979 and 1997 the Thatcher and Major administrations promoted varying degrees of privatisation, deregulation and contracting out of services whilst they also abandoned exchange controls and significantly reduced the marginal rate of income tax.

However, at no stage were the Conservatives trusted by the electorate with the human services of health, welfare, and education. So, instead of modernising them, the Conservatives instead showered them with money to win electoral favour. It was a strategy that worked for a long time.

Tactics of New Labour

Under Tony Blair’s leadership in opposition between 1994 and 1997, the Labour Party adopted a new approach and successfully outflanked the Conservative Party by appealing to many floating voters on the right of British politics.

They did this by embracing the tenets of economic Thatcherism but often going much further in key areas of policy – especially in the human services. Determined to out triangulate the Conservatives and win office, Blair’s team variously stole, repackaged, and created from scratch a new set of political atmospherics and policies that became known as New Labour.

Between 1994 and 1997, New Labour accepted the role of free markets, the need to balance the budget and talked about a future in which the human services would need much greater private sector investment and know how. Between 1995 and early 1997, their announcements were relentless in the national press and media.

While New Labour in opposition talked about an independent Bank of England, keeping to the Conservative’s public expenditure plans, maintaining PFI (but calling it Public Private Partnerships) and modernising the human services, the Conservatives looked out of touch and somewhat bewildered by choosing instead to suggest that Blair was an unreconstructed Marxist and with demon eyes: “New Labour, New Danger”.

Blair was elected to office and re-elected because he made good on his word. Under Prime Minister Blair, New Labour took a penny off income tax. It gave greater independence to the Bank of England. It modernised higher education by introducing tuition fees. It substantially reduced public sector debt. It adopted a vast programme of public-private partnerships across the NHS. It signed a Concordat between Britain’s 220 private hospitals and the NHS. It went to war with a right-wing US president in Afghanistan and Iraq. It introduced semi-private Academies and Free Schools. It laid the foundations for the upgrading of Britain’s independent nuclear deterrent and the building of four new Dreadnought Class SSBNs. It even allowed the introduction of road pricing in London, a policy that had previously been championed by the Institute of Economic Affairs and the Adam Smith Institute.

Keir Starmer

Today, Keir Starmer is repeating New Labour’s strategy and tactics. Informed by key members of Blair’s network and activists from the ‘British American Project’, Starmer has already outflanked the Conservatives on the right.

Today, Labour is openly talking about controlling public expenditure whilst complaining that both taxes and immigration are too high. Repeating Blair’s tactics, Labour are openly welcoming the private hospital sector. The idea of building more homes on the green belt. Wanting a higher proportion of private home ownership. Proclaiming YIMBISM. Talking about learning from Singapore and Australia when it comes to the NHS.

Meanwhile, the Conservatives continue to try and make socialism work with their parlous record of high taxes, national indebtedness, and near universal public sector failure and squalor.

What does all this mean?

As 2023 ends, the evidence is clear. Week in, week out… Day in, day out… Starmer’s New, New Labour are moving to the right of the government in key areas.

Already, Labour has won a high degree of manoverability on the electoral battlefield and has the freedom to dominate. This is why they are leading 20% in the opinion polls and building a trusted relationship with many voters.

The closer we get to the election, the more freedom Starmer will be granted by his power hungry colleagues to gradate and adjust policies further. Just because Labour seemingly favour VAT on independent school fees today does not mean this policy won’t be reversed in a few months. After all, this is exactly the sort of ‘killing ground’ tactic Blair used while in opposition.

It took the Conservatives between 1994 and 2006 to work out that Tony Blair and the Labour Party had changed and would go on being relentlessly right wing in their political atmospherics. This is important, because only when the penny finally dropped did David Cameron devise an effective counter strategy.

How long will it take this time? How much ground and outflanking must occur before No.10 [as was at the time of writing] wakes up to what their adversary is actually doing?