The Labour leader can show he’s serious about promoting ‘One Nation Labour’
Tony Blair chose to fight the Conservatives under the banner of “New Labour”. Ed Miliband, on the other hand, has opted to take on the coalition under the slogan “One Nation Labour”. Both are effective and make different points. The former stresses modernity, the latter unity. But both were born of the same essential need – to present Labour as a party not primarily, or even predominantly, of traditional, working communities mainly in the north, but as one able to unite the entire country.
Last week, former Labour cabinet minister John Denham sounded a Blairite warning at his leader, saying that if Labour was to win back power, it must talk, as Blair did, to the more prosperous south as well as to the less wealthy north. It must, he suggested, frame its appeal, bearing in mind the concerns of the Basingstoke commuter as much as those of struggling families trying to make ends meet in Manchester or Leeds.
Miliband’s task was always going to be hard in such an economically divided country. But the coalition’s austerity programme makes this task even harder. Austerity is hitting all families and communities in Britain (aside from the wealthiest 10%), but the north is being hit harder than the south for a host of reasons. More people are out of work in the north and so demand for local services is higher. Northern councils, strapped like others by cuts of 25% and more in their main central government grants, have also been hit by the disappearance of special funds that Labour targeted at deprived areas. And because property prices are lower in the north, so is the revenue those authorities receive from council tax.
Many urban local authorities are caught in the trap of rapidly rising demand for services and falling incomes. What is more, as benefit caps and council tax reforms are introduced from next April, the situation will almost certainly get worse. Today, in a letter to this paper, the leaders of three of the north’s biggest councils warn that if a stop is not put to the cuts soon there will be little or no civic society left. Instead, urban life, they say, will return to something more akin to the Victorian age, with a shrunken, unfunded public sector unable to meet overwhelming need.
Money is leaving the north quietly and heading south, not probably as the deliberate consequence of government policy but as an unintended result of the fact that economic success attracts success. The government’s New Homes Bonus scheme rewards councils in whose areas new houses are built. For every new home the council gets the value of a year’s council tax. But the fund is paid for by “top slicing” the central grant to all local authority by equal proportions. Because it is more profitable for developers to build in the south, and the demand there is greater, figures obtained by the Observer show that the top 10 net beneficiaries are local authorities in the south while the top 10 net losers are local authorities in the north.
The overheated south is winning again, stretching its economic lead. In such times, it is urgent that Labour should speak up for those who are losing out. If “One Nation Labour” is to mean anything, Ed Miliband must start to address the causes – and find some answers – as to why the north-south divide is widening, not narrowing, as we enter 2013.