To restore voters’ trust in mainstream liberal democracy, Prime Minister Keir Starmer’s administration has to deliver the change it promised in opposition. To do that, the government needs a new approach to power.
It needs to decide who has too little power, who has too much, and how it is going to fix that. This will require a clear appraisal of the ideas that cast necessary change as politically ‘impossible’, and the bravery to take on such ideas and those who enforce and promote them.
And to act on this, it needs to inhabit and wield its own power more effectively. This will require radical reform of the state.
This report explores how power is distributed across the public and private sectors, the ideas that underpin this, and how they need to change, on the basis of a new theory of power.
Chapter 1 uses polling and other evidence to sketch out the public’s current, toxic theory of power, its implications for democracy, and why a new theory of power is needed to drive change and show that mainstream democratic politics can deliver.
Chapter 2 draws on history and political science to develop this new theory of power: how old fears hem politicians in, and how a broken status quo can be replaced by a new normal based on more pressing priorities. It also explores apparently neutral ideas, such as quantification and administration which rely heavily on rules, which fix the status quo in place, and which an effective government must interrogate.
Chapters 3-6 then trace this process through four key areas of public life to show how this thinking both centralises and disperses power. In broad terms, power has been sucked out of local government and autonomous institutions and up to the national level – only to be dispersed again within the broad centre of power, across public and private sectors, to the point where responsibility sits in so many places, it sits nowhere. This combines the downsides of both the centralisation and the dispersal of power. These chapters examine how the current government has challenged this so far, and what more it can do to escape the broken status quo. Each chapter focuses on an example of the same basic historical process of power shift laid out in Chapter 2; they can therefore be read in any order.
Chapter 3 concentrates on the power of the Treasury, the Bank of England’s Monetary Policy Committee (MPC) and the Office for Budget Responsibility (OBR). It argues that these organisations have institutionalised a distrust in the ability of politicians to handle the public finances which is based on particular ideological beliefs about the state, as entrenched through the 1976 International Monetary Fund (IMF) crisis and ‘Black Wednesday’ in 1992. This institutionalised distrust excessively constrains the role of principled political judgement, and erodes trust in
democratic government.
It recommends that the government:
Chapter 4 focuses on the power of large corporations and their major shareholders. It argues that outdated concepts of shareholder primacy, alongside legally questionable claims about the need to prioritise fiduciary duty above duties to all other stakeholders, have helped to concentrate ownership and power. This erodes public trust in democratic government, impedes growth and deprives the state of tax revenue.
It recommends that the government:
Chapter 5 draws together the privatised utilities, outsourcing and consultancies. It argues that 1970s beliefs about the self-serving nature of civil servants and unionised workers, and about the inherent inefficiency of the state, led to increasing reliance on the private sector to deliver what were once core state functions. This has generated a cycle of dependency, eroding state capacity, and has dispersed power and responsibility, damaging democratic government’s ability to deliver its promises and protect the public interest, in turn damaging public trust.
It recommends that the government:
Chapter 6 explores the confluences of two controversial policy areas that concern where people get to live – the European Convention on Human Rights (ECHR), and housing and planning policy – alongside a legal mechanism relevant to both: judicial review. It argues that in housing and planning, we have entrenched the state’s power to block and dissipated its power to build. More broadly, we have come to rely excessively on systems of rules, rather than democratic political judgement. The importance of protecting our fundamental human rights should be self-evident; the best way to restore the legitimacy of the existing system is to reform it, to ensure it achieves a fair and broadly accepted balance between the rights of the individual and the capacity of the democratically run state to govern on behalf of the public.
It recommends that the government:
These and other recommendations are all designed to be in pursuit of the goals set out in the conclusion: that it is now urgently necessary to reject the idea that the democratically run state is inherently inefficient, and to restore trust as a central principle in intra- and inter-organisational power relationships. It proposes a three-step approach:
Step 1: Reject the claim that government is the public’s enemy
Challenge and overcome outdated fears that block necessary action. Recognise that given the crisis of public trust in democracy, caution is often as risky as risk. Accept criticism of state failure and drive radical reform, but always on the basis of restoring the standing of the democratically run state as the public’s representative in national power struggles.
Step 2: Reassert democratic political power,
as enacted through the state
Replace rules, projections and a fear of uncertainty with confidence expressed through principles, and a greater role for trust and direct personal responsibility.
Step 3: Side with the public against its
powerful enemies
Call out the ways private power disempowers the public, and demonstrate that the democratically run state is the antidote. By confidently reasserting the legitimacy of public power, expressed through the state, the government can seize a once-in-a-generation opportunity to shift power in ways that improve working people’s lives.
