................................................................................ ON THE RECORD GORDON BROWN INTERVIEW RECORDED FROM TRANSMISSION BBC-1 DATE: 27.2.94 ................................................................................ JOHN HUMPHRYS: Terry Dignan - our man in the Town Halls. Next week we'll be looking at the battle outside London. Remember the prawn cocktail offensive? That was when the Labour leadership tried to win over the capitalists as a prelude to winning the election. Well they're doing it again, only this time they're offering to share money rather than lunch. The deal is that the State and private business should get together and jointly finance infrastructure projects, such as roads and railways, and perhaps much more besides. With me is the Shadow Chancellor, Gordon Brown Mr Brown, an old party in new clothes or a new party with different values? GORDON BROWN: What's new is the reassertion of Labour's lasting values. What's new is the application of them to a new generation, to new challenges, to new times, and what therefore is new is a new policy agenda that flows from it, and whether it's using private finance to increase the level of investment in our economic and social fabric, or it's our university for industry which is to increase investment in people and therefore revolutionise workplace education, or our new proposal for investment agreements between industry and the financial institutions. The key question is how we mobilise the resources of this country both to achieve economic growth and social justice, and underlying everything that we're doing is a new fairness agenda for Britain that is based on our underlying values - that the job of government is to ensure that there is fairness and opportunity for everyone. In other words that people have an equal right to realise their potential to the full, so the fairness agenda which I'd like to explain is completely new in British politics and it's us applying our lasting values to new circumstances. HUMPHRYS: The criticism that's been made of this partnership idea, getting private finance involved, is that it's reall not much more than a device, that it hasn't got a lot to do with the fairness agenda in the broader sense, but it really is a sort of device for getting more money, for raising more money, for kind of side-stepping the PSBR, so that you don't appear to be borrowing more money. BROWN: Well, of course we want to increase the level of investment in our social and economic fabric. Everybody who looks around Britain sees the mess that is going to have been left by Conservative rule, but the important principle is this: that instead of the old battle between public and private sector, Labour at some occasions supporting public funds, only public funds - the Conservatives always insisting on privatisation - what we're saying is we've got to use the energies of both public and private sector to achieve our basic objectives. Now it's the basic objectives that matter, a fairer society, economic opportunites for everybody, people having a chance to realise their potential to the full, and the distinctive feature of Labour is that we are prepared to use the power of government in every respect if necessary, government as an enabler, as a co-ordinator, as a catalyst, and not just as an owner, an employer, to achieve that. And if I were to explain to you that the fairness agenda for Britain is not simply about progressive taxation, that is important to Labour and will always be important to Labour, but to achieve fairness and opportunity for everybody. First of all we need employment opportunity and that is the biggest challenge that every government faces. Secondly, we need to increase people's earning power and that's why we've got to enact the skills revolution, that's the way that we can bridge the gap in the wage structure between low pay and high pay. Thirdly, we need to release people from dependence on the welfare state and give them financial independence, and that's particularly relevant to single parents. Ninety per cent of single parents work in Scandanavia, only forty-six per cent in Britain and that's because of the absence of childcare and training. Fourthly, we need to tackle vested interest in our society, and that means tackling the monopolies that exercise inordinate power over people's lives, dealing with the banks and financial institutions. Fifthly, we need modern public services, and sixthly, we need the growth that I've been talking about for two years when I've been Shadow Chancellor. Now that is the new agenda for fairness and the important thing is that we are using the power of government in the different respects that I'm talking about to achieve that, so it's not a battle between public and private. It's using the resources of both to achieve one of the most fundamental objectives, and that is a fairer community, a prosperous economy, rebuilding our industrial base by the extension of economic opportunity. And that fairness agenda is also the growth and economic agenda for this country that's actually going to create the wealth that is absolutely essential to fund our public services. HUMPHRYS: But you're not going to be able to do any more than talk about that agenda, unless you're in power, and you'd accept wouldn't you that's you're not going to be able to get into power unless you can persuade people that the image they may have - certainly if they're the
floating voter who doesn't much want a Tory government, that is deeply uncertain about you - the image they have of your party as being the party of big spending and high taxation is wrong. You have to disabuse them of that don't you? BROWN: Well, I've made it absolutely clear sometimes I'm unpopular in the party for saying so - that we will not tax for taxation's sake, that we will link the decisions on tax to the benefits and opportunities that people receive and we will be fair in our decisions about tax. In other words we put the decisions about tax back to our basic values. How do you extend opportunity, how do you create fairness for people and how do you relate your tax decisions to what's happening in your economy as a whole and, if I may say so, the Conservatives have got into a position where they're actually taxing more and spending more because of their economic failure. It is their failure to achieve the growth that we seek to achieve that has brought them to a position where against their wishes they're now a high tax and high spending party. HUMPHRYS: But you've gone a little bit further than you've just suggested. You've actually said you want to cut taxes if possible. If you can do that, that's what you're in favour of doing. BROWN: Are you saying that any Labour chancellor has got to say on all occasions that there's no circumstances in which he's going to cut tax. HUMPHRYS: Of course not, but the ... BROWN: But the important thing to recognise is that now that the Conservatives have been entirely exposed by the Labour Party for what they've done on tax, that the real divide in British politics is not between low tax under the Conservatives and high tax under Labour - the real divide is between fair taxes under Labour and unfair taxes under the Conservatives, and my fairness agenda with my emphasis on progressive taxation, our opposition to VAT, dealing with huge tax loopholes, millionaires who pay no tax whatsoever is all about re-establishing these principles of fairness in British society and in British politics. And the Conservatives simply cannot be anything other than the party of dishonest, high, and now of course, unfair taxation in our country. And that's why we'll win the next election, because people will be clear that the dividing line is between a fair party and an unfair party. HUMPHRYS: So you did mean it when you said you hoped to cut taxes - that was a clearly expressed hope. BROWN: Well, of course, the Chancellor's got to make his decisions in the light of circumstances, and one of our key priorities of course as we achieve growth will be to improve our public services, because we regard that as extremely important, both in health and education and in other
ways. HUMPHRYS: But you've got to get that growth first haven't you? BROWN: Yes, and that's why the important thing that I have been saying over the last two years is that the agenda for fairness that I have described today is also the agenda for growth. Basically we've got an economy that is too small, that there's been a failure to invest in people and in industry and in our social and economic fabric. The reason why that's happened is that the Conservatives don't see that there's a role for government and for intervention in achieving that, whereas I do, and that's why of course the private finance initiative of last week will help solve some of the problems of investment in our social and economic fabric. That's why my university for industry proposal, by revolutionising workplace education, will do what is needed to enact the skills revolution and that's why I'm able to say that in the modern world what contributes to fairness - that is investing in people, enhancing the value of people's labour and their skills - is also absolutely central to increasing the growth rate and the capacity of the economy. HUMPHRYS: Right. But to do that there has to be investment as you've accepted, commonsense that there has to be, and that's part of your appeal as it... if you get into office you're going to be making an appeal to private industry to private commerce, to private finance, to put money into partnership with you. You will have, yourselves, to put money in, so you're not afraid of borrowing more, whether it's through the PSBR mechanism or whatever, outside that, as you regard it, an unrealistic mechanism. You're not bothered about having to borrow more money, or are you? BROWN: No, I think we would be able to cut borrowing, because we would deal with the fundamental failure over the Conservative years ... HUMPHRYS: But not immediately would you, not in the very first stages, that's the point. BROWN: Well, look at what the fundamental failure of the Conservatives years has been. They said they would be able to cut pulic spending. In actual fact public spending is higher as a percentage of national income now than it was in 1979 - forty-four to forty-five per cent - and the reason that has happened is because they've failed on the economy. They thought that you could extricate decisions on tax and spending
from the general management of the economy. You can't do that, and what hasactually happened is that we're paying twenty-five billion pounds a year for unemployment, we're paying for low growth, half the rate of growth of many of our competitors, we're paying for social destitution and social deprivation under the Conservatives. Now you need a government that's first of all prepared to tackle the bills of failure, and we're prepared to do that, HUMPHRYS: If necessary ... BROWN: ..and secondly, a government with a clear strategy for growth and that's why I emphasise the long-term problem that's got to be solved in the British economy is that failure to invest in people and in industry and in our social and economic fabric and that's why the fairness agenda is also the agenda for growth. HUMPHRYS: But if I want to invest in a building society tomorrow, I've got to have the money to invest. BROWN: That's right. HUMPHRYS: And if you don't have the money on day one, you're going to have to raise it somehow or another. You say you want to get it partly from private sources, but you're not running away, or are you,
from the prospect that you would have to raise more money - at some stage. In the early stages of this process leading up to all those nice things you talk about you've got to get the money in haven't you? BROWN: Well, the key thing is achieving growth and as you know in the November budget I put forward proposals to raise funds that would lower unemployment and achieve high rates of growth. We'll come forward with whatever proposals are necessary by the time we get to the election. But let's just look at how you achieve higher investment in your economy and solve these problems of capacity and unemployment. My proposal for the university for industry is not a government financed institution. It's us using government as a catalyst to get business and industry and universities involved. My proposal for the training levy, which is also the proposal John Prescott and his predecssors have put, are employers making their proper contribution to training, and my proposal for investment agreements, which is bringing together the banks and the financial institutions with industry to make long-term agreements to solve the problem of short-termism in the British economy is not about government money, it's about creating the right relationships between business and industry and, at the end of they day, the increased level of investment is going to come from getting these relationships right and getting business moving in the same direction as government. HUMPHRYS: That's very different isn't it to a clear Socialist commitment to massive public investment - and you know where that phrase comes from - it comes from an early day motion which has been signed by a quarter of your backbenchers. BROWN: But you see, the dividing line between the Conservatives and ourselves is very clear. We are... HUMPHRYS: I'm now talking about the dividing line between you and some of your backbenchers. BROWN: But I'm trying to point out what perhaps that motion fails to understand. The dividing line is very clear. We're on the side of fairness and economic opportunities for all, and we recognise to achieve that that the key dividing line is that we are prepared to intervene, we are prepared to use the power of government to do so, and that doesn't mean that you always commit yourself to spend more. That doesn't mean to say that you don't look at the redistribution of existing resources and that doesn't mean to say you don't look at the contribution that the private sector can make. The key thing is how you use the power of government to achieve your objectives of fairness and economic opportunity for all, and I think we've gone back to these lasting Socialist values, applied them to what is essentially a global economy, with global financial markets as well as everything else, and come up with what is the makings of the new policy agenda, not just for 1995 and 1996, but for the new millennium. HUMPHRYS: Your success rests, does it not, on achieving the sort of full employment that you have talked about - full and fulfilling employment. If you fail to do that, you fail to get the growth, you fail fullstop, don't you? BROWN: Yes, but we're not going to fail because we've analysed the problem properly, we've looked at the experience of other countries, we're aware that in the modern world the failure to use the energies and resources of people who are made unnecessarily unemployed, is a cause of our economic problems as well as a consequence. If you don't invest in people in a world where raw materials can be bought from anywhere, we're in a world where capital can be bought at a price from anywhere, where inventions can travel across frontiers within the course of a year, what distinguishes one economy from another is the level of investment and the quality of skills and talent and any government that fails to recognise that - as this government does - is actually failing, not just this generation, but future generations. HUMPHRYS: Do you not accept then that the whole employment pattern in a country like Britain is changing. We're moving away from full-time jobs necessarily for everybody to a lot of part-time working for instance? BROWN: Well, I think what we mean by full employment is advanced, because what people are interested in is not just a job but in the quality of work they do and what women in particular.. HUMPHRYS: I'm sorry, I don't understand that. BROWN: Well, what women in particular are interested in is the flexibility that will come with the job that they do. They may want to move in and out of the labour force. HUMPHRYS: But what about the main wage earner in a family, for instance? BROWN: Yes, the main wage earner will want a good job and not just a job. They'll want the opportunities in a job that they find less attractive to train to get into a better job. We have always got to be creating a multiplicity of economic opportunities for everybody - for training and for work and the job of a modern government is actually to create millions of points of opportunity for people so that they can move from jobs as they seek to do so, so women can move in and out of the labour force, so that we recognise that where one job goes other jobs are available for people to do too. HUMPHRYS: But it might be a part-time job. It might be a relatively low-paid job? There might not be a full commitment, an absolutely hard commitment, to full-time jobs, full employment in this fulfilling sense.. BROWN: Yes, the modern way of doing this is to increase the quality of jobs on offer, of course... HUMPHRYS: Increase the number of jobs.. BROWN: Yes, the number of jobs and the quality of them but, at the same time, if people are in jobs that they find unsatisfactory we've got - through the university for industry, through other means - we've got to provide them with the training opportunities so that they can move from a job that they find less attractive to a more attractive job.. HUMPHRYS: It sounds slightly different.. I'm sorry, but it sounds slightly different to this sort of full commitment to full-time jobs for everybody... BROWN: Not at all. You recognise as I think everybody does, and it's particularly affecting women that we're in a changing
labour market, that flexibility must be a weapon that is not used by the employer against the employee, but something available to a woman if she wants to move in and out of work, if she wants new training opportunities to move from one job to another, and we have got to meet the demands and aspirations of some people who want part-time work and other people in part-time work who definitely want full-time work and we've got to give them these opportunities. So, the modern way of looking at things is to apply your values, which is fairness and economic opportunity for everyone, use the power of government to create these opportunities for people and, of course, it's not just an employment opportunity, but giving people the opportunity for skills and for training and education that matters. HUMPHRYS: Let me try and sum this up a little bit then. If I am that floating voter that I suggested at the beginning of the interview, what I hear you saying is that you would like to cut taxes, you hope to cut taxes, you're not interested in this massive public investment, straight off, you're not absolutely convinced that full-time jobs for everybody in the nation is going to be a possibility in the very near future... BROWN: I think John you misunderstand what I'm saying. I'm saying - look at the modern economy, we're living in a global economy, we have got to apply our fundamental lasting values, our commitment to fairness and economic opportunity for everyone, to these new conditions. HUMPHRYS: Yes, but... BROWN: And that opens up a completely new agenda which is a multiplication of economic opportunities for people - far more opportunities than people had before, but it can only happen if you're prepared to use the power of government to achieve them. HUMPHRYS: But this is the point - you say it opens up a completely new agenda and it may sound to some, it may sound to that floating voter and perhaps you'd welcome this, but what you're actually saying is we're not that different to the Tories. What we're going to do (let me just finish the question, you want to leap in at that obviously) what we're actually saying and if you say this briefly I'd appreciate it, we can manage better than the Tories, that's what we're actually saying - we can manage the country better. Not necessarily run it.. BROWN: We are prepared to intervene to create opportunities. The university for industry, technology trusts, investment agreements, the public finance initiative, all because we want to create a Britain that is fair, economically prosperous, where people have economic opportunities by the millions, and that is the challenge of modern government - to apply lasting values to new situations. HUMPHRYS: Gordon Brown, thank you very much.