Heidi Alexander pamphlet: distrust of Labour on economy is existential threat

Tax

Voter distrust of Labour’s use of taxpayers’ money is an existential threat to the party, and members who deny it by claiming the public are against austerity are flying in the face of evidence, according to a pamphlet co-authored by Heidi Alexander, the new shadow health secretary.

Liam Byrne, appointed a shadow home office minister, and Shabana Mahmood, the former shadow Treasury chief secretary who has refused to serve in Jeremy Corbyn’s shadow cabinet, also contributed to the pamphlet. Probably the starkest document yet to emerge from Labour’s election rubble, it underlines how hard it will be for Corbyn to send out a cohesive message when MPs, including those in his administration, are fundamentally opposed to his ideology.

It states: “Voters’ views are clear. They see Labour as an economically incompetent party, and they don’t trust us with their money. It’s as simple (and as complicated) as that.”

Corbyn made opposition to austerity a cornerstone of his campaign. But the Red Shift pamphlet, setting out the steps Labour must take to win power again, suggests: “We have to weave into our language, our narrative and our political mission a fundamental respect for taxpayers’ money, something that is clearly missing given our current reputation for profligacy. Labour will not and cannot get elected unless we’re trusted with the public’s hard-earned money. This failure of trust is an existential threat to the whole Labour movement.

“Some in our movement reject the urgency of this. That attitude flies in the face of evidence from multiple sources, including our own research. It is inextricably linked to our ability to build a majority in England, and thereby to form a government. It is a hard truth that cannot be ignored or wished away. It must be faced.”

The report is also scathing about the Labour general election campaign in 2015, saying: “With a leader that was behind on every indicator that mattered and a message that was all over the place, we never really stood a chance of winning in many seats.”

The report tries to map out some of the demographic and societal changes taking place, including a shift in employment. It points out: “In the UK, the annual earnings of self-employed workers are 50% lower than of standard workers. The Labour party should be the union for the self-employed. They are ‘our people’.”

It also warns: “Until Labour understands and embraces English identity, the SNP threat and proposals on English votes for English laws will continue to damage Labour’s electoral prospects in English marginal seats.”

At the same time, the party has to make proposals for the over-55s, with the report saying it was a demographic group to which Labour offered little. Yet it points out that older voters no longer see the welfare system as fair: “Overall, older voters do not think the ‘system’ gets the right help to the right people – or that we spend enough on the right help or support.”

It calls for the party to end the denigration of the record of previous Labour governments, saying: “Labour should say we got it 70% right: we kept interest rates and inflation low, rebuilt the nation’s schools and hospitals left to rot by Mrs Thatcher, returned Britain to full employment, ended pensioner poverty, invented the national minimum wage and tax credits for working parents to help lift a million kids out of poverty, and stopped a worldwide recession becoming a global depression.”

But the defence of that record should be balanced by an admission that Labour governments “were not tough enough with the banks, and were too slow to reform welfare and introduce the Australian points systems for immigration”.

Research for Red Shift claims the most popular changes to the welfare system included fairer tax relief on paying in for a pension (today most goes to the richest), a flexible retirement age (for instance, allowing retirement after fixed period of paying national insurance), tailored back-to-work support, and an increase in carer’s allowance.

Powered by Guardian.co.ukThis article was written by Patrick Wintour Political editor, for theguardian.com on Wednesday 23rd September 2015 22.00 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010