Alison McGovern: Thank you for showing me lovely Newcastle, it’s been really great. Clearly people here have voted Labour, we had gains last year in 2015 when we didn’t win nationally. If you had to say, if I had to force you to say why you think more people came out and voted Labour in Newcastle and not less, what would you say that’s about?
We’ve had a very strong narrative right from the time when we took control of the council, that Newcastle Labour is on your side. That’s not simply an empty campaigning slogan. That’s about Newcastle Labour showing that it cares and acts on the issues that people are most concerned about. We also do that within a set of Labour values. One of the first things we did was establish a Fairness Commission to guide our work, but we see our task as standing up for our city in tough times, shielding the most vulnerable from the worst impacts of austerity, where we can, but also investing to make Newcastle a better city for the future. The kind of place that people will want to come and invest here, work here, and live here for generations to come.
Alison McGovern: Tell me about investment because, you know, my perception, sat here in Newcastle we are closer to the financial centre of Edinburgh than we are to the financial centre of London, and one of the issues that we have is about getting capital for growth. Yet, you know, Newcastle, you just sort of look around you and you can see the development happening. How has that come to pass?
I became leader of the council in 2011, and it was immediately apparent to me that there was market failure. People were not investing in the city, for all sorts of reasons, and I needed to send a message of confidence that Newcastle was a place that was open for business. One of our flagship schemes had stalled because the private finance had pulled out, so as a council we took the bold and brave decision to intervene and co-invested alongside a private sector partner to stimulate growth. In the short term that was about safeguarding and creating construction jobs, at a time when there was a real risk that a lot of the construction industry skills would be lost to the region, and once they’re gone they’re very hard to get back.
In the medium term it was about recognising that when we recovered from the recession businesses would need space to grow, and so we needed to create the right environment for businesses to expand. Longer term, particularly as councils lose revenue support grant and move towards a system of financed based only on business rates and council tax, we knew we needed to grow our tax base because that’s the thing that would make us more sustainable in the future. The council has been, under my leadership, taking investment decisions which are good for the economy of the city, good for the profile of the city, but also help the council’s finances in the longer term.
Alison McGovern: It’s really interesting to hear you talk about that, because one of the challenges we have as the Labour party nationally is obviously economic credibility. You know, not to kind of rehash all of our woes in May last year, but it was definitely a sense I think that we hadn’t managed to do the job to re-establish our economic credibility. If you were to, say the next Labour shadow chancellor, John McDonnell, rings you up and says, you know, ‘How can we re-establish our economic credibility?’ What would your answer be?
For me it’s about jobs, jobs, jobs. It’s about making sure that people have good quality jobs that enable them to put down roots in their community, feel a sense of pride in what they do, have self-dignity and hope for the future. When I grew up in the north-east in the 1980s and 1990s, the sense was that this was a region in decline, that if you wanted a career you had to move away. What I’m doing is in difficult circumstances using the council as a job creation agency, growing the economy, growing the sectors where we have strengths, making sure that there are sufficient career choices for people to be able to develop a career without moving away from this region, and attracting people into the region and growing our population. For the first time in four decades Newcastle’s population is now growing.
That’s a turnaround in our economy, it’s a turnaround in our city, and the message for Labour nationally is that if you want experience of economic credibility, if you want to demonstrate our ability to govern, look at what Labour local government is doing now. We don’t have the luxury of simply campaigning against austerity, we’re in the thick of it, having to deal with difficult situations, make difficult choices, but we’re doing that in a framework of Labour values in a way that we can demonstrate long-term benefit for our communities. It’s about being in power, it’s about demonstrating that Labour wants to be in office to make life better for people.
Alison McGovern: Would you say that your choices are a better proof of economic credibility than say, you know, a line or a speech or …
Well, with the greatest respect, you can’t create jobs by making a speech. You can create jobs by investing in ground clearance, in construction, in helping existing businesses to grow by making sure that they’ve got access to the people and the skills that they need in order to expand. It’s about creating the right conditions for growth, and Labour councils up and down the country have significant experience of this.
I want to come back to what you said about identity because Newcastle is somewhere that has an incredibly strong sense of identity. It’s a city that other places around the world are named after. You know, people went from this city to the new world and they felt so strong about their identity they named the new places after the old place. You know, it’s one of those towns. How do you think Labour can make the most of that? Because I worry that we’re still wrestling with post-Scottish referendum, we’re still wrestling with this. Like we’re a bit afraid about talking about identity.
I think devolution is one of the new faultlines in British politics. It cuts across political parties, and there’s a new dimension in politics that people are either centralisers or devolvers. Instinctively I’m a devolver, because I think the opportunity to shape a place in entirety is a huge opportunity for Labour to be able to demonstrate what we can do in government. Whether that would be London, whether that’s Newcastle, or Greater Manchester, Labour values in action are shaping our great cities.
Alison McGovern: Do you think that matters to people though? Because like, you know, to put the centralisers’ case, one second, let me play devil’s advocate. They would say, ‘Oh, your devolution is all very well, but it very quickly becomes a postcode lottery. You know, it very quickly becomes like, you know, what kind of services you’re entitled to, depend on where you live.’ That, you know, if we believe in equality, that can’t be right, can it?
But the one-size-fits-all, take-it-or-leave it approach to public services is broken, morally as well as financially. What we can do in terms of public sector reform at a local level is far more powerful, because we can connect it with our communities. The conversations you can have in a place about what’s right for that city are far more subtle and engaging than the conversations that you could have with a national government. It also helps create a sense of shared responsibility rather than everybody assuming that there are problems here, but it’s the state’s fault, responsibility to fix those problems.
Alison McGovern: Because if you turn up to a community in Newcastle, it’s like you’re one Newcastle person talking to some people in the community of the city, and you can own it together. Am I right?
Well, look at what we’re doing in the city in the face of really deep cuts and the government’s current austerity programme. We’ve worked very hard with communities to keep libraries open by looking at new models of delivery. We’re keeping customer service centres and community centres open, and we’re joining up local facilities at a local level, often helped out or staffed by volunteers. That brings the community together with a new sense of shared responsibility around looking after their neighbours, in a way that the state just couldn’t if it operated by itself.
Alison McGovern: You can’t do that from Whitehall.
No, you can’t. Because you just don’t have the local knowledge or the connections.
Alison McGovern: Yeah, it’s about that fine-grain knowledge of what things are like in a particular area where they might have their own priority between a particular type of service. You talked about faultline between the centralisers and the devolvers – who’s going to win?
Well, of course, everybody recognises that a centralised state just doesn’t work any more, if it ever did. The question is: how do we restructure the state in a way that makes sense at a local community level, and gets best use of existing resources? The current government has a devolution agenda which is skin-deep. It’s a step in the right direction, but it’s nowhere near as radical or as bold as Labour should be demanding. We should be demanding place-based public sector reform deals. We should be demanding much greater control over local taxation. We should be demanding much greater ability to coordinate public services in our respective areas.
These are the things that make a real difference on the ground, and there’s a telling statistic from Greater Manchester that despite all of the six years of austerity that we’ve had, public expenditure in Manchester has actually remained more or less the same. It’s been cut in some areas, like the council, but it’s gone up in other areas, like welfare spend and the NHS. The current approach to reducing the deficit simply isn’t working. What we need is much greater local control over funding streams and finances, taxation and services, brought together under local democratic control to deliver for our communities. We’re prepared to take the risk. Why shouldn’t we therefore be able to get on and just deliver?
Alison McGovern: Quite right. OK, final question. Our colleague, Claire Kober, leader of Haringey, has issued a bit of a challenge to the Labour party nationally. Because, you know, we have lots of people going on telly to speak for the Labour party every week, and rarely is that a local government leader, and as you’ve just said, you know, local leadership is about grown-up governors. You know, this is not for the fainthearted. Given that leaders in local government should be speaking for Labour, at the end of the day, right now they’re the ones who are in power. You know, Welsh assembly government and local government, that’s who are in power. Yes or no, Nick Forbes. It’s Tuesday afternoon, your phone goes, it’s the Labour party press office in HQ. They say to you, ‘Nick we need you to go on Question Time on Thursday night. Yes or no?’
Nick Forbes: Yes, definitely. I’m there.
Alison McGovern: Absolutely. Say a bit about it if you want.
My experience of being on panels at party conference is that usually I’m third or fourth on the billing after two MPs, usually one of which I’ve never heard of. There’s something about our party which gives MPs status but council leaders not, and surely if we’re to play to our strengths, we should listen to some of the best voices that we have in the party at the moment, which are amazing and talented local government leaders.
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