After a dull campaign, low turnout and another huge majority, what does Labour’s re-election mean for business involvement in social issues? And how should companies respond? Mike Tuffrey examines the prospects.
Aside from ‘that punch’, one of the few contentious moments came when Tony Blair coupled his pledges on renewal in public services with a demand that the private sector be more involved. This remains very controversial when applied to mainstream traditional services like health, education and transport – witness the politics over privatising London Underground. However it seems certain business will increasingly be involved in outsourced services and the pressure will be on about direct provision – with basic bank accounts for the ‘unbanked’ and support for the post office based ‘universal bank’ being examples from the last Parliament.
The new government’s continuing serious commitment is not in doubt, following the appointment of Douglas Alexander as minister for corporate social responsibility – a rising star and close to Gordon Brown, who adds CSR to e-commerce and competitiveness. Business in the Community’s post-election call for a full time post reporting directly to the prime minister fell on deaf ears.
Two other highlights stand out from the generally safe ‘more of the same’ Labour manifesto (see box). First is the pledge in effect to legislate for the Company Law Review – broadening the duties of directors beyond short-term shareholder value and promoting transparency such as mandatory environmental reporting.
The second is around deprived areas and tax incentives to invest. Although not mentioned explicitly, this seems to be a pledge to take forward the recommendations of the Social Investment Taskforce, effectively to mirror practice in the US with a new sector of community-based funding bodies with tax credits and a need to engage companies very fully in their work.
The imponderable is the regional agenda, always a split between the decentralisers around Prescott and the centralisers around Blair. Brown seems to have embraced decentralisation, and the manifesto pledged more powers for the regions and RDAs, moving in time to an elected tier as in London. But the regional agenda is now spread across three central departments – Prescott in the new ‘beefed-up’ Cabinet Office, RDAs now at the DTI and regeneration at the remodelled DELTR.
Which leads on to the big issue for the second term: implementation, implementation, implementation – that is how to ensure broad policy ideas are understood, supported and then successfully actioned on the ground. The last few years have seen mounting frustration from the many business people who have served on partnership bodies and boards.
One of the most experienced, David Grayson, is calling for a concerted push on the new Cabinet Office and No 10 structures for a fast consultation exercise with business, endorsed by the Prime Minister personally. This would send a very powerful signal of good faith and being serious. He says what’s needed is:
• to distil what has been learnt from public-private-community partnerships over the last few years to ensure they are understood and the implications applied;
• to achieve absolute clarity from ministers / Parliament about the brief for any new bodies or initiatives;
• a willingness by government to step back and be ‘steerers rather than rowers’ as Osborne and Gaebler said in their 1991 book Reinventing Government;
• to apply sufficient resources to do the job assigned – either public, or by permitting entrepreneurialism to raise alternative funds – or if those resources are not available, to be ready to modify the objectives;
• genuinely to sign-up for a stakeholder model – and for stakeholder-engagement (not just stakeholder-management) – engaging schools, community development trusts, business partners et al with the government agencies, at all stages.
One issue will need to be thought about much more creatively, namely training people on the ground in how real partnerships function and what structures are needed. This must extend both to the deliverers and to the civil service officials acting as the contract managers. Despite all the emphasis on partnership, little is done to equip those involved or to study successful models and ways of working.
Another key issue is the role of the European Union, where the Commission is consulting about a Green Paper on corporate social responsibility, expected to be published shortly. Help or hindrance? And what line will the new ministers take on WTO negotiations and the whole anti-globalisation debate (the manifesto offers few clues)?
But the bottom line is that more ‘fancy extra initiatives’ will not do the trick. It needs much greater co-ordination and ‘joined up government’ especially at local level – at the last count no fewer than 48 different schemes – one reason why so many initiatives in the first term failed to attract matched funding/serious involvement from business on the levels anticipated.
Otherwise there is a danger of a backlash, such as that already seen in opposition from Chambers of Commerce to the advent of BIDs or from senior executives wary of getting involved.
Ultimately the strongest business case for getting companies engaged in social exclusion is directly through their mainstream operations. If the US-inspired model of social investment financing is THE big idea, it will work only when companies see the business benefits of working alongside the new community development agencies, finding the synergies. n
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