Stephen Byers – 2001 Speech to the Social Market Foundation


Below is the text of the speech made by the then Secretary of State for Transport, Local Government and the Regions, Stephen Byers, to the Social Market Foundation on 2nd August 2001.

Why housing matters

When you ask people about what is important to them, their answer is nearly always the same:

– good schools

– good hospitals

– low crime

– good transport.

What follows next is a secure job and a decent home.

Our home is more than just a shelter.

For most people it is associated with family, comfort and warmth.

It is where our roots are.

Our local community is defined by where we live.

There are few more desolate words than “homeless”.

Good housing is critical to our well being. If homes are cold and damp, the health of the occupants suffer. If houses are overcrowded, there is no room for children to do their homework.

Good housing cannot guarantee good health or high educational attainment, but it does make a big difference. Decent housing provides an important rung on the ladder of opportunity.

Changing trends:

As our society has undergone major changes over the years, so has the nature of housing-

Before the Second World War:

– nearly 60 per cent of houses were privately rented,

– about 10 per cent were provided by the local authority.

– and only 30 per cent were owner-occupied.


– about 12 per cent of houses are privately rented

– about 20 per cent are social homes, owned by a local authority or Housing Association;

– and about 68 per cent are owner-occupied.

Over the years, we have as a nation made huge strides in the quality of our housing. The vast clearance schemes in the late sixties and seventies may now have a bad name because of the impact they had on communities. But they, and rising prosperity, made their contribution to the quality of the stock.

As recently as 1967, 20 per cent of our dwellings lacked an inside toilet. Now less than 1 per cent are in that position. We have as a nation achieved a great deal, but there is still a lot to do.

What I want to do today is to touch on some of the problems we have, and share with you a number of the more interesting ideas that we are developing.

The problems:

In London and the South-East we face growing housing pressure. The very success of London’s economy has made it a magnet for the ambitious and aspiring, not just from the UK but from Europe and around the world.

But the pace of development is failing to meet demand. Provision of social stock has fallen dramatically over the past 20 years. As a result, house prices are rising and homelessness is growing.

In contrast, in other parts of the country, we are witnessing a declining demand for homes and even abandonment in certain areas. This is not restricted to the social sector- but owner-occupiers who can afford to leave are deserting certain parts of inner cities.

Even where demand is still in balance, we find some of the poorest members of our community living in poor quality housing. Often they own their house but cannot afford either to improve it or to move. Some of these are black and minority ethnic communities as we have seen in Oldham, Bradford or Burnley who value their local community and may not want to move out.

And some poor quality stock remains. Over two million children live in homes which do not meet my department’s definition of ‘decent’. These are not confined to those in social housing- in fact the majority live in the private sector.

Housing problems are a complex mix of problems that vary from town to town, neighbourhood, to neighbourhood. Some can be dealt with through housing policies alone: others require a range of different programmes, to be brought together to deal with these issues in a coherent and comprehensive way.

Governments strategy for housing:

This Government’s ambition is that everyone should have the opportunity of a decent home. And to have that opportunity

– regardless of their social class

– regardless of where they live

– and regardless of their race.

Labour’s past role in providing decent homes for millions of people through the massive programme of building Council homes after the war is one I am proud of. ‘Homes fit for Heroes’ was a promise made and a promise delivered.

Society has moved on. We are more prosperous as a nation and as individuals. For many people today the aspiration is to buy their own home. It is an aspiration I support and this Government supports.

Home ownership, however, will never be the solution for everyone. It is for that reason that that we are determined to bring quality and choice across the whole range of housing.

Equity shares

One of the more innovative ways to make this objective a reality was featured in our election manifesto. We promised to consider ways in which social tenants might gain equity shares in their homes.

We are still at an early stage in developing our thoughts, but I would like to explain the thinking behind the idea.

If we are serious about social cohesion, we need to extend the benefits of the property owning democracy to the four million social tenants. We can do so by giving social tenants a direct financial stake in their homes, which will both provide them with financial assets to enable them to play a full part in society, and encourage them to take a greater interest in their homes and communities.

It may be the case that equity shares provide the mechanism for achieving this objective.

Helping a tenant gain a direct stake in their home has the potential to radically change the outlook of the occupiers of social housing.

They would cease to be tenants with little control over their housing, and instead become part owners with a direct interest in working with their landlord to maintain their homes and their communities.

Equity shares also has the potential to provide tenants with the assets they need to open up new opportunities. On average, people in the UK hold around £750 of liquid financial wealth, with home owners having an average of an additional £50,000 tied up in their homes.

By definition, no social tenant owns any share of their house, and nearly 60 per cent of them have no liquid financial savings either. Helping tenants to acquire equity shares could help them obtain access to the financial services that most of society takes for granted.

And in some cases, the equity share may provide the additional asset that permits tenants to take the final step into full owner-occupation.

These are our preliminary thoughts on the issue of equity shares. No decisions have yet been taken, and of course we will need to consider their cost effectiveness and affordability.

But we are clear that this is an issue which merits detailed consideration.

Quality in social housing

Equity shares is an exciting idea- and one that we intend to work on over the coming months. But we must also look at more immediate concerns.

When we came to power in 1997, we inherited a huge backlog of repairs and maintenance work in Council housing. The bill runs to some £19 billion. Some 800,000 children are living in social housing that not regarded as decent.

There is a simple reason for this.

Local authorities have been starved of funds. There has been a massive decline in housing investment – resources provided to local authorities halved between 1992 to 93 and 1997 to 98. We have more than reversed this decline.

If we had continued with the spending plans we inherited, local authorities would be receiving around £700 million annually for capital expenditure on housing. Following the last two spending reviews and capital receipts initiative, local authorities funding will instead rise to over £2.5 billion in 2003 to 2004.

With this extra funding, I am committed to ensuring that by 2010 all social housing meets set standards of decency. Over the next three years, more than 300,000 children will be able to live in homes which are decent, with most of the improvement taking place in the most deprived areas.

By giving them the sort of basic facilities that most of us take for granted, they will stand a better chance in life.

The significant resources and the range of options for the funding and management of stock that we are making available, will help deliver decent homes.

We must focus on bringing about the improvements for tenants and not be too traditional about the means.

Options such as

– stock transfer,

– the Private Finance Initiative for housing,

– and Arms Length Companies,

– offer local authorities a genuine range of options for improving the quality of their stock. Authorities must consider which is the best option for them, and their tenants.

But achieving the target requires more than money. It requires focus and commitment by all agencies. It requires a partnership between us in Government and social housing providers.

Local authorities need to take a business-like approach to managing their assets. Some already do, but all local authorities should assess the state of their own housing and construct plans to improve conditions.

But the task of raising standards is not just for local authorities. Housing associations too must rise to the challenge, and we need a similar commitment from them.

Because for some people we cannot act quickly enough.

Ensuring that all social housing is decent is a top priority. And whilst I look forward to celebrating the success of housing providers who raise standards, I am more than ready to turn the spotlight on any who do not.

“The Way Forward for Housing” provided the policies for social housing.

The Spending Review subsequently provided the money to enable us, with substantial help from others, to achieve our target of making all social housing decent. But looking to the future, many of the problems will lie not with the social housing, but with the private stock.

Poor conditions in the private sector

It is only right that the responsibility for maintaining a home should rest first and foremost with the owner. We expect owners to keep their homes in good order.

But there are circumstances, where public intervention may be needed. For example, where people’s health is at risk from homes they cannot afford to repair. Or where a concentration of worn out or abandoned housing threatens to destabilise an entire neighbourhood.

In these cases support from the Government can make sense. Timely investment can prevent problems from spreading, and can help reduce pressure on other services such as the NHS. It can help ensure that people have the same opportunity of a decent home, regardless of whether they live in public housing or own their own home.

We have been supporting local authority expenditure for these ends for a number of years. It is my intention that we should help the renovation of 200 thousand poor condition private sector properties between 2001 and 2004. And we have been looking at ways to ensure the money spent by local authorities goes further.

In most parts of the country, a successful economy means the demand for private housing is strong.

But in some areas, for a variety of reasons, the opposite may be the case. People leave for more modern homes. They are quitting run down areas where crime is high and the quality of life low. By leaving, they add to the problem.

Low demand for housing is eating away at the fabric of many towns in some parts of the country. There can be little more depressing a sight than row upon row of boarded up housing. We are committed to tackling this problem, and are giving authorities a range of tools for doing so.

The different market conditions across the country means there is no single approach that will work in all cases, or in all areas. What works well in London or the South East may not be best for towns such as Salford, Bradford and Burnley. Similarly, housing is only part of the problem and can only be part of the solution.

That is why we are looking to local authorities, working with their partners, to take a strategic view of their problems and the solutions.

It is why we are giving local authorities much more freedom over how they tackle poor quality private housing. We have already made it easier for authorities to declare renewal areas and carry out group repair. In March this year, we published proposals to reform the legislation governing grants and loans for private housing renewal.

We will be introducing measures to bring this into effect in the near future.

The reforms will allow authorities to develop strategies that meet local needs, and to offer people a real choice.

Elsewhere, and often relatively close by, problems of housing shortage abound.


We must not forget those who do not even have a home to call their own.

Losing a home, and the security that goes with it, is one of the most harrowing experiences that anyone can face. Add to that the fact that homelessness is often related to problems such as frail old age, a marriage breakdown, drug or alcohol misuse, and mental health issues, and someone’s anguish is simply compounded.

The principal aim of any decent society should be to give practical support to those in need, when they need it.

Some of those in need of our help are the individuals who sleep rough on our nation’s streets.

Rough sleeping is an area where the Government – thanks to the excellent work of the Rough Sleepers Unit, local authorities, charities and other organisations – is on its way to delivering its pledge. To reduce rough sleeping by at least two thirds by 2002.

We will be announcing the latest Rough Sleepers Unit census over the next few days.

But as well as helping individuals have an alternative to a doorway, we must prevent people ending up on the streets in the first place.

Which is why it is so important for us to press ahead with the Homelessness Bill.

The first Bill to be introduced after the election, it offers hope and protection to some of the most vulnerable groups in society.

By promoting a more strategic approach by local authorities to preventing and managing homelessness and encouraging them to offer more choice to those applying for social housing, our proposals will strengthen the homelessness safety net.

In London alone there are 42,000 households in temporary accommodation . More than 7,500 of these are in bed and breakfast. This is not suitable as a long-term solution for our families in this day and age.

That is why we are setting up the Bed and Breakfast Unit to work with authorities to see what more can be done and to identify any barriers to reducing its use. We need to ensure that we are looking to the longer term and putting preventative measures in place.

Affordable housing

Although the Bill will reinforce the homelessness safety net in crucial ways, it is no substitute for increasing the supply of affordable housing. I have spoken earlier about abandonment: this is the other end of the spectrum.

It is one of the most pressing issues we face. The past four years of sustainable growth has meant that more people have become home owners. Whilst this is a good thing, it has also contributed to market pressures. This came on top of the massive funding cuts in housing programmes during the mid-1990s.

My first priority is to change this tide. By 2004 the Housing Corporation’s budget for developing new affordable housing will be over £1.2 billion, almost double what it was last year.

Over the next three years, we will provide 100,000 new or improved homes for low-cost rent or ownership. That includes affordable housing funded by local authorities and some homes secured through planning gain.

I intend to ensure that the planning powers I have are used effectively to lever in more affordable housing. These planning agreements could provide a much needed solution in housing hotspots like London and the South East.

And there are other fronts where we will be keeping the pressure up. There are too many empty homes that are just wasted assets. The VAT changes recently announced will help here; and we will continue to support the efforts of the empty homes agency to bring redundant property back into fruitful use.

Private rented sector

Of course, we must not forget the role of the private rented sector in helping to meet housing needs.

Although this sector has seen a modest revival over the last decade, it only accommodates about 12 per cent of our households. So, does it really matter?

I believe it does. People are not buying their homes as early as they used to. The young don’t always want to commit themselves long-term to a particular home in a particular place. And homeowners may need a long-distance move. Renting a home in the new location gives them the chance to look around before they buy. Or they may want to rent out their old home while they are away.

So a healthy private rented sector can help enormously to oil the wheels of the housing market – and the labour market too.

And private renting is often the only realistic option for those who cannot yet buy, but do not qualify for priority access to social housing.

So private rented housing caters for a great variety of needs, and we want to see more of it.

But too much of what we have got is of a poor standard, badly maintained and badly managed. And it is these tenants with the least power in the market – the poor, the sick, black and ethnic minority people – who get the worst deal.

So, what do we need to do? In a nutshell, we have to:

– Persuade investors that private renting is a worthwhile business to be in

– Help well-intentioned landlords – and I believe most of them are – to raise their standards

– Ensure that all landlords provide decent accommodation.

Whilst there will always be a place for the small landlord, we need to see the financial institutions putting money into new developments for private renting. They do this on a large scale in the US and the Netherlands, for example, and, once upon a time, they used to do here.

Although they are rightly cautious about what they do with your and my money, they have nothing to fear. This Government is not about to reintroduce across-the-board rent controls or give private tenants lifelong security.

And whilst we will continue the dialogue with investors about tax issues, we are not interested in crude tax breaks like the old Business Expansion Scheme. We want long-term commitment from investors who recognise that building for rent can be an intrinsically sound business proposition and reasonably low risk.

In recent years, improvements in the economy have also contributed to decline in the proportion of private tenants on housing benefit from around a third a few years ago to around a quarter today. But this still means that over £4 thousand five hundred million a year is paid direct to landlords through housing benefit.

The payment of housing benefit to landlords is an important lever that we have to drive up standards in the privately rented sector.

Is it really right to pay out taxpayers money in the form of housing benefit to landlords who fail to provide decent accommodation?

I believe that it might be appropriate to attach conditions to the payment of housing benefit. One such condition could be a requirement to improve the state of the property so that it meets our definition of decency.

In addition, landlords receiving housing benefit have a clear responsibility to make sure their tenants behave in a civilised manner. No more neighbours from hell disrupting the local community- while their landlords do nothing apart from pocket housing benefit, courtesy of the tax payer.

We shall therefore look closely at developing measures in relation to housing benefit, linked to a selective licensing scheme for private landlords. We intend to say more about this in the autumn.


So it is clear we have a sound framework for housing in place. Our aims are clear; we have the money; and I have set out some of our ideas for taking the new agenda forward.

There are of course many areas in the field of housing that I’ve not been able to touch on in the time available.

What I do know is that housing is one of those areas in which fresh thinking and original ideas would be welcome. I look forward to the debate.

Stephen Byers – 2001 Speech to Institute for Public Policy Research


Below is the text of the speech made by the then Secretary of State for the Department of Transport, Local Government and the Regions, Stephen Byers. The speech was made at the Institute for Public Policy Research (IPPR) on 26th July 2001.


Planning is fundamental to the way our cities, towns and villages look, the way they work and the way they interconnect.

Getting planning right means that our goals for society are easier to achieve. Good planning can have a huge beneficial effect on the way we live our lives.

I want to use today’s event to launch a debate about the planning system – a debate that will lead later in the year to a Green Paper on reform of the planning system.

But this will not just be about the mechanics of the system. Our present planning system is now over 50 years old. It needs a radical overhaul.

The Green Paper will need to look at what we expect of our planning system.

As we consider the fundamental purpose of planning, we need to ask questions about what planning has done well in the past, what it has done less well and to see what lessons we can learn for the future.

For example:

– what is the role of planning in promoting economic growth and improving regional prosperity

– how can we satisfy both economic and environmental goals

– and especially how can we engage communities and make people feel connected with the process of government.

We need to learn lessons from the past about engagement with people. About getting in touch with what communities really want.

For many people globalisation leads to a feeling of uncertainty and a lack of influence over the course of events. An effective and sensitive planning process can ensure that individuals and communities can engage in the process on equal terms and be able to voice their concerns.

At present too many planning public inquiries are complex and technical. With debate dominated by highly paid lawyers – this is intimidating for many individuals.

They are a banquet for barristers- but starve local people of the opportunity of expressing their views. This often leads to a feeling of anger, frustration and disengagement from the whole process.

Our aim must be a planning system which is efficient and open. And which has the renewal and protection of communities as one of its key objectives.

Planning of land use is one of the key levers we have to help create a decent society. Planning is fundamental to the way cities, towns and villages look, work and relate to each other.

Quality of life

Perhaps nowhere do people connect more than with their local communities.

That becomes clear when one asks what is important to people. What are their priorities? What do they value most?

The answer is nearly always the same:

– good schools

– good hospitals

– low crime

– good transport.

And of course, homes and jobs.

Delve a bit further and people start talking about:

– the quality of their local environment

– what they think of a new development in their local area or the design of a local building

– whether their local community is becoming a better or worse place to live.

Of course, people don’t always say consistent things.

They may want unlimited use of their cars- and at the same time less traffic and cleaner air. They may want a full range of services- but want to retain the characteristics of a village.

They almost certainly will want a choice of housing for themselves and their families at a price they can afford – but no new housing development in their area.

The challenge for us, as a Government, is to deliver a package of measures, in an integrated way on the ground, that deliver better outcomes for people. Better places to live and a better quality of life.

This is at the heart of our agenda for regenerating local communities.

Planning objectives

Planning plays a major part in all of this because it shapes communities. The planning system – if it works properly – is a critical tool for translating a vision of liveable and sustainable communities into practical reality on the ground.

It can improve, in a very tangible way, the places where people live.

People care very much about where they live and about the changing quality of life in their neighbourhood, town or village.

It can be very powerful tool, too.

For instance, a short while ago we strengthened the rules on out-of-town shopping.

While it always takes time to work through all the old planning consents in the pipeline, we are winning the battle. For the first time in 20 years, new shopping space in major town centres exceeded new floorspace in out-of-town shopping centres and retail parks.

Although this does not mean that there are not still retailers seeking out-of-town supermarkets, the trend is changing.

There is a similar story with major cinema developments. Five years ago, up to three quarters were being built out of town. Last year, two thirds were within existing centres.

Planning has made mistakes in the past. Think, for example, of the experiment in high rise living. We can’t lay the blame for that entirely at the door of planners because, at the time, the priority was better housing.

But they didn’t think about the communities they were destroying.

Nor did they see the damage that inner ring roads did to many of our towns. The cars may have moved faster but the new roads cut communities in half.

Grey concrete re-developments knocked the heart out of some town centres. Now we understand that bleak architecture feeds vandalism and other forms of anti-social behaviour.

We need stronger town centres not only because it helps preserve the character of places. But because they have important consequences for quality of life, travel patterns and social inclusion.

We need to create a stronger framework for investment in town centres and make them more exciting places to visit.

We have green belts that have preserved our countryside from urban sprawl, that is now a huge problem internationally.

And recently, we strengthened our policies on preserving greenfields from unnecessary housing development.

I support that policy. And I am happy to restate our commitment to achieving a 60% target for recycling brownfield land.

The economic balance

But I think we have to ask about the other side of the balance sheet. I have mentioned the pluses. What about the minuses?

First, we need to ask whether planning is delivering the goods as far as economic development is concerned.

Is the balance right between the free market economy and the role of Government in regulating it for the wider public good?

This is at the heart of many of the conflicts in the planning system – be it a retailer who wants to build an out-of-town superstore, or a developer wanting a business estate in the green belt.

It is clear, and as I am well aware from my time at the DTI, that the planning system plays a big part in determining business opportunities.

I also believe that there is a link, at least in some sectors, between productivity and the planning regime.

That doesn’t mean is that we just throw off our planning system in some vain attempt to ape the USA with its seeming acres of spare land.

What it means is that we recognise the need for economic investment and for a modern transport infrastructure and plan for it positively, in a way which reduces the conflict with the environment.

For example. Protecting the countryside from development delivers a positive economic asset for our tourism industry and our soils for agriculture- rather than something that is simply ‘nice to do’.

Maintaining the character of our historic towns and cities means that they become attractive destinations for internationally mobile leading edge companies – and that gives Britain a huge competitive advantage.

I think we have to do much more to articulate the positives of planning and its role in implementing policy. We have to get away from the regulatory culture and recognise that planning can be a very powerful way of reconciling both environmental and economic benefits.

Major infrastructure projects

As many of you will know, I announced last week a response to a consultation exercise on better planning for major infrastructural investment.

You will all be aware of the delays that have bedevilled some major projects.

There can be no question of allowing commercial interests to run roughshod over legitimate environmental concerns.

And, as I have already emphasised, I have no doubts about the right of the community to express their views about decisions which affect them.

But what is not right is that important economic decisions should be delayed simply because of inefficiencies in the planning system.

It does no service to the environment nor to the business community if difficult and important decisions are put on hold in the hope that they will go away. They won’t.

That is why I set out an agenda for clearer national policy statements about our investment strategies, backed by new Parliamentary procedures and better inquiry procedures to allow people to have their voices heard.


Another set of questions which the Green Paper will need to consider is whether we are asking planning to deliver too much. Are we overloading it at the national level?

As many of you will know, the drafting of planning policy guidance notes could be better focused.

There will always need for national guidelines. But my suspicion is that we may have gone too far with the detail. I know that every time an attempt is made to take out some of it out of our PPGs, there is a clamour to put it back in.

But does it make sense to prescribe everything at the national level? Is there a case for asking the region to play a bigger part? For getting planning down to the level at which the consequences will be most felt?

There is also a wider issue here about whether the whole system is too complicated and overburdened.

Planning process and plans

For example, we have a multi-layered system of plans in England.

We have three tiers in many areas with the regions at the top, county plans and local development plans.

What chance then that the plans fit together as a coherent whole?

The questions I ask are

– do we still need this degree of complexity?

– is the multi-tier structure producing any added value?

– or is it simply siphoning off resources which could be used better elsewhere?

Not only that, but we have to look at the way in which we make local plans. Ten years after the local plan system was set up in 1991, 16 per cent of the 362 local planning authorities have still to put a plan in place. 214 of current plans will expire over the new two years and almost two thirds of these authorities have not put forward any proposals for updating their plan.

Is it any longer practical to contemplate a complete and rapid revision of local plans? I am told that a major city or district council updating its plan can now expect to engage in a process stretching into years which ties up experienced planning staff and costs upwards of £500,000 in public inquiries.

If the system is broke – and quite a few people seem to think it is – then we have got to fix it.

Any new approach to local planning must, in my view, be able to:

Provide an overall vision of where the physical development of a community is going.

Articulate a process of change on the ground in particular areas.

Be deliverable and flexible.

Engage with the community. Those people whose quality of life will be affected by the plan.

And I would also add any development plan cannot be independent of other plans and strategies prepared by local authorities.

For example we now have local community strategies – which will integrate other plans prepared at local level and will set out a vision for the well-being of local communities.

In my speech to the Local Government Association earlier this month, I said that we must do something about the multiplicity of strategies and plans.

Leaving aside the inefficiencies and resource costs involved, we have got to produce integrated policies to deliver solutions for people on the ground. All our efforts are wasted unless they produce a better quality of living for the people whose communities are involved.

Local planning decisions

Finally I want to say a few words about the quality of the planning system.

Local planning departments have over half a million direct customers a year applying for planning permissions. But the performance of individual authorities is highly variable.

It simply cannot be right for similar planning applications to take days to decide in one authority and weeks in another.

Nor can it be right for time-critical business decisions to be given the same priority as an application for a garage extension.

Business tells me that what they need most of the planning system is speed, certainty, transparency and quality of decisions.

None of these requirements seem remotely unreasonable. They are what we all want of planning. And they are no more than we would expect of any other public service.

As we prepare our Green Paper, I want to pose questions about the internal procedures being used by many local authorities.

Some use officer delegations to good effect. Others don’t.

Many provide a single case manager for larger applications who provides customer feedback. Others don’t.

Some local authorities try to provide a one-stop shop to help customers through the red tape of statutory and non-statutory consultees and other regulatory regimes. Others create an obstacle course for their clients.

A huge amount can be done to improve practice.

But it requires a cultural shift at the local level to recognise the importance of the planning system and to turn it round to face the customer.

The Government can, and will, legislate to overhaul the planning system subject, of course, to Parliamentary time being available. But it is much more difficult to change attitudes and to ensure that all authorities perform to the standard of the best.

I want to know whether local government is itself prepared to raise the priority given to planning so that it is better financed.

I also want to know what the planning profession is going to do to raise the sights of planners and make sure that they have the skills and customer focus required of their role. There is a major issue here for the professions.

A more radical option that I am considering for the Green Paper is whether to introduce a planning audit function to help local authorities deliver better performance. Views would be welcome.


The Green Paper issued in the Autumn will set out a reform agenda. But I am not seeking change for change’s sake. I am seeking a new approach that frees up the planning service to do what it should be doing -shaping our communities for the better.

This event marks the beginning of that consultation process. Charles Falconer, Sally Keeble and I intend to listen as much as possible to the views of the widest range of people over coming months. So that when we come to set out our proposals, we will have a clear understanding of the problems and, hopefully, the solutions.

I hope my words today underline my firm commitment to a more positive planning service that has a stronger sense of vision and a stronger will to deliver.

I want an efficient, open and transparent planning service that can deliver a sustainable future for our countryside, our towns and our cities. That protects and renews communities.

It is a bold and ambitious vision but one I can believe we can achieve.

Stephen Byers – 2001 Speech to CBI Conference


Below is the text of the speech made by Stephen Byers to the 2001 CBI Conference on 6th November 2001.

Last year, the CBI hailed the publication of our 10 year Transport Plan as “a monumental victory”. You were right.

Everybody, everyday, needs an efficient, functioning, transport system.

Such a system is crucial for business too.

A modern and effective transport system is vital to the prosperity of this country, to the profitability of UK businesses, to our international competitiveness.

That’s why the 10-year Plan was such a breakthrough. I am grateful for the CBI’s support during its preparation, and since.

In the Plan we set out clearly, for the first time, a long term programme of investment. Over a period that actually relates to the time it takes to plan and execute transport investments. And we committed an unprecedented level of resources – £180 billion. £59 billion is for local transport, including major road schemes. £21 billion is for the strategic road network. £64 billion is for rail. £25 billion is for London. £121 billion of this is for capital investment – a real increase of almost 75% compared with the previous 10 years.

We have set out clearly and publicly, for the first time, targets for the end of the decade:

– to reduce congestion on our trunk road network and in our major cities

– to end the backlog of maintenance on local roads, and

– to improve public transport.

But now we want to move from debate to action. The 10 year plan began in April. Now, we must get things done. Now, we must focus on delivery. We have waited too long. Tough and difficult decisions will need to be taken if, over the next few years, we are to begin to see real improvements.

Railways are a key part of the 10 year plan.

A year ago, the rail industry was just recovering from the aftermath of the terrible events at Ladbroke Grove when the accident at Hatfield threw the industry, and particularly Railtrack, into further turmoil.

Partly as a result of Hatfield, Railtrack came to the Government for more money. In April of this year we agreed a deal with them based on their business plan at the time.

We agreed to bring forward £1.5 billion of investment. The first instalment of which was paid on 1 October – £337 million paid in full.

But at the time of the April agreement the Government believed that it should make it clear that our role was to support the railway network but not individual companies or shareholders.

We therefore issued through the Stock Exchange news service the following statement, “the Government stands behind the rail system but not individual rail companies and their shareholders who need to be fully aware of the projected liabilities of the companies in which they invest, and the performance risks they face.”

The Government does believe that shareholders should get the value in Railtrack to which they are entitled.

But we do not believe – especially in the light of our statement of 2 April – that we should now be putting in more taxpayers money in order to compensate shareholders of Railtrack.

Railtrack went into administration because it was insolvent. My petition to the High Court was unopposed.

Our evidence showed a deficit for Railtrack of £700 million by 8 December rising to £1.7 billion by March of next year. Little wonder that faced with the facts Mr Justice Lightman said, “this is clearly a case where the making of an order is not only appropriate but absolutely essential, I shall therefore make the order immediately.”

My decision on 5 October to refuse further funding to Railtrack was not an easy one. But I firmly believe that Railtrack was not part of the solution for our railways but was a major problem. Just look at Railtrack’s stewardship.

There is still no asset condition register in place for the rail network;

Railtrack consistently opted not to invest in maintaining the network to a high enough standard;

There were still over 1,000 Temporary Speed Restrictions in place 6 months after Hatfield.

Costs on the crucial West Coast Main Line project leapt from around £2.1bn to (at least) £6.3bn under Railtrack’s stewardship. That’s an increase of over four billion pounds.

We had to say: Enough is enough, let’s get to the root cause of this. Let’s look at the structure and put it right so that for the extra money we intend to put into the railways secures real value for money and an improved service.

There are some excellent people working at Railtrack and throughout the railway industry.

But Railtrack was not delivering and these excellent people deserve to work in a structure that does.

You all know that we are proposing a Company Limited by Guarantee (or CLG) to take over Railtrack’s stewardship of the network. It would include membership representing the industry and those with an interest in it. That is only right. But they would not be running the railway or taking any day-to-day decisions.

The railway would be run by a professional board. Those people would be charged with one aim and one aim only – to deliver. To deliver a safe and efficient railway fit for the 21st Century. Because that is what I, you, and everyone, want.

But the Company Limited by Guarantee is only one possible model. We welcome the interest that has been shown by other third parties in Railtrack. The guidelines I published last week are aimed at assisting potential bidders in this process.

We will look at any serious proposal put to us very, very carefully. We will only proceed when we are happy that the successor to Railtrack can really deliver for industry and for the travelling public.

Our decision in relation to Railtrack must be seen as part of the wider debate about the role of the private sector in the provision of public services.

Personally I have been a strong advocate of the involvement of the private sector in the provision of public services. Private sector skills have the potential to make a real contribution towards our priority of improving the quality of services to the public.

So we should examine carefully, on a case by case basis, what the private sector can bring to public services in terms of its expertise in innovation, effective risk management and increased efficiency.

To be blunt the involvement of the private sector is a means to an end – helping Government to deliver better public services more effectively.

It therefore follows that when the private sector fails – as Railtrack clearly did then the Government has to act decisively in order to put the public interest first.

There is an important message here for the private sector. We you want to work with us to deliver improved public services. But there will be no tolerance of failure. And you wouldn’t expect it to be any other way.

We are charged with the responsibility of delivering in the public interest and that’s what we shall do.

Railtrack’s slide into financial crisis and administration may have been a shock.

But it is also a golden opportunity to turn a corner in the history of Britain’s railways and really start to improve services. The role of the SRA and its strategic plan will become even more important in this new context for the industry and the SRA needs to respond accordingly.

This is why the, genuinely widely welcomed, appointment of Richard Bowker as Chairman of the SRA is so important. He will bring renewed energy, allied with vision, to the industry and will produce a strategic plan before Christmas that will map out a new direction for our railways.

And we will do our part. We are going to need to look again at regulation. We need to see a clearer line of sight from the Government’s policy to the efficient running of the nation’s railways.

We intend therefore to streamline the regulatory system – while recognising that there will, as the industry expects, be a continued need for some form of independent economic regulation.

In addition, we shall take action to remove perverse incentives inhibiting the effective operation of the industry and we shall implement changes to improve the franchising process. But this is not change for changes sake. It will lead to better services. And it will help us to hit our ten year plan targets.

Some have said that the developments concerning Railtrack jeopardises the Government’s whole programme of encouraging private investment in public services.

As Tim Stone said in the Financial Times the other week, it is astonishing if leading investors cannot distinguish between old-style privatisation and the wholly distinct private finance/public private partnership deals. And, as chairman of the Financing Group at KPMG Corporate Finance, he should know.

Indeed, in a recent report the credit rating agency Standard and Poors said: ‘the Railtrack situation has no direct credit implications for rated PFI projects’

I was glad to read on Friday that the CBI shares this view.

We are confident that we will achieve the private sector investment in transport needed to deliver the 10 Year Plan.

Our Tube Modernisation Plan for London Underground. will bring private investment over the next five years. Investment needed to improve services and give London, and Londoners, the transport system they need and deserve.

Getting the railways and Tube right is crucial to the success of our Transport Plan. And we will get them right. But of course it goes wider than that. We are also delivering on the rest of our Plan for Transport.

Last December we allocated £8.4 billion to local authorities to spend on transport investment. Up to £1 billion for major road schemes. £3 billion for maintaining roads. And £4 billion for public transport and smaller schemes, including new light rail lines, better buses, traffic management measures and small scale road improvements.

Since the Plan was published we have given the green light to 39 new major local road schemes and 6 new light rail schemes.

All these are schemes that make a real difference at local level. Reduce congestion. Help to regenerate our town centres. Bypass local communities. Improve the local traffic networks that businesses use everyday. Opening up land for development.

And this coming December, we will be confirming the £1.5 billion allocation to local authorities for 2002/3, approving new major road and public transport schemes and providing top-up allocations to authorities where needed. This is all part of getting the Plan’s £180 billion spent on the ground.

And we are pushing ahead with the programme of improvements to the trunk road network. Since the Plan was published, 10 major national road schemes have been added to the programme. And we will soon be taking decisions on the reports from the next wave of multi-modal studies.

I do not share the view, expressed by some that we have too many studies and that they stand in the way of progress. We know from battles in recent years that we have to look thoroughly at all the options for solving transport problems if our decisions are to win acceptance and to be deliverable. We have to balance the economic and regeneration arguments with the environment arguments. Our decisions have to be environmentally principled.

But I assure you that we will not delay over taking these decisions. And once we have decided on a major road scheme, the Highways Agency will move fast to get it underway. Our commitment is to reduce the time it takes to deliver new road schemes by 30-50 per cent. This is how we will achieve our target for reducing congestion on the inter-urban road network.

Removing road blocks to delivery is very much part of our programme. We will soon be publishing a major review of the planning system to speed up planning processes.

I hope all I have said today shows you how we are moving on all fronts – on rail, London Underground, local public transport, roads, planning processes -. to deliver all the targets in the 10 Year Plan.

We will keep up the pressure.

When we published the Plan, we made clear that it had to be a live document. No Plan can last 10 years without review and updating. It must be monitored and revised in the light of developments. The 10 Year Plan is no different.

This is why we have asked the Commission for Integrated Transport, with the participation of the CBI, to monitor delivery and to advise us on what further steps might be needed to secure delivery of our targets.

This Government is committed to delivering a modern efficient transport system, fit for Britain in the 21st century. We will deliver you a modern efficient transport system, fit for business in the 21st century.

I intend to do it with you. There is a common agenda here shared by the CBI and the Government.

We shall work with you to deliver the long investment needed to rebuild the transport infrastructure; to cut congestion; to improve public transport; to give people greater choice; to get goods to market and people to work.

Our proposals will get Britain moving and give our people a transport system they can rely on.

The British people have waited generations for such a long term approach. In the interests of business, our people and our country the ten year plan for Transport will be delivered and we shall all benefit as a result.

Stephen Byers – 1999 Speech to TUC Conference


Below is the text of the speech made by Stephen Byers to the 1999 TUC Conference.

Hector, can I say that I am personally delighted, as Secretary of State for Trade and Industry to be addressing Congress this afternoon. I am acutely aware that I am the third Secretary of State in as many years to address Congress. It is what the Prime Minister means by labour market flexibility, I think. But I have given your General Secretary an assurance that as this may be my first and last address to Congress, I will be on my best behaviour. John has put me on a very strict vegetarian diet so the bad news for all those journalists is I have got to decline your invitations to a fish supper this evening.

I know that Charles Kennedy has been attending Congress today. I understand that it is the first time he has ever had a non-speaking role in anything that he has done, but I am sure that he will have learnt a lot from conversations and discussions with delegates.

As Secretary of State for Trade and Industry, having held the position now for nine months or so, I have personally welcomed very much the advice, the recommendations and the views that have been put forward by the TUC. That does not mean that I have always been able to agree with the points that have been expressed. There will be times when I have to say “No”; there will be times when I can say “Yes”. But in democracy I believe that is a healthy relationship, not an overly close one that many felt existed under previous Labour Governments.

Now I appreciate that at times decisions that we take in Government will cause tension between us. There will be disagreement and occasionally a feeling of anger and frustration as far as you are concerned. When this happens we need to ensure that we maintain a dialogue between each other. Our actions in Government will always be to put the national interest first. That means that in all we do we will operate on the basis of fairness and not favours.

I hope that I do not put John Monks in a difficult position when I reveal there has been one occasion in my time as Secretary of State when he has written to me with unreserved support for a decision that I have taken and a policy that we have implemented. He did not write that letter though as General Secretary; he wrote it as a long-standing supporter of Manchester United and it was supporting my decision to reject BSkyB’s takeover of Manchester United. (Applause) But at least I have one letter from John Monks of unreserved support for my actions.

This Government was elected on a policy and an agenda of modernisation and reform, not to be rooted in the past or overwhelmed by the present, but a Government with a clear vision of the future direction of British society and the British economy. That vision and sense of direction is vital as we are witnessing a fundamental shift in our economy and our society. It is driven by globalisation, by knowledge, innovation and technology. It is changing the nature of work and the very workforce itself. The successful economies of the future will excel at generating ideas and exploiting them commercially.

The first industrial revolution, in which we led the world, was based on investment in plant and machinery. We are now living through a new revolution, a new industrial revolution which is knowledge based which means investing in learning, skills and training. In all this, education will be the key.

In response to this rapidly-changing world in which we live, we, as a Government, are doing things differently, and I appreciate that for some this is not easy. But week in and week out we are delivering policies and doing so in a way which will retain and consolidate the support of that historic coalition that gave us a landslide victory in the May 1997 general election.

Let us quickly look at some of our achievements over the last 2 2 years. We restored trade union rights at GCHQ and we have cut corporation tax. We have signed the Social Chapter and we have led the case for reform in Europe. We have begun to invest , 40 billion in our schools and hospitals and we have cut the rate of income tax. We have introduced a national minimum wage and cut the rate of tax for small business to its lowest ever level. Within the month we shall see the introduction of the Working Families Tax Credit and we have also introduced tough measures to tackle fraud in our benefits system. We have established the New Deal for the young and long-term unemployed. We have also introduced a research and development tax credit for business. We have achieved all of those.

What has been the response of the official Opposition? The Tories still oppose the national minimum wage. They have got a new Trade and Industry Shadow Minister, Alan Duncan. He has described the minimum wage as a cretinous idea. I had a quick look in the dictionary yesterday just to reaffirm in my own mind what a ‘cretin’ was. A cretin is a fool or a stupid person. I think that is a far more accurate description of Alan Duncan than the minimum wage which has directly benefited 2 million working people.

The Tories would scrap the New Deal. They say it has been a failure, but let us look at the facts and not rely on prejudice: 300,000 young people already helped; youth unemployment cut by a half. The Tories regard that as a failure! It should come, of course, as no surprise. When they were in Government they were prepared to see a whole generation of young people the innocent victims of their economic and social policies. This Government will discharge our responsibilities to the young people and the future of our country. The New Deal does that and gives them hope for the future.

The Tories say they do not support the introduction of the Working Families Tax Credit and would abolish it if they could. This, perhaps, is the latest sign that they have learnt nothing from their election defeat. Support for hard-working families is now a key dividing line between the two major parties in our country. The working families tax credit will make work pay and give parents a real incentive. It will leave 1 2 million families, on average, 24 a week better off.

At the end of July we finally saw the Fairness at Work legislation reach the statute book, on the very last day of that parliamentary session – a new settlement for the workplace, a settlement based on partnership and minimum standards, for the first time, part-timers with the same employment rights as full-time workers, part-time workers at long last no longer treated in law as second-class citizens, trade union recognition if that is what the workforce wants, unfair dismissal regulations applying after 12 months and not two years, an end to blacklisting for trade union activity. We are going to make it unlawful to discriminate against an individual because they choose to belong to a trade union.

Whistleblowers, those courageous employees who expose wrongdoing in the workplace, often in a very vulnerable position: they will be entitled to unlimited compensation if they are unfairly dismissed – a clear indication of the importance of someone in that situation as events in Clapham with the rail crash and at the Bristol Royal Infirmary have all too clearly revealed.

I am also very conscious of the crucial work carried out by health and safety representatives. They are often in a very vulnerable position in the workplace when they try and secure a safe working environment. We need to find a way in Government to signal the important role that they play, and I was particularly pleased that we were able to introduce a late amendment to the legislation which ensures that if a health and safety representative is unfairly dismissed, there will be unlimited compensation to be paid to that individual.

Of course, in the Fairness at Work legislation, the union Movement has not secured everything it wanted; neither has the business community. A balance had to be struck and this was ‘fairness not favours’ in action.

In this changing world more parents are in work. One of the great challenges facing parents is how to juggle the responsibility of bringing up a family with holding down a job. We need to introduce family friendly policies into the workplace and we are beginning the process of doing that. We have extended maternity leave by four weeks. Additional maternity leave will be available after 12 months of employment, not the two years as at present. We have introduced 13 weeks parental leave for both mothers and fathers. We have introduced a right to time off work to deal with a family emergency, a right that will start from day one of employment. So no longer will a working parent have to worry about losing their job if they are called away to care for a sick son or daughter or to look after an ailing parent.

I recognise that the long hours culture that exists in our country is not supportive of family life and I know that many of you have concerns about changes we have proposed to the working time regulations. What is clear to me, both in relation to the working time regulations and our proposals for family friendly policies, is that we need to win over hearts and minds.

The adoption of these policies represents a major change in labour market policy, a change that can benefit both employers and employees, but they will only be of benefit if they are introduced in a sensitive and sympathetic way. I believe that these fundamental changes can be introduced in a way which secures our objectives without placing an undue bureaucratic burden on business.

It is not our intention to exclude white-collar workers from the protection offered by the Working Time Directive. I do not believe that our amendments to the regulations do that, but we need to make it crystal clear and I believe the best way of doing so will be to issue guidance on the regulations which will achieve that objective and which we will develop with the Health and Safety Executive. As is our usual practice, we will discuss the guidance with the TUC and with employers’ representatives.

As we implement detailed measures in the whole area of employment policy I want, wherever possible, to avoid the blunt instrument of regulation. Instead, we want to develop more flexible approaches to solving these common and shared problems. Alternative mechanisms, such as codes of conduct, need to be considered. Ensuring we achieve our goals will require more imagination and even greater constructive engagement from the unions particularly working in partnership with business.

That is why today I am pleased to announce that I am inviting applications to a Partnership Fund. The Partnership Fund will have , 5 million to help foster new attitudes and approaches to partnership in the workplace. Partnership must be seen as more than just a warm word. It should involve real changes in the workplace, new ways of working together, new approaches to training and development, new systems of performance and appraisal. There are many good examples of partnership in practice and we want the Partnership Fund to act as a catalyst, and we especially want ideas based on family friendly policies and on how the partnership approach can help small businesses.

Here in Britain we are putting in place the policies which will lay the foundation of economic success in the future, but any consideration of our future prosperity cannot ignore the question of Europe.

Now is the right time to make the case for Britain in Europe. We must do so from the standpoint of the British national interest. Nearly 60% of our trade, that is , 100 billion a year, is now within the European Union. The share of our exports going to EU countries has risen rapidly since we joined. Many markets which were closed in Europe have now been opened up and the UK has been at the forefront of that liberalisation agenda.

British jobs and investments increasingly depend on Europe. It is our key market. Our exports to France and Italy alone exceed those to the whole of North America, including the United States. Exports to Belgium and Luxembourg are double those exports from the UK to Japan. The figures speak for themselves.

Financial services, in which the City of London plays a vital role, now provide a million jobs in our country with overseas earnings in excess of , 25 billion a year. Europe is a great and growing market for these particular services.

In total, the jobs of probably millions of your members depend on Europe. As any inward investor will say, increased investment depends on two things above everything else – Britain’s modern flexible and stable economy, and its membership of the world’s largest market. There are 380 million consumers in the European Union. In the next ten years, with enlargement, there will be another 100 million more. This is the big prize that attracts the major players in our global economy.

It is against that backdrop that talk of renegotiation is so dangerous. Yet that is exactly what the Tory Party is doing. The effect of this marked shift in Tory thinking in Europe is to ensure that the issue of Britain in Europe is now at the heart of the party political debate. It means that yet again in this generation we will need to make the case for British involvement and participation in Europe, for the benefits of EU membership will once again need to be proclaimed.

This is now a battle that we must win, that we cannot afford to lose. Over the years it is a question that we have faced on a number of occasions – in or out of Europe? In the end, often after long and agonized debates, we have always chosen to be in. That conclusion has not been as a result of a triumph of political dogma over reason or by submitting to some powerful vested interest, but it has been due to sound common sense and always putting the national interest first.

Europe matters politically and economically. Influence and partnership in Europe is essential to the British national interest. The Conservatives have confused the powerful case for reform in Europe – and there is a powerful case for changing Europe – with the case for disengagement and a retreat to the margins. Those of us who believe in the importance of Europe must be the first to recognise and to argue that the Europe we have today, its institutions, its working practices and its policy priorities, are not designed for the challenges we now face. Reform in Europe is vital because it needs direction for the future. It needs to reflect the challenge of the global economy in the 21st century.

Europe must make a reality of the Single Market in all sectors. It must recognise that regulation can be a barrier to growth and job creation. To achieve this reform programme Europe needs to be more forward-looking, working to an agenda of education, enterprise and innovation so that the knowledge-based economy of the future is seen as a bringer of opportunity and not as a threat. We need to engage at all times to be building political alliances and to be shaping Europe’s development, not having it shaped by others, which has been the case far too often in the past.

As soon as we came to office we pressed the case for economic reform to make the product, labour and capital markets of Europe more flexible. Without banging the table, we have successfully promoted Britain’s interests by arguing our case and, as a result, we have been able to cap the growth in European Union spending, to win a higher share of funding from regional and structural funds for the next six years, to safeguard our nation’s border controls, to end the beef ban by agreement on the basis of solid, scientific evidence, and we have protected our rebate.

So we can see the benefits of Britain in Europe and the success that we can achieve as a result of constructive engagement. In all our dealings with Europe we must always act in the national interest. The British people would rightly expect nothing less.

That must also be our response to the single currency. There is endless speculation about the Government changing our position on the euro, that we have gone cool on the idea or that we have become more enthusiastic, that the brakes have been applied or that our foot has now been pushed down hard on the accelerator. All this press speculation has meant that a Norwegian forest has been felled for no good purpose.

Our policy remains the same. It was stated by the Chancellor in October 1997 and repeated by the Prime Minister on 23rd February this year. The Government’s view is that membership of a successful single currency would bring benefits to Britain in terms of jobs, investment and trade. The Chancellor has laid down five tests that will need to be satisfied in our national economic interest and, of course, the final decision will rest with the British people in a referendum.

Now some people argue that we should rule out joining for a period, whatever the economic conditions. Some say that we should set a date for joining, whatever the economic conditions, and I understand that we may well be hearing these arguments put forward during the course of Congress this week. Without wishing to cause offence, I want to make it clear that the Government rejects both approaches. No one will push the Government into adopting either of these two positions because we believe they are not right for Britain, they are not in our national interest. Meeting the economic conditions will be the test. It is principled, pragmatic and practical. It is our settled conviction and will remain our policy.

Congress, as we survey the world in the dying months of the 20th century, one thing is clear: we are living in a world of change. The nature of work also is changing. More of our people work part-time, and in many cases choose to do so. Many people work on a temporary basis or have fixed-term contracts. Fewer work on the shop floor and there has been an explosion of serviced-based jobs. More people work in small businesses. The composition of the workforce is also changing. More women are working. Some 52% of married women with children under 5 are now in work, more than double the situation a generation ago. More families depend on two earners.

The businesses and organisations that people work for face new challenges, more competition, a greater pressure to innovate to stay ahead and a greater pace of change. Businesses are having to become more flexible, more and more people are being asked to take on real responsibility in the workplace.

Change is the order of the day. We all need to recognise that and the union Movement is no exception. The advantage of the Government having laid down the conditions for economic stability is that it gives us all the space we need to react to these longer-term trends. We must see change as an opportunity and not as a threat.

We all have a role to play here but only if we are prepared to embrace change, because these new working patterns put new responsibilities on all of us, whether in Government, in business or in trade unions – a responsibility on Government to ensure minimum standards of fairness, to promote the benefits of electronic commerce and the Internet for business, and to create a climate for economic prosperity; a responsibility on business to work in partnership and to ensure that the task of making a reality of a flexible labour market does not fall solely on working people; a responsibility on trade unions, on yourselves, to seek consensus and not conflict, to support dialogue and avoid damaging disputes.

Flexibility does not have to, and must not, mean insecurity and poor treatment for people in the workplace. This only leads to additional stress for the many whose lives are already too stressful, leads to low morale and poor productivity. We must help people to adapt to the new world of fast changing markets and shifting patterns of work without sacrificing their quality of life. On many occasions the trade unions have been at the forefront of change over the years. You have been swift to adapt to the vast changes in collective bargaining that we have witnessed over the last 20 years.

Unions now negotiate a far wider range of packages for their members, embracing new forms of pay and new forms of working. Unions were among the first to recognise the importance of training, with support for modern apprenticeships and the need to train workers in broad based skills throughout their working lives. Unions have embraced the Investors in People approach. One reason why the UK’s health and safety record is one of the world’s best is the important role which trade unions have played on safety issues.

Union structures and services have adapted greatly to changed labour markets. The challenge for unions, as for our country, is exactly the same: it is to modernise and reform, to find new ways to work with members and their employers, to raise skills, improve productivity and play a role in making Britain a more prosperous and competitive nation.

Working in partnership with business, working with your members to strengthen their skills and to deal with a more challenging labour market is the new agenda for the trade union Movement, and it is one which we in Government support. In a world of change, to look back is to condemn yourself to opposition; this is a lesson William Hague needs to learn. We cannot a build a future for our people based on a return to all our yesterdays. Those who resist change are not learning the lessons of history but are living history.

Halfway through a Parliament is often the most challenging time for a government in office because voices call for consolidation, a reconsideration of our objectives and our priorities. But this is not the time to stand still. Now is the moment for Government to push forward on our agenda of modernisation and reform. If the world changes but we as a political party do not, then we become redundant and our principles become dogma. That is why as a party we have changed. In government we have demonstrated the nature of that change, not to betray our principles but to carry them out; not to lose our identity, but to keep our relevance.

It is because of that change that we are able to be a progressive force for fairness and justice and not an historical footnote. There can be no distractions or diversions from the task before us. Our objective must be a dynamic, knowledge‑based economy founded on individual empowerment and opportunity, where government enables but does not dictate and the power of the market is harnessed to serve the public interest.

The challenge for government is how to prepare Britain for a world in which change is continuous and knowledge is the new currency. Successful economies and societies will be those that can adapt to the demands of such rapid change, that are flexible and creative and manage change rather than become overwhelmed by it, finding new ways to include all the people. Our approach is built around a new coalition but with clear objectives to create a better standard of life for all our people to ensure British business succeeds at home and abroad, to tackle exploitation in all its forms. This is an approach which recognises that the role of Government itself has fundamentally changed, but that it still has a critical part to play in improving the performance of the British economy and improving the quality of life for all our people.

First and foremost, we must create a stable economic environment, ending the wealth‑destroying cycle of boom and bust that has dogged British business and the British economy since the war. We must never forget, and never return to, those days in the early 1990s where we saw inflation at 10%, interest rates at 15% and over a million manufacturing jobs lost.

Stability matters in our new economy because, more than ever, we need businesses to invest in knowledge and to take risks to stay ahead in fast‑moving markets. We can ill‑afford this vital investment to be put off through fears about economic stability and the long‑term future.

With stability achieved and uncertainty removed, there are great opportunities ahead. Those opportunities will only be achieved if we embrace the new and leave behind the old ways of doing things. On the eve of the new century, the challenge facing us all is how we can ensure that people become partners in change and not the victims of change. I am confident that, by working together ‑‑ trade unions, business and the Government ‑‑ we will be able to meet that challenge and, in so doing, that we will be able to discharge our joint responsibilities to your members, our people and our country.