Tag: 2001

The speech made by Gordon Brown, the then Chancellor of the Exchequer, on 5 November 2001.

I am delighted to be here this evening to pay tribute not just to the work of the CBI and to British business but to commend you – as individual company directors executives and managers – on the work you do, the service to our country you give, the difference you make to the economy, to employment and to the prosperity of Britain.

As we all know this conference is being held at no ordinary time, but in the wake of a terror so awful and so momentous that it has transformed our times and our task.

All of us here today will wish to express our sympathies to the families of those employees in the financial services and other industries and in the fire, police and other public services who lost their lives on September 11th. Many companies represented here today lost valued employees.

And because terrorists intended to bring the world’s financial system to a halt, to undermine the very prospect of global prosperity, we – Governments and business – must continue to show — as we have shown by our actions in maintaining the conditions for stability and growth — that we will not succumb or surrender to their threats.

And we have found that action, more than ever, must be coordinated not just nationally but internationally.

Britain will continue – as Tony Blair has said – to stand shoulder to shoulder with America. And it is a tribute to international cooperation that this challenge to the global economy is being met by a global response – that not only have interest rates been brought down worldwide but the central banks of America, the euro area and Japan as well as Britain have made clear their determination to take any necessary further action.

Oil prices – which have previously risen in times of trouble – have fallen in the last month and we will continue to work with the oil producing countries to ensure steadiness of supply and prices. And where markets have failed, as on airline insurance, governments across Europe and America acted to fill the gap — with a new short-term insurance guarantee.

Because no country can insulate itself from the global economy, with world trade slowing, growth slowing sharply in America, Japan and Germany and no-one yet sure about the final impact of events, these are times that are uncertain, times that test us here in Britain.

I understand people’s worries about the effects on their jobs and livelihoods of a global slowdown which will inevitably impact on Britain’s economic growth. And in the pre-budget report we will do more to recognise the vital contribution of modern manufacturing to exports, innovation and our great regions.

But it is because of the tough decisions we took from 1997 to create monetary and fiscal stability that we are today in a better position to withstand the ups and downs of the economic cycle.

Ten years ago when the US slowed at a time of international conflict, British inflation had risen above 10 percent and Government had to raise interest rates even when unemployment was rising above 2 million.

Today because we have made the Bank of England independent and have a credible monetary framework based on a symmetrical inflation target, inflation has been at or near our target of 2.5 per cent for four years. The longest period of low inflation since the 1960s.

A decade ago British interest rates peaked at 15 per cent and were above ten per cent for four years.

But because since 1997 we have combined monetary discipline with fiscal disciplines which people know we will keep, they have averaged 6 per cent. And today they are 4.5 percent, for homeowners and businesses the lowest long-term interest rates for nearly 40 years.

And while we will never be complacent, at this time of global slowdown – unlike 10 or 20 years ago – the fundamentals are sound: low inflation, stable public finances. So despite the difficulties and pressures we now face, with interest rates cut 6 times since the start of 2001 and fiscal policy supporting growth this year, I am cautiously optimistic.

We all know that as long as terrorism is allowed to threaten, our economy can never be fully secure, our society never fully at ease. So meeting the necessary cost of military action – and our international development responsibilities in Pakistan and Afghanistan – is a duty we must and will discharge, paying what it needs to root out terrorism and the supply of funds and equipment to terrorism. And it is a duty we are able to discharge because of the discipline and tough rules we have applied to public spending in the past.

But – as I have told my Cabinet colleagues and I now repeat publicly – in other areas of spending this is the time for more discipline not less. And I can say to you that, throughout, we will not relax our fiscal disciplines and we will work within the fiscal rules we set in 1997 and have upheld throughout.

Stability is the precondition but you all know as businessmen and women that it is not enough.

As the CBI and the TUC recognised when we met at Downing Street last week, at this time of global uncertainty it is even more important that we work together to enhance wealth creation and raise productivity. In the years to come we will need substantial productivity gains to continue to raise our trend rate of growth and thus our national prosperity.

While we have world class companies represented here tonight, and I applaud you for your contribution to Britain’s success, the conclusion of the CBI-TUC review submitted to the Government last week is that overall productivity in Britain is still far too low and that if we are to achieve our aim for this decade – the fastest rise in productivity of our competitors – we will, all of us, with labour market, capital market and product market reforms have to modernise, change and reform.

Tonight I want to assure you from the Government that not only will we continue our policy of moving the unemployed from welfare to work – indeed we will enhance both the New Deal’s opportunities and sanctions – and our measures to enhance labour market flexibility as a contribution to higher productivity, but we will also, in consultation with you, move forward the enterprise agenda:

First, to reward enterprise and entrepreneurship I can say tonight that the Budget will significantly extend our cuts in capital gains tax. I will propose that for business assets held for 2 years, capital gains tax which in 1997 was 40 per cent will be cut to 10 percent – designed to provide incentives for investment in wealth creation and greater rewards for success – indeed a more attractive capital gains tax regime overall than the United States.

Second, in the next Budget I will also propose extending our cuts in small company corporation tax where instead of 23p in the pound the rates are now 20p and in many cases only 10p, and there will be a simplification of the VAT system as we introduce further deregulatory measures to help small businesses.

Third, many of you have rightly complained about complexities, delays and anomalies in our physical planning system. We will reform and modernise our physical planning laws and Steven Byers will publish in the next few weeks a Green Paper promoting reform which will strike the right balance in a modern economy which puts an ever higher premium on speed, efficiency and flexibility – especially to reflect the widely differing needs of all our regions.

Fourth, we are introducing a new competition regime – with decisions taken out of the hands of politicians and truly independent of the political process – that will match the best in the world.

Fifth, your needs include the best skilled manpower and work ready staff, and we are ready to fulfill our responsibilities by putting additional resources into a reformed training system and ready to sanction an extension of the work permit system that has already raised entrants to the UK from 50,000 three years ago to 150,000 this year.

Sixth, the efficiency we seek in the private sector we demand in the public sector. Having doubled net public investment, Government at every level – national, regional and local – must raise its game. We will maintain our £180 billion ten year plan to modernise our transport infrastructure – and any one of you who have travelled across Britain know the importance to business and communities of this doubling of transport investment

And I leave you in no doubt that we will continue our programme of public private partnerships. Whether it be in the London Underground or in the air traffic control service, I am convinced that instead of the old sterile divide which pitted public against private, we do best when public and private sectors work together to enhance investment in our transport and infrastructure.

And if we as a nation are to have a deeper and wider entrepreneurial culture we must do more to extend knowledge of enterprise to every community. We all know that for too long the world of business and the world of education existed apart from each other. With your support I want every young person to hear about business and enterprise in school, every college student to know there are opportunities in business, every teacher able to communicate the virtues of enterprise, and I want young people growing up to see successful business leaders locally and nationally as role models, so encouraging a stronger pro-business, pro-enterprise, pro-wealth creating environment in our country.

It is not just in Britain but in Europe as a whole that a modern route to both economic stability and a more entrepreneurial economy based on economic reform is needed.

As in Britain, the euro area has been establishing a new framework for economic stability.

As I set out at the Lord Mayor’s Banquet earlier this year, our approach is – and will continue to be – considered and cautious: one of pro-euro realism.

Pro-euro because, as we said in 1997, we believe that – in principle – membership of the Euro can bring benefits to Britain.

Realist because to short-cut or fudge the assessment, and to join in the wrong way or on the wrong basis without rigorously ensuring the tests are met, would not be in the national economic interest.

A single European currency – with a fully developed single market – could in principle increase trade and competition through the elimination of exchange rate risk and through more transparent prices; reduce transaction costs, again increasing trade and investment, and benefiting everyone travelling in Europe; and lower long-term interest rates, again good for investment and so good for growth and jobs.

Because the Government is determined that we will make the right long-term decisions for Britain, we will not take risks with Britain’s hard won stability.

So the assessment as to whether it is in the British national economic interest or not will be comprehensive and rigorous. It is only on this basis – taking into account all relevant economic information – that the Cabinet will decide whether to recommend membership to Parliament and then to the British people.

While the assessment has not yet started, the necessary preliminary analysis – technical work that is necessary to allow us to undertake the assessment within two years as we promised – is underway.

The scope of the technical and preliminary work for the next assessment of the five tests is as set out in the original October 1997 assessment. Although there have been new developments since the 1997 assessment, the underlying issues to be analysed remain the same.

The 1997 statement detailed five economic tests:

– First, sustainable convergence between Britain and the economies of a single currency;

– Second, whether there is sufficient flexibility to cope with economic change;

– Third, the effect on investment;

– Fourth, the impact on our financial services industry; and

-Fifth, whether it is good for employment.

Now the preliminary and technical work is updating the analysis on:

The cyclical behaviour of the UK economy relative to the euro area and their relative responses to economic shocks;

The mechanisms by which product, labour and capital markets adjust and how well and how quickly they work;

The impact of the single currency on the cost and availability of capital, macroeconomic stability, the stability of the real effective exchange rate and the location, quality and quantity of investment;

The effect of the single currency on financial services, including the changes that have occurred in this sector in the UK and the euro area since 1997; and

The impact of the single currency on trade, competition, productivity and employment.

Our commitment is to complete a full assessment of the five tests within two years of the start of this Parliament.

And I can tell the dinner this evening that our commitment “to prepare and decide” is being maintained with the publication of the latest euro preparations study today.

We have always said that we must prepare together – not one or two businesses, but Government and business working together.

The Government’s Standing Committee on Euro Preparations – with membership drawn from the public and private sectors, including the president and Digby Jones – met again last Monday as a key part of our consultation.

And we are today publishing our latest Progress Report on Euro Preparations. In just a few weeks’ time, Euro cash will displace existing currencies in the euro area. This will have an impact on many UK businesses and also on citizens in their capacity as tourists. I an pleased that Government and the CBI are working together to give advice to businesses – indeed the next phase of our information campaign starts today, including the direct mailing of sample case studies and an information booklet to 1.5m SMEs.

And in addition to this help for business, together Peter Hain and Ruth Kelly will also be sending out an information leaflet for UK travellers to help them with the transition to notes and coins.

Planning for possible UK entry also continues under the national changeover plan. The Government has invested £13m since the publication of the last Report on Euro Preparations in November last year, bringing the total invested on changeover planning to £23.5million.

These are the preparations we are making together. Because we are resolved we will not leave Britain economically unprepared.

Around the future of the Euro there is of course an ongoing national debate.

But across Europe a wider debate on the future of Europe is also taking place and Britain must be at the centre of that debate too – a debate on economic reform amidst the challenge of globalisation, enlargement into the east and the wider Nice agenda to make decision making in Europe more accountable and relevant to the population as a whole.

Europe is where we are, where we trade, from where thousands of businesses and millions of jobs come. We are part of Europe by geography, by history, by economics and by choice. So the case is not only for a reformed Europe but for Britain leading reform in Europe.

Getting the economic future for Europe right matters for Britain because over three quarters of a million UK companies now trade with the rest of the European union. When we joined Europe in the 1970s, less than 8 billions of our trade was with the rest of Europe. Today it is £138 billions – more than half our total trade – with 3 million jobs affected.

But while the single market encompasses 375m people today – and potentially nearly 500m in the future – we still have a long way to go to secure for British business and British consumers the full benefits in commercial opportunities and consumer prices.

The 1988 Cecchini report examined in depth the potential economic gains of the single market, asserting that completing it would raise GDP by 4.5 percent and create 1.8 million new jobs.

Yet by 1996, the boost to GDP had been only 1.5 percent and almost 1 million new jobs had been created. And there is little to suggest that by 2001 we have realised even half of the potential gains. So we will publish a White Paper on Economic Reform setting out the next stage of our plans to liberalise capital labour and product markets

There are those who say that in the current climate Europe can justifying going slow on its programmes of economic reform, that now is not the time for pushing forward with change. I say to them that now is the time – when we can see the interdependence of our economies and the challenges of globalisation more clearly – now is the time to drive forward the reform agenda to improve the flexibility and productivity of the European economy.

Firms across the UK will benefit with new opportunities to trade in the 14 member states if:

– We complete liberalisation in telecoms by the end of 2001, capital markets by 2003, financial services by 2004;

– Continue to push energy liberalisation, promote tax competition not tax harmonisation, drive down old fashioned state subsidies which undermine the single market while ensuring the state aid regime tackles market failures and promotes efficient dynamic competitive markets;

British financial service firms are well positioned to benefit from the completion of the internal market in financial services.

But what we do not want are directives simply designed to increase regulation at the expense of liberalisation. I know that the prospectus directive is a particular concern for the CBI and its members in this respect and the Government will continue to focus on the outcomes for firms and consumers that we are trying to deliver.

And Europe must focus not just on internal reform but because I believe fortress Europe is an idea that has had its day we must focus on how Europe can be less inward looking and more outward looking and more open to trade and commerce with the rest of the world.

Here again the economic reform agenda is clear and challenging: and first and foremost it is crucial that we ensure the launch of a broad and balanced trade round in Doha. The EU and the US should work closely on pushing for greater market access for the developing worlds, have high ambitions to eliminate industrial tariffs, and make genuinely liberalising deals on agriculture, investment, competition and the environment. The gains can be in the order of 400 billion dollars a year, 150 billion for the developing countries. Moving forward trade liberalisation at Doha in the next few days will send out a powerful message of our confidence in the future of the world economy.

And we can do more. The annual two way flow of goods, services and direct foreign investment between the United States and Europe is now nearly a trillion dollars and we need only look at the impact of the American slowdown on European economic growth to understand this growing economic independence.

So strengthening our ability to push forward with the multilateral trade agenda, the conditions now exist for the expansion of the transatlantic economic partnership, mirroring our security alliance in NATO. And here what we need now is a Cecchini-style report that set outs in detail the benefits for growth, prosperity and jobs on both sides of the Atlantic from a wide-ranging effort to end the remaining industrial tariffs multilaterally, achieve deeper liberalisation of trade in services, remove unnecessary non-tariff barriers, increase competition and develop more effective ways of pre-empting damaging transatlantic trade disputes.

We in Britain do not have to choose – as some would suggest – between America and Europe, but are instead well positioned as a vital link between America and Europe.

So this is a time of great challenges and risks but also a time of great opportunities – in Britain, in Europe and across the world.

I believe that, learning from each other, all of us – businesses and Governments working together – can face the great challenges of today’s economy not by resisting change but by helping people cope with it; not by standing still but by radical economic reform; and not by protectionism but by promoting open, competitive markets and international cooperation.

It makes for a Britain that is true to its great historical qualities: outward looking and open to the world, committed to an enterprise culture and ambitious to succeed; fully equipped to lead in the 21st century economy.

The speech made by Gordon Brown, the then Chancellor of the Exchequer, in London on 19 December 2001.

I.   Introduction

I am delighted to be addressing the Local Government Association General Assembly.

You represent the democratic leadership of our cities, towns and communities across England and Wales, and I want to begin by acknowledging and indeed congratulating you for the work you undertake, the hours you give up, the service you offer, the good you do and the difference you make in building stronger communities – making the very idea of community work in practice.

And I am here today to celebrate the importance of our strengthening partnership, a modern partnership between central and local government without which neither of us will be able to deliver the stronger economy and better services the British people have demanded of us.

It is a partnership not of convenience but a partnership of principle because whenever we walk down the street, collect our kids from school, turn to the emergency services, or look for help for the weak and the frail we know we all depend upon locally provided services.

It is a partnership of principle because every day a millions of acts of service by dedicated public servants  – inspired not just by individual commitment but by a higher ideal of duty and obligation – shape the ethos of public service in our country.

And our partnership -local and central government working together – is strengthened by an equally important belief we share in common: whatever people said in the past we know that Whitehall does not know best, and we know that effective service delivery for families and communities cannot come from central command and control but requires local initiative and accountability.

For all the time I have been involved in politics I have believed in devolving power, so that those who are affected by the decisions are close to and can hold accountable those who make the decisions – and our aim must always be the maximum devolution of power possible: government encouraging not stifling local action, local people making local decisions about local needs.

And our strengthened partnership today in 2001 is built on something equally fundamental: on our commitment to advance shared goals, to ensure opportunity and prosperity not just for some in our country but for all.

First: to strive for full employment – from a foundation of economic stability strengthening the programme to move the unemployed from welfare to work, so that in every region there is employment opportunity for all;

Second: raising productivity to match our European competitors and thus raising our living standards – with a commitment for every region to high quality long-term investment in science and innovation, new technology and skills;

Third: eliminating child poverty – ensuring not just some but all children have the best start in life;

Fourth: tackling pensioner poverty and ensuring pensioners enjoy dignity in retirement;

Fifth: from transport and housing to health and education renewing our public services to rise to today’s needs – meeting people’s rising expectations by delivering high quality public services for all.

In the LGA’s six commitments portfolio – which I am delighted to launch today – you are also setting out your priorities and I see exactly the same focus on full employment, world class public services, no child left behind and for every pensioner the best of care.

And my message today is that the great challenges that face our country cannot be met if we stand apart from each other, can only be met if we work together. Indeed the key insight of these last four years is that the goals we share cannot be realised in practice without central government devolving power to local communities.

II.   A new central- local government partnership

Our first task in 1997, and the foundation of all we do, was to create a national framework for stability, for sound public finances and for employment growth

And the difficult decisions we took then – to make the Bank of England independent, to rein in spending, to cut debt, to put up interest rates – are the platform not just for low inflation and 1.2 million more in jobs but also for the largest sustained growth in investment in our public services for fifty years with:

– Growth in spending of 4 per cent on average this year, next year and the year after;

– public investment almost doubling year on year this year, and rising to three times its 1996-7 level by 2003-4;

– £10 billion a year saved from debt and low unemployment now invested in health, education and our public services.

And as we started putting in place this new national economic framework we also began putting in place the building blocks that allow us to devolve power and responsibility.

In the first parliament we created a devolved legislature in Scotland, Wales and Northern Ireland, restored city-wide local government to London, and created regional development agencies. And at the beginning of this year John Prescott and I set out our plans for a new generation of regional policies – strengthening, within the regions, the essential building blocks of self generating growth, the capacity to innovate, invest, build skills and match the unemployed to jobs available. Offering development agencies new freedoms and flexibilities and in return demanding strenuous targets be met in skills, innovation, business creation, new technology and employment. A new regional policy – locally sensitive and locally delivered, one through local management decisions.

And just as we made a start with regional policy in the last parliament we also made a start in devolving power to local government, moving away from the destructive centralism characteristic of the years marked by universal capping, Compulsory Competitive Tendering and the Poll Tax.

So in the past few years we have:

– Boosted financial support for councils, through real terms increases in revenue and in capital expenditure for four years in a row

– Replaced the bureaucracy of CCT with the duty of best value, enabling councils to develop their own methods of service delivery rather than being constrained by the requirement to cut costs at all cost

– Improved the transparency and efficiency of local leadership through provision for new constitutions for local government following local consultation;

– Expanded the capacities of local government by introducing statutory community strategies, and a new power to promote community well-being through coordination and partnership with other local actors, via local strategic partnerships and the neighbourhood renewal fund.

Showing our approach is a belief in local government not local administration.

In the first parliament, to support our national public service agreements we developed local public service agreements. And as I said to the Labour party conference in February this year, over the next two years the number of local PSAs matching resources to outcome targets signed with local authorities is rising from 20 earlier this year to 150 by 2003  – which we will match with further steps towards greater flexibility: flexibility and resources in return for reform.

III.    New partnership

These are only the first steps in expanding our partnership and we are now ready to do more to achieve our goals of full employment, higher quality of public services, and an end to child and pensioner poverty – combining more flexibility and more resources in return for more reform and better results.

And as set out in the White Paper launched by Stephen Byers last week, we are:

– Abolishing the council tax benefit subsidy limitation scheme and providing greater freedom for all councils to decide council tax discounts and exemptions

– Making councils themselves responsible for deciding how much they can prudently borrow; providing greater freedom for councils to invest;

– Removing unnecessary bureaucracy as well as targeting a reduction of 50 per cent in the numbers of plans and strategies that government requires councils to produce;

– Providing councils with wider powers to deliver services to others and to work in partnership;

– Restricting ring-fencing to cases which are genuine high priorities for government and where we cannot achieve our policy goal by specifying outcome targets.

And high performing councils will receive extra freedoms to lead the way to further service improvements including:

– The ending of reserve powers over capping, as a first step towards our long term goal of dispensing with the power to cap altogether

– Further reductions in ring fencing of revenue from central government, and of support for capital investment

– More freedom to use income collected locally from fines and charges

– Extra exemptions from the plan requirements of central government, and more discretion over best value programmes

– And a much lighter touch inspection regime

Reforms that will significantly expand the freedoms and flexibilities available to local government.

Our approach is to devolve power and responsibility so that these freedoms will be accompanied by greater accountability to local communities.  That is why alongside devolution of power we will introduce a new comprehensive performance framework – providing clear and concise information about councils? performance, enabling us to make our inspection regimes more proportionate, to target support where it is most needed, and to identify the small minority of failing councils in need of tough remedial action.

A democratic framework for devolving power to modern local authorities based on new rights and new responsibilities – the power you need to improve your performance – the responsibility expected of you to serve your communities.

And in this Parliament we are ready to go even further to enable local people to do more to make local decisions about meeting local needs. Already the option of congestion charging is now available and being implemented in London. I believe that we should be prepared to consider further radical options to ensure devolution of power and responsibility go hand in hand so that the public can get the best possible services.

And once we have carried out further analysis, we shall establish a high level working group involving ministers and senior figures from local government to look at all aspects of the balance of funding, reviewing the evidence and looking at reform options.

IV. Putting partnership into practice

So let me set out how – through local and national government working together, building on the new freedoms and flexibilities the white paper has put in place – we can rise to today’s challenges and meet our shared goals.

First, employment.

I could talk about the 1 million jobs we have created, but i am more anxious about the 1 million men and women still left out, still unemployed – and as local councillors I hope you will want to play a bigger role in the next steps to help the newly redundant get back into work quickly and expand the new deal to assist those hard to employ. This means following the innovative example of councils such as Brighton and Bristol, councils that have tailored supplementary employment programmes to complement the new deal.

Last month Alistair Darling announced 20 special projects to test whether guaranteed jobs for the long term unemployed could get more people permanently off the dole. It is a new opportunity – a guaranteed job – but there is also a new obligation to take it up. And as we learn from these successes, I hope we can work together to make long-term unemployment a thing of the past, and make possible full employment in every region and every community.

Second, the economy and enterprise.

Every one knows that the sources of growth in every local economy are local innovation, local skills, and local enterprise. More jobs of the future will come from small businesses growing in each of your areas than from large inward investment projects.
So together we must remove the barriers that prevent local firms starting up, growing bigger, getting investment in capital, finding export markets and training skilled staff.

That is why together in every local area we must bring about a revolution in education, skills and training.

As long as prosperity by-passes a single community or a single family our work is not yet done.

And it is why together we must concentrate on lifting up the high unemployment areas that for too long have been left behind and why we have introduced – and i hope you can encourage local economic activity to benefit from:

– A cut in VAT on residential property conversions to 5 per cent

– 100 per cent first year capital allowances for bringing empty flats over shops back into the residential market;

– Legislated for an accelerated tax relief set at 150 per cent for cleaning up contaminated land;

– The abolition of stamp duty for property transactions up to £150,000 so that in 2000 wards across the country the buying of property and bringing land back into use will be tax free; and

– Legislate in the budget for a new tax credit for local community investment.

We want to see a dynamic, enterprising public sector at all levels. And that is why we will give you new freedoms to innovate and to experiment, with wider powers to trade in public, private and voluntary sectors, as well as allowing councils to introduce business improvements districts. And just as we have released borrowing restrictions on local airports, I am prepared to consider how within the new prudential borrowing regime we can engender more freedoms for local government consistent with macro – stability and our fiscal rules.

Third, ensuring every child has the best possible start in life.

You have been responsible for pioneering the development of childcare in the most difficult of circumstances.  Since 1997 we have learned from your successes and it is thanks to you as councils that we can have nursery education with places for all four-year olds – and soon all three-year olds.

And thanks to your imagination and commitment we now have a national childcare strategy to ensure affordable, accessible and quality childcare in every neighbourhood, creating by next year new childcare places for 1.6 million children.

Child poverty is a scar on the soul of Britain, and we must work together – local and national government to make sure that we give each and every child the best possible start in life  – and that no child is left behind.

Our first task as a government was to boost the income of all families with children, with the greatest help for those in greatest need. And that is why since 1997 we have increased child benefit to £15.50 for the first child so that, combined with our other tax and benefit reforms, our poorest families are now better off by 1700 pounds a year on average – money to all children. And having already lifted more than 1 million children out of poverty, we will introduce the child tax credit as well as work towards taking the second million out of poverty – moving closer to eradicating poverty completely.

Our second task is to match higher incomes for these families with better services. I welcome the LGA’s commitment in this area. And I hope that we can work together to develop imaginative ways of delivering these services for the communities you represent building on the innovative examples set by councils such as Sunderland, whose local PSA is providing an active citizenship plan for its children and young adults, or Darlington, which has created a one-stop shop delivering an integrated service for all children in need – demonstrating to us all what pioneering local government is able to do.

In the new economy, which depends on knowledge, innovation, on mobilising the talents of all – getting the best out of everyone – it is essential to develop all the potential of our children. And it has been a tragedy of wasted potential for our country that there are thousands of young people with talent and ability still denied the chance to make the most themselves.

That is why in the four years up to 2003 the real terms growth in education spending will be more than 5 per cent a year and we will in the new spending round make education a priority.

And in the past five years we have worked with you to put in place the framework for addressing the needs of our nation’s children, with local government directly engaged in:

– Sure start for under fives;

– The children’s fund, now rolled out across 40 areas, for 5-13 year-olds;

– Connexions for 13-19 year olds;

– “quality protects” for all children in need;

– And professional learning mentors

Programmes with a new partnership between local government and voluntary organisations to support all our children and identify those who are showing signs of difficulties – providing them and their families with the support they need to overcome personal and social problems.

Fourth: pensioners

Pensioner poverty is a reproach to us all.

And just as we are working to eliminate child poverty – so too we must act now to ensure that pensioners are able to enjoy a higher standard of living.

So we are building on the Basic State Pension – cash increases which boost the incomes of all pensioners – with the Minimum Income guarantee – targeting extra financial support on the poorest pensioners. We have also set aside new funds to ensure that, from 2003, pensioners whose hard work has secured a small occupational pension or modest savings, will be rewarded through the new Pension Credit by extra money, not penalised – as in the past – by losing their benefits – ensuring that pensioners enjoy a share in the rising prosperity of our country.

But we must match higher incomes for pensioners with improved community services – both for pensioners in care and those living in housing which needs to be maintained to a higher standard. We have made a commitment to make decent all social housing by 2010 and have already invested £7.3 billion in local authority housing.

Our task is to match resources with reform in social services and housing. And to help local authorities to be more flexible and innovative, we are:

– Providing local authorities with increased freedoms in the way they deliver social services as their performance improves;

– Investing £460m in high performing local authorities to set up companies to manage their housing stock, leaving them free to think more creatively about the housing strategies they wish to pursue; and

– Extending the prudential borrowing freedoms to housing expenditure, allowing local authorities to choose the best way to invest in their housing.

And in the forthcoming spending review we will do more.

Finally, fifth: I turn to our shared commitment to public services as a whole.

For 20 years at least your job as local authorities had been to protect public services against those who wanted to dismantle them.

Our task together now is different.  It is to move from the old narrow agenda of the years of self protection – when many argued that saving the service had to come first – to the positive task of building, investing, reforming and modernising.

In the public services we are employing more – 140 thousand more in jobs, investing £8 billion more, and with private sector investment of £4.4 billion – making public investment go even further.

There is a new debate in this country – not just about the future financing of our public services, including our health service, but about more than finance – about the future of our public services.

And those of us who believe passionately in the public services must be the most determined to modernise and reform so that public services can best serve the public.

Just as schools exist for school children, the NHS exists for patients; public services exist not for the public servant but for the public who are served.

And our aim must be that every classroom has the best teacher, every school the best staff, every operating theatre the best doctors and staff, every police station the best police men and women – that every public service has the best public servants.

Just as we cannot serve the public if investment is low, staffing poor and conditions unacceptable, we cannot serve them either if service is poor, if performance is faulty, if the atmosphere is confrontational.

Those of us who believe in the public services must learn from both the public and the private sectors and revitalise our public services from the inside or others will seek to dismantle them from the outside.

We will maintain our 180 billion pound ten year plan to modernise our transport infrastructure – a doubling of transport investment.  And we will continue our programme of public private partnerships.  Whether it be in the London underground or in the building on new hospitals, I am convinced that instead of the old sterile divide which pitted public against private, we do best when public and private sectors work together to enhance investment in our transport and infrastructure.

And we should aim for higher productivity in our public services, backing management as well as employee training. And i can tell you that we are supporting the national college of school leadership and the leadership centre for the NHS, devoted to doing more to improving the quality of public service management.

In Britain we rightly pride ourselves in our ethos of public service – an ethos across all areas of the country and across all political persuasions – and a tradition of distinguished public service in Britain that run deep in our history- a tradition for which people from all over the world rightly look to Britain.

All of us can tell our own story about the importance of that ethos of the public service – not just about the past but about the present.

For me, every opportunity I have had – the best schooling, the best chance at university, the best health care when ill – every opportunity I have enjoyed owes its origin to the decisions the British people made to open up opportunity, and ensure there are decent public services.

Just as good teachers have an extraordinary power to make a difference to peoples lives – so too we know nurses and doctors who everyday can make the difference between life and death – social workers, who can transform hopelessness into hope – home helps and care assistants who for the frailest and the weakest make public service the mark of civility – street orderlies and ancillaries who show by their commitment why public service is about improving the quality of life. And if you’ve ever been involved in an emergency remember the calm unflappable skill, the professionalism, and offering self-sacrifice of all our public service.

It shows we are not simply self interested individuals isolated or sufficient unto ourselves but men and women who share the pain of others, a belief in something bigger than ourselves, and who – to paraphrase Robert Kennedy – see pain and seek to heal it see suffering and seek to triumph over it see injustice and seek to overcome it.

Each time a good is done it sends out a message that duty, obligation and service are at the heart of a country that believes there is such thing as a society.

And it is from these acts of selfless dedication inspired by a higher ideal of duty and obligation that not just the ethos of public service is shaped but the very character of our country.

And just as under this government a NHS will be modernised for the coming generation as a national health service free at the point of need – so too public services will be reformed for the coming generation as locally managed public services there to serve the public.

If by our actions you or I, each of us, could lift just one child out of poverty, give one young person a chance of training and a job, give one more person suffering from pain the chance of the help they deserve, give one more classroom the books and computers it needs, secure for one more pensioner a greater measure of dignity and decency in retirement, then we are doing something not just for ourselves but for our communities.

But if working together, national and local government, we can be at the service of whole communities, we can do far more- giving every child the best start in life, creating a Britain where there is employment opportunity for all, offering security for the elderly in retirement, building from the foundation of economic stability public services we can all be proud of. Working together in our partnership of principle.

This is our shared challenge and – working together in partnership – that can be our achievement.

The speech made by Gordon Brown, the then Chancellor of the Exchequer, in Washington, the United States, on 17 December 2001.

Let me first on behalf of Tony Blair and the entire UK Government, which has been proud to be America’s first and strongest ally from the first moment the planes struck the World Trade Centre and the Pentagon, salute the courage of America in face of tragedy: your bravery and resilience in the most testing of times.

America has shown by the actions of all its people that while buildings can be destroyed, values are indestructible; while hearts are broken, hope is unbreakable; and while lives have ended, the cause of liberty never dies.

The war that together we are fighting against terrorism – not as a war for territory but as a war for values – we will win.  Of that I am confident. But the question I want to address today is how we will win the peace.

This is not the first time the world has faced this question – so fundamental and far-reaching.  In the 1940s, after the greatest of wars, visionaries in America and elsewhere looked ahead to a new world and – in their day and for their times — built a new world order.

And what they sought to create was not simply a new military and political settlement that guaranteed peace but also new rules and institutions for a new international economic and social order that would guarantee prosperity.

Coming to America from Europe – the beneficiary of that post 1945 American generosity – I can testify to the greatness of the achievement.  Indeed such was its scale that one of the architects of the new order – Dean Acheson – recalled that he had been present at the creation.

In the truest sense they fought on after victory.  They understood that, tempting as it might be, a retreat into isolationism was neither possible nor desirable.  And what they achieved as they fought their day’s greatest evil – totalitarianism – is what we must seek to achieve as we fight today’s greatest evil – terrorism.

I want to urge that together we form a new global alliance for prosperity that starts from the shared needs, common interests and linked destinies of developed and developing worlds working together.

I want to describe how America’s post-Second World War achievement in what we now call the Marshall Plan should be our inspiration in this post-cold war world — not just for the reconstruction of Afghanistan but for the entire developing world.

The plan proposed by US Secretary of State George Marshall transferred one per cent of national income every year, for four years, from America to Europe – in total the equivalent in today’s money of 75 billion dollars – not as an act of charity, but as a frank recognition that, like peace, prosperity was indivisible; that to be sustained it had to be shared; and that to achieve this goal would require a new public purpose and international action on a massive scale.

Marshall and his colleagues also understood that the challenge extended far wider than the war-torn countries and was about more than temporary aid;  that by combining historic American compassion with enlightened self interest not only did they advance the spread of prosperity but the spread of democracy too.  Indeed by identifying undemocratic as well as unstable regimes as a problem – and the attainment of democratic reform as well as economic reform as a solution – the world could best move forward.

This is what George Marshall meant when, in his great Harvard speech, he articulated his great, unifying vision for a global fight, not against one country or one ideology, but against “hunger, poverty, desperation and chaos”.

And this is why he proposed to transfer resources on such a scale: not merely to secure “a working economy in the world” but, even more important, to “permit the emergence of political and social conditions in which free institutions can exist”.

These were George Marshall’s fundamental aims in 1947, and his vision resonated across the decades that followed – defining the very character of the next half century, defining the very essence of global cooperation.

And they ring with relevance in our own time too.

Just as the urgent needs of Greece and Turkey provided the catalyst for the Marshall Plan, today’s plans for global reconstruction are precipitated by a specific challenge – that of Afghanistan and Pakistan.

Like our predecessors, we understand that national safety and global reconstruction are inextricably linked.  Like them we see the need for a new economic leadership – a comprehensive plan that goes beyond temporary relief to wholesale economic and social development. Like them we see the need for a new global economic and social order grounded in both rights and responsibilities accepted by all. Like theirs, our proposals call on the poorest countries themselves to rise to the challenge.

But while there are parallels between our time and 50 years ago no historical analogies can ever be exact.  Far more so than in Marshall’s time, our interdependence means that what happens to the poorest citizen in the poorest country can directly affect the richest citizen in the richest country. And while the Marshall Plan deserves an honoured place in our history its remedies cannot be blindly or rigidly applied to efforts to solve the challenges of today and the future.

The Marshall Plan was constructed in a post-war world of distinct national economies in need of rebuilding.  Our job is now, in a more interdependent world, to help build – for the first time – market economies for a wholly different environment of open not sheltered economies, international not national capital markets, and global not local competition.

And 50 years on we not only see more clearly our interdependence but the gap between what technology enables us to do – abolish poverty – and the reality of 110 million children without schooling, 7 million avoidable child deaths each year and 1 billion of our citizens in poverty.

It is for these reasons that the whole international community – the IMF, World Bank, the UN and each of our countries – has solemnly committed to the most ambitious development goals for 2015: to halve world poverty, cut child mortality by two thirds and guarantee every child primary education.

Our plan is this:  developing countries must pursue corruption-free policies for stability, for opening up trade and for creating a favourable environment for investment.  In return, we should be prepared to increase by 50 billion a year in the years to 2015 vitally needed funds to achieve these agreed millennium development goals.

The development funding I propose is not aid in the traditional sense to compensate for poverty, but new investment in the future to address the causes of poverty.  In the last 50 years the Marshall Plan’s European model could not be applied wholesale to developing countries because neither the economic foundations nor the necessary open, transparent and accountable systems for managing the public sector were properly in place to prevent corruption and waste.  And too often we saw development funding as short term charity aid, charity for being poor, instead of for a higher and more substantial purpose – long term investment tied to tackling the underlying roots of poverty and promoting sustainable growth.

Indeed the proposal I am making today will work only if we see development assistance in this light:  more effective in-country use of funds to help countries invest and compete; the multi-national pooling of budgets and the proper monitoring of their use to achieve the greatest cost effectiveness of new investment; untying aid so maximising its efficiency in diminishing poverty; and development funding conditional on pursuing agreed goals for social and economic development.

Indeed our proposals are designed to create the best environment for private investment to take off and flourish by increasing funds for investment in health and education – not typically areas in which private capital flows but areas in which public investment is necessary to create an environment in which private investment can flourish.

Our vision of the way forward — akin to Marshall’s challenge to rich and poor countries alike — is that by each meeting their obligations for change all countries can benefit.

For the poorest countries: new responsibilities – to pursue transparent corruption free policies for stability and the attraction of private investment – and new opportunities – with access to increased trade and development supported by a transfer of resources from rich to poor for investment in health and education.

For the richest countries: new responsibilities – to open our markets to reform our international institutions and to transfer resources – and yet new opportunities too – increased trade and a globalisation that works in the public interest.

In future no country genuinely committed to pro-stability, pro-trade and pro-investment policies should be denied the chance of progress through the lack of basic investment in education, health and the basic infrastructure for economic development.

And this is our answer to globalisation and to the critics of globalisation.

Some critics say the issue is whether we should have globalisation or not.  In fact, the issue is whether we manage globalisation well or badly, fairly or unfairly.

Globalisation can be for the people or against the people.  Poorly managed, globalisation can create a vicious circle of poverty, widening inequality and increasing resentment. Managed wisely it can lift millions out of deprivation and become the high road to a more just and inclusive global economy.

Our answer to anti-globalisation campaigners – as I will demonstrate today – is that we shall not retreat from globalisation.

Instead we will advance social justice on a global scale – and we will do so with greater global cooperation not less, and with stronger, not weaker, international institutions.

We will best help the poor not by opting out or by cutting cooperation across the world, but by strengthening that cooperation, modernising our international rules and radically reforming the institutions of economic cooperation to meet the new challenges.

Rules of the game for the global economy

So what are the building blocks for putting this new alliance for prosperity in place?

The first is the most basic: the pursuit by developing countries of corruption free, pro-stability policies building their capacity to compete and improving the terms on which they participate in the global economy.

Round the world the importance of monetary regimes that ensure low inflation is now well understood. There is a greater consensus now than ever before that there is no long term trade off between inflation and growth or unemployment and that without control of inflation long term growth is impossible.

But building from that basic understanding, we need to do more to ensure stability in a new world of ever more rapid financial flows.

Developing countries who need capital most are at the same time the most vulnerable to the judgments of global financial markets.

We know that capital is more likely to move to environments which are stable and least likely to stay in environments which are or become unstable.  And such flows today are quicker than ever they have been before.   So for every country, rich or poor, macroeconomic stability is not an option but an essential pre-condition of economic success.

And I have become convinced that it is in the interests of stability – and of preventing crises in developing and emerging market countries – that we seek a new rules-based system — a reformed system of economic governance under which each country, rich and poor, adopts and operates agreed codes and standards for fiscal and monetary policy and for corporate governance.

Clear transparent procedures for monetary and fiscal decisions include presenting a full factual picture of the national accounts, usable central bank reserves, foreign currency borrowings, and indicators of the health of the financial sectors. Such openness – and a willingness to be monitored for it – would improve macroeconomic stability, deter corruption, provide to markets the flow of specific country- by-country information necessary to engender greater investor confidence and reduce the likelihood of contagion. Operating such codes can also support countries along the way to liberalisation of their capital markets, offering them a route map to avoid destabilising and speculative inflows.

Just as I believe that – over time – the implementation of codes and standards should be a condition for IMF and World Bank support, so too I believe that the international community should offer direct assistance, transitional help and – in some specific and difficult cases – compensation for the early implementation of such codes.

And where countries do operate transparent and effective policies, the IMF’s contingent credit line facility should play a far more proactive role in helping member countries strengthen their financial position, guard against contagion and thus avoid crises.

So these codes are not incidental to the financial architecture for the new global economy: they are the financial architecture for the new global economy, as we move from a global economy which has simply let crises happen to one where we work to diminish their likelihood.

Our capacity to prevent crises is enhanced not just by the operation of codes and standards – and the offer of proportionate help to countries who adopt them – but also by rigorous surveillance, effective international early warning procedures and a more consistent engagement by the private sector.

The new architecture must therefore involve an enhanced role and authority for the IMF, monitoring and reporting on the operation of codes and standards, and my proposal is that we make the IMF’s surveillance and monitoring functions independent of the inter-governmental decisions about financial support for crisis resolution.

Alongside greater independence for the IMF, the capacity to prevent crises would be improved by expanding the work of the financial stability forum – which brings together the combined expertise of the IMF and key regulatory authorities – as an international early warning system to tackle national financial sector problems which have international repercussions.

Where governments discharge their responsibilities for transparency and subject themselves to surveillance, then commensurately increased responsibilities by the private sector should include a willingness to participate in ongoing dialogue with their host countries to identify problems early and develop cooperative solutions for restoring stability.

Where crises do occur, better crisis resolution procedures should involve private creditors, with improved arrangements for the use of standstills and more effective international bankruptcy procedures.

Investment

Open, transparent and accountable national policies, internationally monitored, are the foundation for monetary and fiscal stability. But to ensure the long term investment necessary for growth and development we must do far more.

Rich and poor countries must work together to make investment itself more attractive to both domestic and foreign lenders and find better ways for public and private sectors to cooperate to raise investment levels.

Experience from the 80s onwards has moved us on from the assumption that just by liberalising, deregulating, privatising and simply getting prices right, growth and employment would inevitably follow – a set of assumptions that has proved inadequate to meet the emerging challenges of globalisation in for example Asia where public investment has played a catalytic role in securing growth.

In the new paradigm low inflation and fiscal stability are necessary but not sufficient conditions for securing employment and growth. The new paradigm recognises other drivers of growth in:

• The pursuit of competition and not just privatisation,
• The importance of public as well as private investment not least in education,
• And the need for sound laws and proper financial supervision as well as liberalisation including a route map sequencing the liberalisation of capital markets.

Indeed the country owned poverty reduction strategies  – imaginatively led by Horst Köhler at the IMF and Jim Wolfensohn at the World Bank – are now correctly focusing on creating the right domestic conditions for investment and have highlighted the contribution of public investment to development in infrastructure, sound laws of contract and legal processes that deter corruption, and an educated and healthy workforce.

The challenge is immense:  while in the last decade foreign direct investment flows across national boundaries, including to and between developing countries, have increased fourfold – dwarfing aid – the poorest and least developed countries languish under a double handicap – insufficient foreign investment and inadequate domestically generated savings, with the result that investment per head is in Africa less than 50 dollars a year.

I believe that in return for developing countries implementing codes and standards, there can and should be a new engagement by business as reliable and long term partners in economic development.

Indeed where developing countries guarantee transparency and proper legal and financial systems that deter corruption, the developed world and business should work together to raise levels of investment.  One way forward is joint investment forums.  These councils would bring public and private sectors together, examine the current barriers to investment and discuss in the light of regional conditions how developing countries can secure higher levels of business investment and take the first steps in the international marketplace through intra-regional trade.

And companies investing in developing countries should seek to answer one of the main fears of anti-globalisation campaigners: that where there is no cross border corporate accountability large companies can often seem more powerful than the elected governments of the countries in which they operate.  One way forward is adopting the OECD international standards of best practice for corporate responsibility and advancing both the global compact – introduced by Kofi Annan in 1999 – and the global reporting initiative under which multinationals assess their impact on developing countries.

Trade

The third building block is progress on trade.  We know that developing countries that are open and trade have seen faster growth rates than closed economies. Indeed it is a matter of record that in the last half century no country has managed to lift itself out of poverty without participating in the global economy.

Full trade liberalisation could lift at least 300 million out of poverty by 2015. Even diminishing by 50 per cent protectionist tariffs in agriculture and in industrial goods and services would boost the worlds yearly income by nearly 400 billion, a boost to growth of 1.4 per cent. And while developing countries would gain the most – an estimated $150 billion a year – all countries and regions stand to benefit.

That is why we strongly welcome the WTO agreement in Doha to launch a new trade round focused on development. And in the next phase we must take forward the agreements to open up trade in agriculture, build the capacity of developing countries to participate more effectively in the negotiations and open up greater access to medicines.

Indeed all developed countries should offer access to all but military products from the least developed countries and by banning export credit guarantees for unproductive expenditure discourage and diminish the diversion to arms expenditure of resources needed for education and health.

Financing development

Progress on trade could be worth 150 billion dollars a year to the poorest countries, three times the development aid they receive today. So in addition to policies for stability and investment, new policies for open trade are fundamental building blocks of the new alliance for progress.

But there cannot be a solution to the urgent problems of poverty the poorest countries face without a fourth reform: a substantial increase in development funds for investment in the very least developed countries.

By insisting on dissociating aid from the award of contracts, gains to anti-poverty programmes can be as high as 25 per cent; more effective in-country use of aid can secure further resources for anti poverty work; and better collaboration among donors – pooling of budgets, monitoring of their use to achieve economies of scale and hence greater cost effectiveness and targeting of aid – can also maximise the efficiency of aid in diminishing poverty.

Most of all we must move from providing short term aid just to compensate for poverty to a higher and more sustainable purpose, that of aid as long term investment to tackle the causes of poverty by promoting growth.

The Zedillo Report, whose authors included several prominent Americans, costed meeting the Millennium Development Goals at a total of $50 billion a year, including $20 billion for anti-poverty programmes and nearly $10 billion for education. To meet this challenge my proposal involves the creation of a new international development trust fund which builds on the existing achievements of the World Bank and the IMF but goes further by seeking to address the sheer lack of investment from which the poorest countries suffer.

From the fund, countries operating the poverty reduction strategies can draw investment support and it might be overseen by a new joint implementation committee of the World Bank, IMF and possibly member countries.  To minimise bureaucracy its resources distributed through the existing mechanisms used in the poverty reduction strategies.

Because we must never return to the unsustainable burdens of debt of the 80s and 90s, the very poorest and most vulnerable countries should receive investment help for poverty reduction in the form primarily of grants to partner their soft IDA loans. All other low income countries should be offered interest free loans.  Some beneficiaries will be countries with millions of poor but today classified as middle income countries. Here assistance should be in the form of interest reduced loans, conditional upon implementing agreed poverty reduction strategies and reforms with a national monitoring process including civil society.

In recent months proposals have been made for new and innovative ways to meet this funding gap – the Tobin Tax, arms tax, an airline fuel tax, IMF special drawing rights.  The European commission is examining the Tobin Tax and we are open to investigating other proposals in addition to our suggested development fund.

But in today’s world every international initiative relies ultimately on approval by national governments and their peoples. And it comes down, in the end, to the duties national governments – especially the richest national governments – recognise and are prepared to discharge.

There are many proposals that have been put forward.  We are open to a discussion of their effectiveness.  But if we are to move with the urgency that the scale of today’s suffering demands, we must each as national governments, be bold and recognize the duties of the richest parts of the developed world to the poorest and least developed parts of the same world.

Through richer countries making a long term commitment of increased resources for development for, say, 30 years and with national governments offering a guarantee, either through callable reserves or appropriate collateral as security, it is possible to lever up these contributions to meet our target for extra funds now.

In this way, each year 50 billions dollars more could be available to the poorest countries for investing in economic development.

These proposals are challenging but they are achievable.

The international community has already made a commitment to raising the level of overseas development assistance to 0.7 per cent of GDP.   And in Britain since 1997 we have increased the aid budget of the Department for International Development to 3.6 billion pounds – a 45 per cent increase by 2004.  And we are committed to making substantial additional progress.

Today I am challenging each country to accept their responsibility to play their part and to go further than they have been prepared to go in the past. And it is right that there now be a full debate in the IMF, World Bank and the United Nations as we prepare for next spring’s Financing for Development Conference at Monterrey.

Conclusion

Marshall’s plan was investment for a purpose for a Europe rebuilt.  He summoned forth a new alliance for prosperity between rich and poor countries that, for his time, played a vital part in winning the peace.

So too today – summoning up the spirit of Marshall – the new plan I suggest for developing countries is investment for a purpose, so that they can play their part in a peaceful world.

By each meeting their obligations for change all can benefit.

First, the obligations on developing countries: to end corruption, put in place stable economic policies, to invite investment, to meet their commitment to community ownership of their poverty reduction strategies and to ensure resources go to fighting poverty including education and health.

Second, the obligations on business to engage with the development challenge and not to walk away, including participating in business investment forums and playing their part in preventing and resolving economic crises.

Third, the obligations on the world community as a whole  – international institutions – to reform systems to ensure greater transparency and openness, to open up trade and the opportunities for faster development and to focus on priorities that meet the international development targets.

Fourth, the obligations on the richest governments to the poorest of the world – our commitment to tackling the inequalities through a substantial and decisive transfer of resources; not aid that entrenches dependency but investment that empowers development – investment money that is, in the truest sense of the world, increasing the capacity of the poorest countries.

A $50 billion a year investment fund that invites applications for health, education and anti poverty work will help build the capacity of the poorest countries to compete and engage. And is the high road to a more just and inclusive global economy.

Our answer to anti-globalisation protestors is that, in the spirit of Marshall, we shall not retreat from globalisation.  Rather, we will advance social justice on a global scale, as today’s global alliance for peace is transformed into tomorrow’s global alliance for prosperity.

Since September 11th, President Bush, your government, your armed forces and your people have led a great and global effort worthy of America’s history and its ideals.

With steadfast resolve we work together to win the war against terrorism.  Now, in the great tradition of Truman, Marshall, and that earlier generation, let us also resolve to fight on after victory. Let us together seize our moment of opportunity to win the peace.

In the words of Victor Hugo:

“The future has many names
For the weak it is unattainable
For the fearful it is unknown
For the bold it is opportunity”

This can be our permanent memorial to those whose lives have been lost – that, in remembrance of them, we build the world anew.

Let it be our generation that takes up the challenge and discharges our duty to remove the scar of poverty and hopelessness from the worlds soul.

Let it be our generation that shows those who suffer in the bleakest places of the world that we can light a candle of hope which, radiating outwards, can cut through the darkness and shame of injustice and emblazen across the world a message of confidence and faith in the future.