Tag: Gordon Brown

Below is the text of the speech made by Gordon Brown, the then Chancellor of the Exchequer, to the Local Government Association Conference held in Harrogate on 4 July 2003.

It is a pleasure for me to join John Prescott in addressing the leaders of our cities, towns and communities across England and Wales; to thank everyone here not just for the work you undertake, the service you give, the good you do and the difference you make, but for your central irreplaceable role in driving forward public service improvements and in bringing to life in our time and in our generation the ethos of public service that builds strong communities in our country.

I want to say today that this partnership between central and local government – which is not a partnership of convenience but, because of the beliefs we share in common, a partnership of principle; this partnership founded on the million acts of service by dedicated public servants; this partnership driven forward today by great challenges that face our country which we can only meet if we face them together.

This partnership that acknowledges not only that 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 depend upon locally provided services but that service delivery for families and communities cannot come from central command and control but requires local initiative and accountability; this partnership is a partnership that I want to see strengthened in a new era of local and national cooperation not just in the social improvement of our country but in the economic development of our communities in the years to come.

So I want to talk today about how the partnership we are achieving in social reform – £57 billion more invested in public services, devolution and flexibility in delivery, the greatest possible focus on choice so that the focus is always on the pupil, the patient, the consumer, the citizen – can be complemented by a partnership for economic prosperity: that builds better infrastructure, that develops new skills, that rewards innovation  and moves each region and locality towards full employment in our country.

To build, in the last six years, a better long-term and strategic partnership between central and local government — moving away from the destructive centralism of the 1980s and early 1990s, years characterised by universal capping, strict limits on borrowing and the poll tax —- and to deliver improved public services, the Government – led by John Prescott – has already:

• Boosted financial support for councils, through real terms increases in revenue and in capital expenditure for four years in a row;
• Matched devolution with greater accountability and with new constitutions for local government following local consultation;
• Increased the freedoms and flexibilities that local authorities have to deliver – including a 75 per cent cut in the number of plans required; reduced ring-fencing; more targeted inspection; a fairer prudential regime for borrowing; and greater freedom to trade;
• And introduced local Public Service Agreements which link resources and greater flexibilities to stretching outcome targets for both national and local priorities – and next year we will launch a second round of local PSAs that will encourage partnership working and local innovation still further, as we take forward the current review on balance of funding.

To enable us to make inspection regimes more proportionate, target support where it is most needed, and identify the small minority of failing Councils in need of tough remedial action, clear and concise information about each Council’s performance across a range of local services is being provided for the first time through the new Comprehensive Performance Assessment.

And to encourage all councils to deliver the best public services, high performing Local Authorities will receive substantial extra freedoms and flexibilities including the removal of both revenue and capital ring fencing; sixty plans reduced to just two required  – the Best Value Performance Plan and a Community Plan; a three year holiday from inspection; and the withdrawal of reserve powers over capping, as a first step towards dispensing with the power to cap altogether.

Alongside these incentives, the new Innovation Forum – a genuine partnership between local and central government – is looking constructively at how Local Authorities can be empowered to provide more locally tailored and high quality services in health, for the elderly, in education and in community safety.  Utilising the expertise and experience of the best Local Authorities to help all Councils do better.

This is our vision of a modern partnership between central and local government to deliver both national ambitions and meet local needs – a new localism where there is flexibility and resources in return for reform and delivery. Local Authorities at the heart of public services, equipped with the freedom they need, and accountable to the communities whose needs they serve.

So let me now set out how – building on the new freedoms and flexibilities we have put in place, local and national government working together –– we can meet our goals of full employment and a prosperous, enterprising economy in every region of our country.

For just as we have learned in these last six years that the social goals – educational opportunity, health reform, public sector improvements, child poverty, helping pensioners – we share cannot be realised in practice without central government devolving power to local communities – and whatever challenges we face from time to time, we must remember that we must always work in partnership – so too our goals of full employment and prosperity for all will not be realised without cooperating together and backing local initiative, local solutions, local needs met by local people in local communities.

And let me just explain how it is because in an increasingly globalised economy a full employment Britain that offers prosperity to all depends on regions and localities able to adapt continuously and quickly to change that there is not just a social and political case but an economic case for each local authority’s involvement – each Councillor’s direct involvement – in the economic development and renewal of our communities and country.

Globalisation describes a world whose very mobility of capital and openness to competition is ushering in a restructuring of industry and services across continents.  And while others compete on low value added, low investment and low skilled work, a country like ours has to compete on ever higher levels of skill and technology.

And I tell you that in the new more open global economy levels of local skills and local innovation will matter as much as levels of national demand, otherwise we will have to compete on ever lower levels of poverty pay.

It is because production need no longer be based where the raw materials or ports are and producers can choose where they wish to locate that the local and regional economies that are the most successful will be the magnets for inward investment, will retain their skilled people, will attract more to join them.

What will separate off the successful high employment, high growth economies from the least successful is the ability to adapt on the ground, continuously and quickly to fast moving technological change, skills needs and demand changes.

Indeed the paradox of globalisation is that it puts more emphasis on the local.

The more we are interdependent, and thus the more our regions face intense global competition, the more successful will be the regions and localities that have the flexibility to adapt to change.

Meeting the challenges of globalisation depends on securing success in meeting the challenges of localisation.

And the whole of the UK suffers, and balanced economic growth becomes impossible, if we have unemployment, emigration and the under-utilisation of potential and resources in the poorer areas and yet congestion, overcrowding and inflationary pressures in the richer.

That is why we seek a British economy:

• Not just founded on monetary and fiscal stability – for in an open economy investment will flow to the stable economies and quickly away from the unstable ones
• But built on high levels of innovation skills and adaptability, one driven forward by rapid responses to change – with a new adaptability and flexibility
• where the local and the regional voice is not only respected but seen as critical to economic success.

The old idea in regional and local economic policy was of help directed from the centre.

The first generation of regional policy, before the war, was essentially ambulance work getting help to high unemployment areas – central government providing first aid.

The second generation in the 1960s and 1970s was based on large capital and tax incentives delivered by the then department of industry and then overseen by Brussels.

Both were inflexible and both were top-down. And both approaches did not do enough to close the gap between the areas of high unemployment and areas of low unemployment.

So the third and new generation of regional economic policy measures seek to strengthen the indigenous sources of growth – local enterprise, local innovation, local infrastructure, local skills and the local labour market – tackle disparities between regions and within them.

And the way forward for each region is local people making more decisions locally about meeting local economic needs.

So I want to put forward a set of proposals today that tackle these disparities and close these gaps so that we move forward together to full employment and higher levels of prosperity in each of our localities – and because the unemployment rate in some local authorities is five per cent higher than in others, we know that we have further to go.

The new drivers of prosperity in a modern economy are: enterprise, innovation, skills, investment and employment.

So in each area we ask ourselves: What more can we do? How we can learn from local government in areas where you are pioneering new approaches as we build a new partnership between central and local government?

Not the old relationship based on patronage or a blame culture. But a genuine partnership. We know the gaps to be filled. Let me give you examples:

Enterprise

First, enterprise. Small business creation rates are more than ten times lower in some Local authority areas than others.

And in Barrow-in-Furness and Wansbeck for example, there are six times fewer businesses per 10,000 population than in some London authorities like Camden and Islington.

But I believe that the gap between Local Authorities is such that we should see this not as a signal for despondency, but a challenge and indeed an opportunity for improvement.

The old idea was that you got full employment from a small number of large companies.

Today, as the paper we are publishing today on the role of Local Authorities in economic development shows, full employment needs a large number of small companies creating jobs.

For every three small businesses creating jobs in the best off areas, there is just one, creating far fewer jobs, in the poorest areas – and as every Councillor knows, fewer businesses means fewer jobs which means reduced income for services and yet more social problems that public services need to fund.

So one of the best pro-jobs, anti-poverty programmes is to help more people start more small businesses, and ensure that access to capital, advice, skills – once restricted only to an elite – is opened up to men and women in every part of Britain.

Some Local Authorities are already striving to achieve these aims.  Councils like Bexley, Eastleigh, Knowsley and Rotherham that have gained beacon status for fostering business growth have seen a real improvement in the numbers of businesses and jobs being created in their area.  Our challenge is to put in place the right environment to enable all localities to achieve these successes.

In the past, with the rigidity of the uniform business rate, Local Authorities gained no direct financial incentive from giving priority to business creation.  In fact Local Authorities could justifiably argue that they had to deal with the social and environmental cost of economic development – in transport congestion, environmental damage and pressure on services like housing and education – but that the financial gains through increased income tax and business rates were passed back to central government.

So to tackle this, the current Local Government Bill will allow Local Authorities to keep a share of the business rate receipts that result from new business creation — creating positive financial incentives for Local Authorities and the wider local community to maximise local economic activity while at the same time avoiding excessive bureaucracy and ensuring fairness between localities.

Today we are publishing the consultation paper on the details of the scheme.   This shows that if our preferred model had been introduced in 2000 then Harrogate District Council would by this year have received an additional £875,000 to spend on local priorities as dictated by local people, Sandwell an additional £5.7 million, Peterborough £7 million more and Stockport an extra £10.5 million.

Based on historical data we estimate that in total as a result of this measure, local authorities could gain up to £1 billion over the next three years — showing that the next stage of our employment and growth strategy for Britain can only succeed with greater initiative and engagement by local areas in improving business creation, job opportunities, skills and innovation.  Further reforms in the Pre Budget Report will reflect this.

So for the first time all of us in partnership can each secure financial benefits from creating new businesses.

And by introducing incentives for every local authority to encourage business creation, we not only put in place the right conditions for job creation but also release more resources for investment in public services.

This measure to give local authorities more resources goes hand in hand with our extra help for areas of greatest deprivation – the emphasis of our approach increasingly on policies to encourage and foster the indigenous skills, talents and potential of local people and communities.

I want people in disadvantaged communities to see that the enterprise culture too often restricted to the elite is open to them – not least in high unemployment communities where prosperity for too long has passed people by.

So we have designated the 2000 most disadvantaged areas in the UK as Enterprise Areas where – working in partnership with Local Authorities and RDAs – we encourage economic activity by cutting the cost of starting up, investing, employing, training and managing the payroll. Here we are bringing together industry, planning, employment and social security policies to tackle local property market, capital market and labour market failures — hence the new community investment tax relief, the power to relax planning regulations, the abolition of stamp duty, the engagement of the new deal – central and local government working together to bring investment, jobs and prosperity to areas that prosperity has still bypassed.

Today we are publishing a paper that shows why we see local authorities as strategic leaders of local economic development and sets out further details on the help available in enterprise areas.  I urge local authorities to use the opportunities presented by these measures to support and strengthen their own local economic and regeneration strategies, and boost the awareness and uptake of incentives by local businesses.

Renewing the local economic base is also one of the main aims behind not only neighbourhood renewal funding in 88 areas worth almost £1.9 billion pounds over this parliament and the new deal for communities in 39 areas worth £2 billion pounds over ten years; but the creation of local strategic partnerships which can do more to drive forward policies on enterprise and employment at the local level.

Innovation

Second, look at innovation. In some areas we spend one tenth – £50 per person – on research and development what we do in others – £500 per person.

While these figures are for regions, they show the gap to be filled. And we know that every successful region and locality must encourage its scientists, its inventors and its innovators – and improve links between its schools, colleges, universities and businesses.

Our regional and local approach means we are already moving from centrally administered r and d policies to the encouragement of local technology transfer between universities and companies and the development of regional clusters of specialisms – encouraging the growth of the knowledge-based company and the business friendly university.

But we can do more to develop new local science and industry partnerships like the north west science council and the Technium schemes in Wales — strengthening links between businesses, universities, regional development agencies and local authorities to support the development of hi-tech industry clusters.   And we have asked Richard Lambert, former editor of the Financial Times, to examine how business-university interaction at the local level can contribute to productivity growth.

Investment

Third, investment. To release new investment I know you want us to remove barriers in the planning system so that together we can better promote local economic development.

At the moment, there is an unacceptably wide variation in the performance of planning authorities.  Over 70 councils are already meeting our target of processing 60 per cent of major planning applications in 13 weeks, but a similar number cannot manage to process 30 per cent of such applications in time.

That is why the government has allocated an extra £170 million to reward faster responses to planning applications — and we will use best value intervention powers to bring change where improvements do not come fast enough.

At the same time we are simplifying the planning guidance we issue to local authorities and the new ‘Planning Policy Statement 4’ on planning for economic development will be issued for consultation later this year.

Alongside our investment of nearly 2.8 billion pounds more in real terms in housing by 2006 and 6.4 billion a year more in transport, we have also made it possible to ensure that what we spend and how we spend on infrastructure improvements is increasingly decided regionally and locally.

With the vast majority of the housing capital budget now devolved, we are moving towards pooling housing spend in regional “pots”, and have created new regional housing boards – bringing together RDAs, local authorities, housing corporations and other relevant bodies to draw up regional housing strategies and make recommendations on funding allocations.  Progressively a greater proportion of funding will be allocated by these boards on the basis of the case local authorities make for local needs rather than on arbitrary formulae handed down by Whitehall.  And the Deputy Prime Minister’s reforms will allow local authorities to mix and match financing and management mechanisms for turning round their housing stock rather than the one size fits all approach.

We are also enabling local people to make local decisions about local needs in transport —– matching local authority control over nearly a third of transport spending – and new powers to raise funds through congestion charging – with a responsibility on councils to produce comprehensive and costed five year transport plans.

So as we move from centrally run housing and transport policies to greater local coordination and flexibility, this major decentralisation is transforming relationships between the centre and localities.

Skills

I come now to skills. Look at the gap between the areas with the most skills and the areas with the least skills. In some local authorities, nearly 100 per cent of 16 year olds are participating in education or training. In others – Salford, Milton Keynes, Harrow – it is less than 70 per cent. Some local authority areas in our country have nearly 65 per cent of 16 year olds with 5 a*-c GCSEs others have less than 30 per cent. Overall across the economy 7 million adults lack basic qualifications. But when some do better we know that all can do better.

The challenge, because we waste too much of the talent of Britain, is to open up opportunities for education to an extent never before seen in this country so that every child, young person and adult will have the best possible chances in life.

And we know we have to look not just at schools but at post-school education. So we are extending the employer training pilots now operating in six areas to around a quarter of the country — offering incentives for firms to give their staff paid time off to train towards basic skills and NVQ level 2.  And a major shake-up in skills training will be announced next week. Building on the new frameworks for regional employment and skills action – in which local authorities are key partners alongside RDAs, the private sector and local learning and skills councils – we are piloting devolved pooled budgets for adult learning in four areas of the country — providing greater incentives to employers and individuals to develop their skills, reducing bureaucracy and strengthening the regional and local dimension in skills development.

And looking to the workforce of the future, we are expanding the modern apprenticeship scheme.

Already, apprenticeships, which a few years ago were dying, have risen in number to 220,000 today.  And our aim is that over a quarter of young people aged between 16 and 22 will take part in the scheme by 2004, with even more benefiting by the end of the decade.

Giving every young person who works hard and tries hard the chance of an apprenticeship or college or university.

Employment

Finally, employment. While some areas of Britain are now full employment areas – where in some council areas unemployment is below 1 per cent – some areas have 6 per cent claimant count unemployment and over 40 per cent of the working age population not in work.

In every area of this country, you as councillors will know at first hand young people who have never worked, long term unemployed men and women who have given up hope, school leavers with no qualifications – no jobs, no cash, no hope – many of whom are now enjoying opportunities for the first time in their lives because of the new deal.

This New Deal initiative has been taken forward by central and local government working together.

And thanks to the efforts of many of you here, 870,000 people have got work through the New Deal so far.

But as long as there is unemployment we will not be complacent – and as local councillors I would like you to play an ever bigger role in the next steps to help the newly redundant get back to work quickly and expand the New Deal to assist those hardest to employ.

We need to make the New Deal more effective and we want to work with you to overcome the barriers to local employment opportunity in your council area and in your region.

Today we find that there are almost 600,000 vacancies in the economy. That there are large numbers of vacancies in each region – almost as many as 2 years ago, and 1 year ago despite the world downturn jobs for people prepared to take them.  The North East which used to have few vacancies today has over 10,000.

And there are not just vacancies in the South East, but in every region

• In Wales nearly 15,000
• In the West Midlands 24,000
• In Scotland over 25,000
• In the North West nearly 30,000

And so the next stage of the New Deal is to do more to link jobs without workers to workers without jobs. So in addition to requiring the long term unemployed in 40 areas of the UK to take jobs on offer,

• Job centres will have local budgets to help with travel, training and equipment to ensure the unemployed can get back to work quickly
• There will be a new ethnic minorities fund and area-based initiatives to tackle the particular barriers facing those who too often miss out on jobs
• And we want to follow the innovative examples of councils like Bristol and Brighton who have tailored supplementary employment programmes to complement the New Deal

For too long too many single parents have been denied work. So in addition to the minimum wage and our new tax credits – raising the in-work income for a lone parent with two children who works full time to £276 a week even after tax – we will pilot an extra £20 a week for those lone parents who voluntarily undertake job search, rising to £40 extra a week for their first year in work.

And with new housing benefit help – delivered in partnership by local authorities – lone parents on a typical rent of £50 a week and working part time will receive at least £213 a week making them far better off working part time than not working at all.

For too long too many young people have fallen through the net.  Some of the hardest to help are young offenders ? 70 per cent of whom re-offend. So the government is now seeing how we can apply nationwide ? under the leadership of Sir John Parker of Transco ? the successful reading training for work programme ? offering young offenders training and work while in prison with, on good behaviour, a job when they are released: a programme with a 78 per cent success rate so far.

For too long too many disabled people have desperately wanted jobs but have lacked the support they needed to move into work.

As a first step for men and women on incapacity benefit who wish to work, there is now an extra £19 a week as the guaranteed minimum income for 35 hours work rises to £194.  We are looking at how improved rehabilitation, capability assessment and training support can help disabled people and those who have suffered ill health fulfil their potential in work. And in the local authority areas where our new pathways to work initiative is being piloted, we want local councils to play a full part – as both service providers and employers – in helping shift the focus on disability from what people cannot do to what they can.

For too long in too many deprived areas of the country there has been a destructive culture that “no-one around here works”.

So we will provide far more help than in the past in these areas, using the sanctions and opportunities available in the New Deal and where necessary taking job advisers onto estates — offering the unemployed training, advice and sometimes cash support to help them get into work, and linking them to jobs in the vicinity, but in return expecting the unemployed to take up the jobs that are available.

Tackling the worst concentrations of unemployment, street by street, estate by estate.

Conclusion

So one by one: enterprise, innovation, investment, skills, employment – we break down the barriers to prosperity with local and central government working closely together.

In other words, a new partnership – with government enabling and empowering rather than directing and controlling and with local authorities building capacity and focusing on improving the prosperity of their localities.

Instead of people looking to Whitehall for solutions in locality after locality, more and more people are themselves taking more control of the decisions that most affect them – a devolution of power that is now ready to spread across regions, local government and communities, large and small.

And as we look to the future, we will strengthen and deepen our dialogue with you to identify those areas where further reform will help you most.    And we will involve you too in our decision on the euro.   The deputy prime minister and I recently issued guidance to local authorities on euro preparations and you now have the opportunity to consult your local communities and develop your own changeover plans.

I agree with Sir Jeremy Beecham that this new localism – effective devolution based upon a genuine partnership between central and local government – moves us forward from an old Britain weakened by centuries of centralisation towards a new Britain strengthened by local centres of initiative, energy and dynamism.

And in this way, I believe that a new era – an age of active citizenship and an enabling state – is now within our grasp —- at its core, a renewal of civic society where the rights to decent services and the responsibilities of citizenship go hand in hand.

But I end where I began. We all know about what brings people into public services – the belief that we can make a difference.

And we know that if – building on the expertise and success that some of the best councils have demonstrated – we can empower local managers and local service deliverers, that ethos of public service – the importance public servants attach to duty, obligation, care and compassion – can, working within the right framework, ensure the best public services in the world.

And as we look now to the future, let us remember not just the challenges ahead but the inspiration that comes from the achievements of the pioneers of local government and civic pride — leaders whose hopes, whose vision, whose ideals inspired a whole generation to greater public service.  Men and women prepared to modernise, to reform, to change, to tear up old ideas and adopt new ones.

They developed a shared vision that remains our vision today: a vision of a just society in which everyone – and not just a few – had a chance to fulfil their potential, in which even in times of hardship people strove to help each other.  A shared vision of a society in which by the strong helping the weak, it made us all stronger.

Never let us lose that ambition for our country and for the communities which we serve. We must never lose the ambition that we can scale new heights, meet new needs, tackle deep-rooted injustices, and work together for a better, stronger society.

That shared ambition that social justice and economic progress can go hand in hand, and that in our Britain everyone has a part to play.

That is the vision I put before you today.

That is our aim.  That is now our task.  That, if we work together, will be our achievement.

Below is the text of the speech made by Gordon Brown, the then Chancellor of the Exchequer, at the City Growth Strategies Forum on 8 October 2013.

It is a pleasure to be here today to celebrate the progress so far of the City Growth Strategy Pilots.

And I want to start by thanking everyone here – regional development agencies, local authorities, public servants, companies, academics, the small business service, urban specialists in every field, and in particular Professor Porter – for the work you do developing strategies for growth which build on indigenous strengths and aim to give every community in Britain the opportunity to realise their economic potential – and congratulate you on what you have done in the last few months in pilot projects in Nottingham, City fringe, Heathrow, St Helen’s, Haringey, Plymouth and London South Central.

When I became Chancellor in 1997 my first act was to make the Bank of England independent.

We acted immediately on coming to office because, with new monetary and then fiscal rules, we wanted to entrench a new culture of economic stability not seen in Britain for decades.

And following the election in 2001, our first act of economic policy was to make the competition authorities fully independent of political interference.

We acted then — and it is time to go further now — because the priority for our second term and the years ahead is to build from the foundation of economic stability a new culture of enterprise which helps open up new markets, breaks from the old corporatism of the past and opens opportunities for enterprise to all.

A British enterprise culture is vital because for fifty years since the war there was no consensus on business and enterprise. The left has been seen as for fairness at the cost of enterprise, the right for enterprise at the cost of fairness.

Yet we know that a pro-competition policy and pro-enterprise regime that encourages entrepreneurship genuinely open to all is a million miles away from the corporatist and anti-competition approach associated with the old left in the post war period

But equally we must move beyond the eighties when, despite the rhetoric, not enough was done to build an enterprise culture. Too often the image of enterprise was of a closed circle with millions left out, and of a regime which talked about competition but left the competition regime largely unreformed, protecting vested interests and stifling economic dynamism.

Instead, what we now want to see is a dynamic business culture which makes people feel that enterprise is not for an elite but potentially for them too.

Indeed in time we can, in my view, forge a new British consensus not just around stability but around an enterprise culture that is open to all, fairness and enterprise advancing together.

So in the next few weeks in the run up to the Pre Budget Report and the Budget I will set out the agenda moving forward so that we can make the most of the new opportunities available.

Enterprise for All

The latest evidence shows that the climate for small business in Britain is still robust.  Small business creation rates are still strong.  Survival rates continue to improve – and even during a global downturn Britain has suffered less than many of our G8 competitors.

But the gap between Britain and the US remains high and we know that there are still too many areas in Britain where enterprise struggles to thrive.

We recognise that the barriers to enterprise are greater in poor communities and that many businesses in our least well off areas face special problems in obtaining access to support, advice and finance.

Our objective is that no-one is left out on the margins, no-one excluded from the mainstream of economic prosperity.

And this is the time – when economic growth is strengthening – to do more to bring prosperity to those places and people the economy has too often and for too long forgotten

In tackling the employment and enterprise problem in the high unemployment areas, we will not return to the old ways which have failed.

Neither an old style benefits approach which ignored the causes of poverty and unemployment – and did not invest in education, training, jobs and business development. Nor a bricks and mortar only approach which, with enterprise zones, targeted subsidies for property development at the expense of help for enterprising local people.

Our way is not the old way of simply backing zones of enterprise and forgetting about the people – it is about backing people of enterprise. For we know that in our inner cities and old industrial areas we need not more benefit offices but more businesses.

Through our national strategy for neighbourhood renewal and our regeneration programmes, high unemployment communities will have extra support to allow enterprise to flourish.

But we need to do more.

Inner cities and established industrial areas should be seen as new markets with competitive advantages – their strategic locations, their often untapped retail markets, and the potential of their workforce. And so we want to put in place the right incentive structure to stimulate business-led growth in our inner cities and estates and encourage much bigger flows of private investment.

Our aim is to make the market more likely to work in places where it wouldn’t otherwise work. To build a network of relationships between the high unemployment areas and the private sector.

That is why we have created Enterprise Areas in the 2000 most deprived wards in the country – where we will give special help with starting up, employing, training, payroll and investment:

• the abolition of stamp duty entirely with full stamp duty exemption for all business property purchases since April 2003;
• new powers for planning authorities that will cut red tape for growing businesses by removing the need for them to apply for planning permission;
• community investment tax relief – which offers for every £100 of private investment an extra £25 of public investment;
• the possibility of enhanced capital allowances for renovating business premises;
• increased funding for the Phoenix Fund – providing support to thousands of small businesses with special help for women and ethnic minorities who face additional barriers to enterprise;
• and financial incentives to help all businesses bring their tax and payroll systems on line.

And now that we have set up a community venture capital fund – the Bridges Fund – with a continuing remit to help fund a regular wave of new businesses, we are investigating the possibility of a second fund which could operate in deprived communities right across the UK.

And just as we are working with local authorities and regional development agencies to develop these enterprise areas – so too we need to make use of the creativity and flexibility that the private sector can bring.

That is why the work of City Growth Strategies is so important – learning from the Initiative for a Competitive Inner City in the United States – harnessing the power of the private sector to generate economic growth – and revitalising seven of the most deprived urban areas in England by identifying their competitive advantages:

• the links to major transport routes that gives St Helens an advantage in the logistics sector;
• the international trade opportunities for Heathrow City that come from its multicultural population and location;
• the opportunities to grow the creative clusters in the City fringe and Haringey;
• the under-supply of shopping facilities that brings opportunities for retail in south central London.

Public and private sector working together to make a real difference in these communities;

• increasing income, wealth and jobs for inner city residents;
• making the inner city a more competitive place for business;
• and creating a positive attitude towards the opportunities for enterprise that these areas have to offer.

Enterprise in Schools

But if we are to truly have the deeper and wider entrepreneurial culture we need, we must start in our schools and colleges.

I want every young person to hear about business and enterprise in school; every college student to be made aware of the opportunities to start and grow a business; every teacher to be able to communicate the virtues and potential of business and enterprise.

Already six hundred thousand 14 to 16 year olds are benefiting from work experience and thirty thousand teachers are in work placements. And we are now working with business and the world of education to build on this, improving the quality of placements and experience.

But this new initiative is not just about work experience but about enterprise and entrepreneurship in the curriculum

At present less than a third – and in some areas less than 15 per cent – of young people have the chance to take part in enterprise activities while at school.  We have announced plans – and money – to give all young people at least 5 days of enterprise education in our schools by 2006.

Conclusion

So this is the time to say to every corporate leader in our country, help us strengthen the enterprise culture by becoming role models for our young.  And take a look at investing in our high unemployment areas. They offer business new choices, new recruits, and new markets. It is good for business and for growth.

In the new Britain we want more enterprise, more investment, better education and preparation for the future in every community.  I want Britain to be a world leader in enterprise – and the opportunities and benefits of enterprise to be shared by all regions and all people.

And with government, business leaders, and local communities working together, I believe we can achieve our goal.

Below is the text of the speech made by Gordon Brown, the then Chancellor of the Exchequer, at the CBI National Conference held in Birmingham on 18 November 2003.

I want to thank all of you here – the wealth creators of Britain – for the contribution you make to Britain’s continued economic growth; for the dynamism that you have shown in meeting and mastering the challenges of a more unstable global economy; and for your commitment to the prosperity of Britain.

And it is a particular pleasure for me that I am joined this morning by someone who has distinguished himself both in business – as the former Chairman and Chief Executive of CSX Corporation – and in government service. And I would ask you to welcome the Treasury Secretary of the United States John Snow.

And I want to say – I believe on behalf of all of us here – in welcoming President Bush’s visit later this week, what binds America and Britain together is not simply a shared history over the generations – and not just wonderfully good and cordial personal relationships – but shared values.

Indeed for centuries, America and Britain have been linked by the ideals that we share: a passion for liberty and opportunity; a belief in the work ethic and in enterprise for all; a commitment to being open not isolationist; and our shared conviction that economic expansion through free trade and free markets is the key to growth and prosperity.

And with shared values we must also meet a shared threat. As Tony Blair said yesterday, it has fallen to this generation –

the generation who were born or grew up at a time when Britain and America had together fought World War Two – what we believed was a war to end all wars; the generation who lived through the uneasy and fragile truce of the Cold War years; who dared to hope that when the Berlin Wall fell the threat of nuclear, chemical and biological weapon proliferation had been removed but now find the world at risk from a new threat; it has fallen to this generation to fight global terrorism and rogue states.

In this new century our shared values across the Atlantic can become our common destiny. And Mr Secretary, I – and all of us here – stand for a Britain – as you stand for an America – that is outward looking, ambitious to succeed, determined to advance an enterprise culture, fully equipped to lead in the new global economy.

And it is as a reflection of these shared values, and a special relationship we are not just celebrating but deepening, that today John and I are able to announce a joint US-UK enterprise agreement – that we believe will make for a stronger relations between America and the whole of Europe.

We know that damaging trade and regulatory disputes between Europe and the USA have hindered commerce and damaged transatlantic relations. It is time now for us all to make the effort to move beyond them. Just as in 1988, when Europe was at the outset of the great project to move towards a single market, the Cecchini report showed the benefits of breaking down barriers for commerce, growth and jobs, so too we have agreed today – alongside our efforts to revive the Doha trade talks – to proceed with a major transatlantic review — an independent study on how by liberalisation, the removal of tariff and non tariff barriers, and agreed approaches to competition and regulation we can reap the benefits – which could be as much as $100 billion and one million jobs – from greater trade and investment between our two continents.

And let me announce also as part of our agreement:

– incentives for our universities to become more entrepreneurial and link up in research and technology with US universities including a technology transfer fund to foster exchange of ideas across the Atlantic;

– enterprise scholarships for management studies not just in the UK but in the USA; sharing best practice on enterprise education in schools and universities, with young entrepreneurs in the US and UK able to learn from each other;

– and a joint forum next year to discuss common productivity challenges and share best practice.

John…thank you…

North America and Britain are the two areas of the industrialised world in which growth has been strengthening most – even amidst one of the G7’s longest and most protracted world downturns in growth and trade.

At various points in the last three years – America, Japan and Germany in 2001; half the euro area and much of Asia in 2003 – our main competitor countries have faced recession.

But, for the first time in fifty years, Britain has not only avoided recession but has continued to grow in quarter after quarter, year after year, in all six years of our government since 1997.

Remember the old days, what was called the British problem: stop go, boom bust, unstable cycles…Britain the country usually first in, worst hit and last out of any world downturn; invariably hit by an inflation problem that prevented interest rates falling when they needed to come down; and usually then by wage inflation that could not be afforded and prevented you making long term investment.

So I want to explain to you today the policy we – and the Bank of England – will continue to pursue to ensure the British economy entrenches our new won and hard won stability and continues to grow – ensuring we take no risks with inflation or stability generally, or with the fiscal position. And because we must never take stability for granted I want to set out some of the measures I propose to take in the Pre Budget Report to lock in that stability for the years to come.

The lessons all advanced economies have learned are that in a global economy, monetary and fiscal policy has now to adjust quickly to fast moving changes and to heightened risks of instability — and to do so it has to be proactive and forward looking. While there is a link between money supply and inflation, in open economies with liberalised capital markets rigid monetary targets just cannot work. But the experience of the 1970s and 80s also taught us that correct as Keynes was to point to the need for proactive and forward looking monetary and fiscal policy – ever more essential in fast moving capital markets – the old way of doing so – crude annual fine tuning – could not work either.

Instead the flexibility and proactive approach a modern economy needs demands a framework – whether monetary or fiscal – based not on short term targets but on clear long term objectives that are met and seen to be met; well understood operational rules of procedure that are painstakingly followed; and an openness and accountability that which helps build public trust and market credibility.

That is why my first acts as Chancellor in 1997 were not only to make the Bank of England independent but to introduce a new British model for monetary and fiscal stability with: instead of monetary targets, a symmetrical inflation target that is as concerned about deflation as it is about inflation instead of the old annual fiscal fine tuning, clearly established fiscal rules set over the cycle
and because it is important not just to build trust but to educate decision-makers about the costs and benefits of different courses of action, an openness and transparency.
And in Britain today our new framework – this British model – has, in most people’s views, made Britain better placed than before to cope with the ups and downs of the economic cycle. Indeed, the experience of other economies has shown that if monetary policy remains sluggish and inflexible – or fiscal policy is still based on the old style annual incrementalism, blind to the economic cycle – then growth has been lower.

So – to entrench stability for the long term – what are the lessons we learn for the future?

First, the importance not just of setting clear and precise objectives and rules of procedure but also a symmetrical inflation target that, with the bank seeking 2.5 per cent inflation, is pro growth as well as pro stability. The credibility that has come from bank independence and the symmetrical inflation target has enabled the Monetary Policy Committee in the difficult world conditions manufacturers and businesses faced to – as in the USA – respond proactively to the recent downturn by aggressively cutting rates —- in Britain’s case nine times since the start of 2001. With the result that, even when more exposed than any European economy to the IT shock, growth continued and unemployment continued to fall.

It is because we are committed to delivering the stability industry needs that the same proactive approach is being pursued as the economy strengthens.

Let us remember that in 1988 as the economy started to accelerate the then government cut interest rates, fuelling an inflation that eventually led to a deep recession. It was from these mistakes that in 1997 we learned: immediately after we came to power we raised interest rates and then even as inflation expectations started to fall the newly independent Bank of England raised interest rates again so that we could ensure a long period of low inflation and sustained growth.

And again in 2003 the Bank of England, determined to keep inflation low and stable in a strengthening economy, have raised interest rates to ensure that Britain continues to enjoy stable growth.

I believe that the MPC is right to take the forward-looking approach of pre-emptive action – taken as the economy strengthens – to lock in stability.

And we will not yield to any inflationary pressures, any unaffordable wage demands or any short term quick fixes or soft options that would risk or squander the huge economic opportunities that our hard won stability offers the British people.

Fiscal discipline matters too. It is where there is no credible long term commitment to fiscal stability over the cycle that economies can find themselves in the perverse position of cutting spending or raising taxes at the wrong time of the economic cycle, putting growth and stability at risk. And it is precisely at this point in the economic cycle that past British governments have made mistakes.

So breaking from the old familiar annual public spending rounds, the old annual promises and breaking of promises over surpluses and deficits, we set long term fiscal rules over the cycle – rather than rigid year to year targets – and these have supported monetary policy in helping us continue to grow.

It is because of this long-term commitment to fiscal stability that:
In 1997 and for two years we froze spending and turned the large deficit that we inherited into a large surplus; we then aggressively cut the national debt; we then paid off more debt in one year than in the whole of the period since the Second World War; and we then were able to reduce debt interest as a share of national income to its lowest in almost a century, since 1914.

Our stability first policy means that our fiscal decisions will ensure that while debt is rising substantially in other countries, levels of debt in Britain will remain low and sustainable. At all times we will meet our fiscal rules and, more than that, in the Pre-Budget Report we will publish our plans showing that after tough decisions made on pensions – state pension spending will rise to 15 per cent of GDP in Germany and France but remain at 5 per cent in Britain – our fiscal position is sustainable over not just a year or two but over the next decades.

So our policy will remain stability first – today, tomorrow and always. For stability is never a final achievement but always a permanent never ending challenge.

And it is upon this foundation of a shared national commitment to stability that we can move to my next ambition: that Britain agree a similar shared commitment to a wider and deeper entrepreneurial culture, a shared commitment across the whole country to enterprise:

– enthusing young people in every school and college with the spirit of enterprise;
– in all parts of our country and particularly in the high unemployment areas, demonstrating that enterprise is a solution to the unemployment and economic challenges we face;
– valuing business leaders as role models in our own communities;
moving beyond the old sterile political divisions so that there is, across the whole country and across the whole political spectrum, a shared purpose in ensuring that British enterprise, inventiveness and creativity can lead as we face our biggest challenge – competing successfully in the global economy – the theme of this Conference.

I know that for most of the companies here, there is hardly a good you produce that is not subject to intense competition from at home and abroad — competition not just from traditional competitors in the advanced industrial economies but competition from emerging market economies not least in Asia and the east of Europe.

I know that because you now operate in a global economy, the decisions you make every day about where you source your products are not just decisions about where to buy them within Britain but where to buy them across the world.

And that because the our labour market is now international, at every point you have to look not just where you source your labour and skills but where your competitor sources labour and skills.

All the ground rules – who you customers are, who your competitors are, where your labour comes from – are changing — and no one is going to turn the clock back.

And I think the whole country owes you – as our business leaders – a debt of gratitude for your response to these new realities —- in particular, your courage to change.

And just as you and your companies must respond and adapt on a continuous basis, so too must government. And for every government across the industrialised world – and we will be hearing from John Snow in a moment – the key question – beyond all the old, sterile political party point scoring – in this era of global competition is, and will be: what is the best contribution that government can make?

I am more than ever convinced that government should concentrate only on what it can do well:

– building a competitive environment;
– investment in skills, science and infrastructure;
– and beyond that getting government out of the way by removing the barriers to enterprise – whether from Europe or Whitehall – that hold you back.

So as we seek, as pro Europeans linked to Europe by history, geography and economics, to build a global Europe — flexible, outward-looking, reforming and open, far from an inward-looking trade bloc – and I am publishing our latest Progress Report on Euro Preparations today — I am proposing to my European Finance Minister colleagues that Europe designates 2004 a year in which we set a clear timetable to eliminate wasteful regulation.

I know that the best contribution pro-Europeans committed to Britain leading in Europe make to the cause of Europe is by ensuring that in Europe we face up to rather than duck the difficult decisions about economic reform. So I can tell you that just as we successfully resisted the savings directive that would have harmonised savings taxes, Britain will resist inflexible barriers being added into directives like the working time directive and agency workers directive, the investment services directive and the transparency directive, as well as tax harmonisation. And I invite you, as companies, to join us in putting European regulations to the ‘costs ‘test, then the ‘jobs’ test and then the “is it really necessary” test.

And at home we will support this by – as Patricia Hewitt has said – removing further audit requirements from more small firms and by making further cuts in the time and cost of VAT administration — and I invite you to nominate from your businesses men and women who will assist us in identifying and sweeping aside old regulations that have outlived their usefulness.

When we raised national insurance to finance a modern reformed health service you told us that we were right to insist on efficiency and value for money as the watchwords for the public services. I have announced the Gershon Review into cutting back central bureaucracy and making more effective use of our front line professionals; and the Lyons Review examining the relocation of 20,000 jobs out of Whitehall. It is by requiring reform as a condition of resources — by measures from more flexible labour markets, modernised NHS foundation hospitals where there is tough inspection and extra freedoms for high performers, and reformed systems of university funding to public sector pay linked to performance, a tough housing inspectorate, and freedom and flexibility for good performing local councils — that we will be able in the next spending round to ensure money is well spent and deliver new resources to our front line public services.

And we will legislate to tackle a long standing obstacle you have rightly raised with us that we make the planning system quicker, more flexible and more responsive to your needs.

I know the priorities of the CBI for investment: central to our economic future is excellence in British science and innovation. So not only will we create new centres of excellence in science teaching, we are investing an extra one and a quarter billion pounds a year to expand the science research infrastructure and training more skilled scientists and engineers, but you have asked us — and we have responded – for an R and D tax credit, on which we continue to consult, and more support for technology transfer.

And because we – Government and CBI – also agree with you that the key to success is getting the best people and the best out of your people, we are also responding to your wish that standards amongst school-leavers must be of a ever rising quality. And with

– the return of apprenticeships – once dying now taken up by one quarter of a million young people
– the new University for Industry – Learn Direct – which has already given nearly 1 million adults the chance to take courses from literacy to language to it
– and the Employer Training Pilots that offer paid time off to train towards relevant skills
– we are investing more today in education and workplace skills than at any time in our history and will continue to do so. And I hope that we can strengthen the skills partnership between business and government to achieve our shared aim: that Britain becomes the best educated, most skilled, most technically proficient workforce in Europe.

You have not only told us the importance you attach to the government investing in science and skills but of proper investment – in partnership with the private sector – in transport and infrastructure. And with the doubling of investment in our roads and railways – an extra £4 billion a year – we will proceed, no matter what the opposition, with our pioneering Public Private Partnerships and these will be extended from transport, schools and hospitals into prisons, urban regeneration, social housing and waste management.

An enterprise economy must be rooted in an enterprise culture starting in our schools and colleges, and extending across every community. And today John Snow and I have been meeting business leaders pioneering enterprise education in our schools and encouraging new start ups in high unemployment communities – as well as local young entrepreneurs from the Birmingham area putting their innovative ideas into practice – and I can assure you that having cut small business tax from 23 pence to 19 pence and exempted the first £10,000 of new company profits from tax, cut long term capital gains tax from 40 pence to 10 pence as well as mainstream corporation tax from 33 pence to 30 pence, we will continue to look with you at the business tax regime so that it can reward entrepreneurship and encourage new investment: an approach based on a broad base and low tax rates that is stable and transparent, reflecting our goal to make and keep the UK as the best place for international business.

So from a stop-go economy, Britain is now one of the world’s most stable and a growing economy – the best position from which to seize the opportunities of a highly competitive global marketplace.

But now its time for Britain – which has created a British model for stability – to build on that and come together to create a stronger enterprising economy.

I believe we can build a shared commitment to enterprise and wealth creation stretching across all communities of our country.

I believe we can create a stronger deeper enterprise culture that will help us take our rightful place in the global economy.

As John Snow can tell us, America has a model of enterprise which we can learn from.

John Snow himself has played a great part – in business and in government – in strengthening that enterprise culture —- and it is my pleasure to introduce him to you.

From John’s time in the US Department of Transport, in business leading CSX Corporation, as the Chair of the Business Roundtable – America’s foremost business policy group – and now as a distinguished Finance Minister, John Snow has been committed to bringing business and commercial expertise to the running of government — and dedicated to a strong pro Atlantic consensus

It is my pleasure and privilege to introduce John Snow and ask him to address this conference.

Ladies and gentlemen, Treasury Secretary of the United States of America, the Honourable John Snow.

Below is the text of the speech made by Gordon Brown, the then Chancellor of the Exchequer, at the Wall Street Journal Conference held at the Four Seasons Hotel in London on 24 November 2003.

Introduction

I am grateful to have the opportunity to address this Wall Street Journal conference.

To have the chance to thank the Wall Street Journal for its contribution to the debate about the future of Europe.

And to have a further opportunity beyond your columns to engage in the most critical debate about the future of Europe – what changes Europe must make to meet the competitive challenges of globalisation.

I want to demonstrate that to be fully equipped for the global economy Europe must become open, outward looking, flexible, competitive and reforming.

To detail the agenda of policy change – in monetary and fiscal policy, liberalisation, employment policy, taxation and trade – that is essential if this is to happen.

And then to show how around such a new, enlarged, reforming Europe a deeper consensus around Europe’s future and Britain’s destiny in Europe can be built – a new consensus that – as Tony Blair and I have both said, Tony Blair most recently at the CBI last Monday – sweeps aside both unacceptable federal assumptions rooted in the past and anti-European prejudices of the present.

Context

It was once said that Europe was divided into two – those in the West who had Europe and those in the East who believed in it. Today East and West are united in one Europe, thus ending centuries of division.  A European Union that started with a desire for a Europe at peace is, with enlargement, entrenching that commitment to peace and seeking to generate prosperity in all parts of Europe. Peace and prosperity remain the central reason why we must make the European Union work well and why I believe as a pro European that Britain – linked by geography, history and economics to Europe – must play a leading role in Europe and in that reform process

But even if enlargement has been the catalyst for the new constitutional debate, there is an economic transformation taking place that is of even greater long term significance than the fifteen becoming twenty five – and that is the impact of globalisation on all of Europe’s nations.

A moment’s reflection will convince that it is globalisation – global flows of capital and global sourcing of products, not least from Asia – that is putting all of Europe under intense and sustained competitive pressure, forcing Europe to change – and change quickly.

The Europe that progressed from coal and steel community to customs union to common market to single market and then to European Union was, in effect, the worlds first modern trade bloc – its advanced internal rules and preferential agreements separating Europe off from the rest of the world.

Understandably the discussion then was how this new trade bloc of Europe could manage its own internal affairs, what institutional arrangements were required, whether a social dimension was needed.  And an assumption became rooted in the very rhetoric of European integration that the single market would lead inevitably – through the single currency – to tax harmonisation, a federal fiscal policy and the completion of a federal state.

But because of the intense pressures that arise from globalisation, Europe is now entering the second stage of its history as a union and is finding that the agenda relevant to its first phase – the era of a trade bloc – is quite different for its second stage – the Europe facing global competition.

Let me give one example of how in the move from trade bloc Europe to global Europe old policies are not just out of date but counterproductive for the global era.

When I first attended European Finance Ministers meetings in 1997 I found that it was simply assumed that tax harmonisation within Europe would happen.

For years for example it had been assumed that to eliminate tax avoidance by for example German citizens failing to pay tax on their savings income in Luxembourg, there should be a harmonisation of taxes on non-domestic savings throughout the European Union. This was a proposition that from the moment we came into power we fought for two reasons: harmonisation of tax would reduce competitiveness and would be unacceptable to the peoples of Europe because decisions on what to tax, and how, reflect national choices and cultures.

In the years after 1997 a detailed proposal was drawn up under which similar tax rates would be levied on savings in Europe under the auspices of the Commission. But when such a plan was finally explored in detail, European leaders found that in an open global economy, where savings could move worldwide, Europe’s savers would respond to a harmonised tax not by bringing their savings back to their country of residence but sending their savings out of Europe altogether to lower taxed countries.  So instead of, for example, Germany receiving tax on its citizens savings in Luxembourg both Germany and Luxembourg would lose these investments to Switzerland and Liechtenstein or non European tax areas like the United States.

It is now obvious that – national cultural factors notwithstanding – it is the very openness of global capital markets that undermines the European Union’s proposals for tax harmonisation and would, if harmonisation was implemented, reduce European competitiveness.

But it is not only rigidities in tax policy that global economic change challenges.

Ministers are coming to recognise that in a global economy it is not only tax barriers but other rigid barriers and inflexibilities that shelter and protect countries and companies from global competition that have to be removed in the interests of competitiveness. Indeed, in every part of the world rigidities, inflexibilities and lack of competitiveness – that could once be sheltered in the era of trade blocs – are now fully exposed in the era of global competition.

The global flows of capital and the global sourcing of products mean that there is hardly a product that is manufactured in Europe does not now have an Asian or American competitor able to exploit their advantages in either low wages or higher productivity.  And even services – that once could be located only close to the customer – can now be run from thousands of miles away, outside Europe.

Indeed Europe’s low growth, its 14 million unemployed, and the productivity gap with the USA…all underline the same challenge: that globalisation forces the European Union to shift from an old often inward-looking trade bloc to a flexible, reforming, open and globally-oriented Europe – able to master the economic challenge from Asia and America.

So the driving force for radical change in Europe is not so much political enlargement as global economics; not so much the 15 becoming 25 but the whole of Europe facing up to global competition. And the agenda that flows from this demands a programme of liberalisation, tax reform, new employment policies, the opening up of trade and commerce and a modern monetary and fiscal regime.

And more than that: the same global pressures that force tax competition and economic reform onto the European agenda also force Europe to rethink the most basic of assumptions that have underlain 50 years of development.

The authors of European integration made two major assumptions: that the nation state would increasingly be too small for the big issues of, first, economic management and second, political identity. And they went on to assume that national economic, political and cultural integration would lead inevitably to European economic, political and cultural integration.

But those who in the 1980s thought that we would move from being economically integrated at a national level to being economically integrated at a European level have been only partially right.  Increasingly, the nation states of Europe have become economically integrated not just at a European but at a global level.  Indeed it is global not European flows of capital; the global, not European, company; and the global, not European, brand that dominate.

And under challenge too – not least because globalisation’s insecurities lead people to cling to old identities – is the second assumption of the old European model – that side by side with growing economic integration from nation states to a European stage would come growing cultural and political integration where national political and cultural identities would be superseded.

In an interdependent world which opens up new opportunities but not necessarily on an even handed basis – and which leaves people anxious and insecure – people are more likely to cling to their national cultural and political identities.  And right across Europe – side by side with new global economic realities – political and cultural identities have remained firmly rooted in the nation state.

It is interesting that just one in ten think of themselves primarily as European, even fewer amongst those due to join the EU over the next few years.  We are Europeans but we are British, French, Polish, German, Dutch, Italian first.

So the debate about Europe’s future and its role in the wider world has to be understood in this context: that the economic reality is no longer – as it was in the 80s – how this or that trade bloc develops on its own but how each continent is part of – and benefits from – globalisation as a whole; and that the political reality remains people’s attachment, for example on issues of what is taxed and by whom, to their national values, their national identities and thus to their nation state.

And with Europe’s intergovernmental conference now entering its final stages, it is important that Europe responds to these new challenges with clarity.  And we must do so without ambiguities that might, if unravelled, undermine even the best of intentions – to the detriment of jobs and economic dynamism.

Economic reform

First, the economic reform programme

Europe will only maximise the benefits of globalisation – and solve its problems of low growth and high unemployment – by becoming more efficient and increasing its productivity – pushing ahead with the necessary structural economic reforms to promote sustainable growth and increase the flexibility of our labour, capital and product markets. This is particularly important for successful economic integration as new entrants seek to catch up with higher rates of growth.

Global Europe must be more aggressive in making sure that in its operation the single market does not shelter inefficient industries but does what it should do: forces them to be more competitive; fosters investment in key areas like R&D and infrastructure; and by encouraging new enterprise – and rewarding it properly – generates the growth, productivity and employment we need.

So having created a single market in theory, we should make it work in reality so we achieve lower prices for the consumer.

Since 1992, the single market has produced a gain equivalent to £4000 pounds for every household in Europe.  Goods now move freely across Europe, whereas before 1992, internal customs borders meant that around 90 million forms were filled in each year, a massive burden on businesses and individuals.  And markets have been opened to the benefit of consumers.  In telecommunications, for example, the average price of calls has dropped since 1996 by around 30 per cent for businesses and 16 per cent for households.

But while the single market encompasses 375 million people today – and will rise to 450 million next year – we have still a long way to go to secure for business and consumers the full benefits in commercial opportunities and consumer prices.

While in 1988 Cecchini estimated that single market liberalisation would add 4.5 per cent to Europe’s GDP, cut prices by 6 per cent and increase employment by 1.75 million, many of the gains have yet to materialise. And the single market is often more honoured in rhetoric than in reality.

And to ensure well informed and open markets that ensure capital flows to productive uses and that labour and capital are used efficiently, we favour:

• Faster progress towards the integration of capital markets;
• Full liberalisation of energy markets by 2007;
• Full market opening of postal services by 2009;
• In aviation, rapid progress towards a fully liberalised EU-US open aviation area and the use of market mechanisms for allocating slots at airports;
• And making the single market a reality for services as well as goods where we must agree the principles of an approach in the next year.

Too often we have depended upon political fixes to make progress in our journey towards a single market.  Too often, the aims of liberalisation and opening markets have resulted instead in increased regulation.  So we need a new model for opening European markets and for removing barriers to competition.

In the UK, we decided that the way forward was that competition authorities, rather than politicians, should make the crucial decisions necessary for opening up markets.

In Europe, we should make the same move.  Rather than political initiatives based on harmonisation, Europe needs competition decisions which make a reality of the single market.  We need a more proactive EU competition regime – with investigations into particular European markets and sectors to drive up competition and prevent British firms from being excluded from markets from energy to telecommunications

A similar proactive approach must be taken to state aid reform.   We must tighten up the rules on the most distortive state aids in order to avoid inefficient subsidies which impose costs on taxpayers and consumers – and prevent full and fair competition.  And we fully support the commission’s efforts to ensure the rules on distortive aids are properly applied in all member states.

But we must also ensure the rules do not prevent measures which help make markets work better.  It took Britain more than a year to secure European permission to create regional venture capital funds for localities desperately in need of strong local capital markets that work for small businesses. And it took months more for permission to abolish stamp duty for business property purchases in areas urgently in need of local property markets that work and the new businesses and jobs that can ensue.

We are ready to work with the Commission and other Member States to develop state aid guidelines which would allow such measures to be approved more quickly in the future.  And we support proposals for a significant impact test to deal quickly and simply with aid which does not have a major effect on trade and competition – and urge the Commission to implement such a measure as soon as possible.

Alongside structural reforms, well-targeted public investment can also play a role in driving long-term growth.  Europe needs to do more to improve planning, management and better design and development of infrastructure projects – and support the development of a more effective partnership between public and private sectors using the efficiencies of private finance initiatives.  Indeed we believe that private finance can be extended from hospitals, schools and transport to prisons, urban regeneration, waste management and housing.

And at the same time, in an increasingly competitive world where investment in R&D is vital to promote both innovation and growth and the gap between our research and development performance and that of Japan and the US is still too wide, Europe must raise R&D investment to move closer to our aspiration of 3 per cent of EU GDP.

Capital markets can and should help us manage risk more efficiently between sectors, over time and across national boundaries. While America has achieved a high degree of diversification across state borders, investment in Europe remains fragmented on national lines and there is a need to remove barriers to diversification of investments across borders, for example in pension and mutual funds.   So we will support the European Financial Services Action Plan as it improves mutual recognition of financial services providers in insurance, banking and capital markets.

And just as greater integration – a common approach to research and development and capital markets – is to our benefit, so too greater subsidiarity in regional policy is the best way forward for Europe. Why? Because while Europe’s money can be best used to supply vital aid to the poorest countries of Europe richer countries need greater freedom to use their own resources to pursue modern, locally-led regional policies.  And we hope that the current review of regional aid will lead to a new regional aid framework before the end of 2004.

It is not enough to ensure that EU funds are spent better, the European Union must also make sure that its own finances are well protected against fraud.  Despite changes introduced since 1997 – including a complete re-write of the budgetary rulebook, a more independent internal audit service and, from 2005, a new, modernised accounting system – the latest report by the court of auditors and the recent allegations of financial wrong-doing at Eurostat suggest that EU funds are still too vulnerable to fraudsters and Europe must introduce further reforms to address these shortcomings.

Tax harmonisation

Second, the same globalisation that demands open, flexible liberalised markets demands more open, flexible and competitive tax systems.

Competition between tax systems exists in the United States of America even where they have not just a single currency but a federal state. So far from the single currency requiring tax harmonisation, it is becoming generally recognised that tax competition is an essential element of the economic reform agenda. It can encourage innovation and thus more efficient ways of raising revenues; can help cut through bureaucracy and reduce compliance costs; and while tax competition must be fair and above board – the UK is working with our international partners to root out unfair and discriminatory tax competition – tax competition allows governments to respond to national preferences on the role, structure and aims of taxation.

If we look round Europe today some countries wish to tax wine and champagne according to their national priorities; others beer and spirits differently; others energy differently; others tobacco. And tax competition recognises that Member States have different preferences that often reflect different long standing national values as well as preferences at any one time, and may also have different preferences for the level of social provision, the size of their public sector and accordingly the required tax take.

So it is right to resist schemes for the harmonisation of corporation tax or further harmonisation of VAT, just as it has been right to support exchange of information as the means to tackle avoidance of savings taxation.

Social dimension

Third, Europe’s founders recognised that markets are social structures and work best when there is an explicit social dimension.

And for its time and era the European social model which argued that enterprise had to be matched by fairness was an advance on responses to industrialisation in many other parts of the world.

But with competitive pressures now global and not just European, the social dimension of a global Europe cannot be one that stops the clock, freeze frames and protects people against change. The social dimension must be one that does not replicate an indefensible status quo but equips people to meet and master change.

Therefore it is right that Europe move from what are often called passive labour market policies to active labour market policies – policies which do not simply pay people to stay out of work but which encourage people to move from welfare to work and give them the skills they need.

So here, and in the treatment of employment legislation, Europe must embrace greater labour market flexibility as the only modern route to full employment and put new regulations to the flexibility test as well as devise new incentives that help the unemployed. And the prize of a modern agenda for a flexible, job creating Europe based on independent states working together is that we are able to answer peoples anxieties about the great insecurities that arise from globalisation.

Take long term unemployment

In France over 30 per cent of unemployed have been unemployed for more than a year, in Germany nearly 50 per cent, in Italy nearly 60 per cent.   On average across the euro area it is 43 per cent but only 8 per cent in the USA. In other words only one in twelve of the unemployed stay unemployed for more than a year in the USA but in Europe nearly half the unemployed are still out of work.

Today 14 million people across the EU are out of work – including more than 15 per cent of young people

So it is clear that the post-war objective set by all countries of high and stable levels of growth and employment cannot be achieved in the old ways: just by maintaining high levels of demand in, essentially, sheltered and protected economies.

Instead there are modern ways to make opportunity count and advance towards full employment that take us beyond the old idea that social cohesion had always to be bought at the cost of enterprise.

Instead of viewing flexibility as the enemy of full employment, we should recognise that the right kind of flexibility in European as well as British labour markets is essential for jobs.

So it is right that in the Wim Kok Employment Taskforce Report, Europe examines how, in the search for higher employment levels, we reform employment services, seek greater local flexibility, ensure social security benefits can encourage the return to employment, and sharpen tax incentives for work. And it is right both to create flexible markets and to equip people to meet and master change – through investment in skills and training, through the best transitional help for people moving between jobs, and through the operation of incentives to work like a minimum wage and a tax credit system, tailored in each member states to national circumstances.

Take the British working tax credit which combines the flexibility of a labour market working smoothly with minimum standards of fairness for every employee returning to work. An unemployed adult on a modest income moving from a higher paid job from which he has been made redundant to a lower paid job recoups through the tax system up to 70 per cent of the wage loss — with the generous British child tax credit making the same true for employees with children whose incomes extend up the income scale. So the tax credit makes possible labour market flexibility – and thus the creation of new jobs – while ensuring there is a minimum below which families cannot fall. Many in the rest of Europe are now examining tax credits.  And by providing a real and effective safety net for people moving jobs or moving into work, the tax credit system helps the flexible creation of jobs.

But regulation should only be used where necessary and the regulatory burden reduced wherever possible.  The impact, cost and benefit of new EU regulation should be considered rigorously before any proposal is adopted – especially regulation which threatens our commitment to more and better jobs.

Here again mutual recognition is a better way forward than harmonisation.

Research suggests that around half of all new regulations now emanate from Brussels.  In particular, Europe must reform existing rules to make it easier for entrepreneurs to start up and grow their businesses, instead of facing the same regulations as large businesses and suffering most from their impact on costs and time.

And as we move forward, we must strengthen our commitment to rigorously assess the impact of all new legislation on the competitiveness of the EU economy, and lessen the burden of existing legislation.

So we will:

• resist the quarterly accounting requirements imposed under the proposed transparency directive;
• call for changes in the Investment Services Directive to prevent the financial services sector facing over-burdensome regulation;
• make sure the Financial Services Action Plan is about reducing red tape and not increasing it;
• and resist inflexible barriers being introduced into the Working Time Directive and Agency Workers Directive.

I am proposing to Finance Minister colleagues that in the year 2004 a European wide push against wasteful regulation forms a central part of our economic reform agenda.

In this new initiative – where I believe there is a willingness of member states to cooperate – I believe the two European Councils – the Dutch Presidency summit of December 2004 and the British Summit of December 2005 – should be summits that sweep aside wasteful regulation

And in the next two years every proposed regulation should be put to the costs test, then the jobs test and then the “is it really necessary” test. Existing regulations should be put to the same tests.

Trade

Fourth, in the old trade bloc economy Europe could worry most about internal trade and least about trade with the rest of the world

It is now trade with the rest of the world that is growing fastest of all

Take investment flows. For fifty years from the 1940 America invested heavily in Europe

In the 1990s it is Europe that is investing heavily in the USA

Indeed for nearly ten years funds invested from Europe in America have exceeded funds invested in Europe by America

Globalisation means that trade is rising nearly twice as fast as output.

And it is obvious that while in the trade bloc era Europe could be protectionist and shelter its goods and services, globalisation forces Europe, like Britain, to be open and outward looking.

It is a long academic debate about the virtues and inefficiencies of trade blocs and the efficiency gains from a more open trading system. What is clear is that warring trade blocs will increasingly seen as not just inefficient but dangerous.

And in a new global environment where all the arguments for the benefits of free and open trade are now more pressing than ever before, but where political resistance is strong, we must stand firm.

So Europe needs to confirm its rejection of the protectionism and parochialism of the past and be open, outward looking and internationalist.

The breakdown of talks in Cancun – where the EU, US, Japan and many developing countries were unwilling to accept the necessary cuts in tariffs and trade-distorting support to reach agreement – is a bitter disappointment and a serious setback to the multilateral process.

There are now real risks that the response to globalisation is not to embrace change by opening up trade but to set our face against change, by becoming more protectionist.

And there is indeed pressure to create greater barriers, pursue bilateral deals, build regional blocs that are inward looking, economic fortresses that resist change.  Talking about free trade but not engaging with the benefits of it.

Any danger of European protectionism – or Japanese or American protectionism – should be resisted.

To present an inward looking “Fortress Europe” – rivals with America in a multi-polar or bipolar world – as the sequel to the nation state and the alternative to the embrace of globalisation would be to miss the major opportunities for prosperity: a failure to recognise the real gains that can come from embracing globalisation and open trade and an unwillingness to make the reforms necessary to equip Europe to benefit.

So to secure the gains from the opening up of trade in the twenty first century we need to take on vested interests in exactly the way Cobden and Bright did in the nineteenth century.

Europe must lead in the World Trade Organisation.

Along with America, the EU should not wait for the Doha development agenda to conclude.  We should start liberalising now and deliver the benefits that such reforms – properly sequenced – would have on growth, consumer prices and developing countries economies.

In particular Europe and America must, sooner or later, come together to tackle, at root, agricultural protectionism which is failing consumers, taxpayers, farmers and the environment, as well as seriously damaging the economies of the world’s poorest countries.

This summer Europe achieved an important step forward, breaking the link between production and subsidy for many products and reducing the trade-distortion impact of the common agricultural policy.

The CAP imposes enormous costs on the EU economy:  at 45 billion euros a year absorbs nearly half the EC budget; member states provide an additional 15 billion euros in support from national budgets; on top of that consumers bear a burden of 50 billion euros through higher food prices.  And agricultural subsidies and protectionism costs developing countries $30 billion a year leaving millions in poverty.

But at the same time as pursuing a multi-lateral agenda, Europe should also recognise that a strong transatlantic economic partnership is critical to long term prosperity

The transatlantic economic relationship now accounts for up to $2.5 trillions of commercial transactions each year, including $500 billions of foreign trade, and provides employment to over 12 million people.

This changes the relationship between Europe and America and it is in the interests of the whole of Europe that we have a strong high growth us economy just as it is in the interests of the USA to have a strong European economy.

So I believe that in the best and most forward looking responses to globalisation, Europe and America see ourselves as partners not rivals — not fortress Europe versus fortress NAFTA, but working together to be beneficiaries of global change and ensure that all continents benefit.

Last spring we submitted to the Commission the results of a new study showing that if we broke down the tariff barriers and the barriers to trade in services between Europe and America Europe could increase employment by 1 million, raise growth by up to 2 per cent in Europe and up to 1 per cent in America.

So Europe should recognise that a strong transatlantic economic partnership is critical to long term prosperity.  It is not just in Britain’s but in Europe’s interest that the EU and USA – with 60 per cent of the world’s output – seek common approaches to competition, liberalise services and capital markets, remove remaining tariffs, reinvigorate the transatlantic business dialogue, and together make multi-lateralism work for developing countries.

And last week the US Treasury Secretary John Snow and I agreed to take this work forward with our European partners – including proceeding with an independent study on how by liberalisation, the removal of tariff and non-tariff barriers, and agreed approaches to competition and regulation we can reap the benefits from greater trade and investment between our two continents.

The prize of being partners not rivals is that each of us – and our trade partners – stand to gain much more from globalisation.

And Europe’s role must not end there.  We also ought to be at the heart of the new relationship between developed and developing countries – especially the poorest African nations.

In the same way that under the Marshall Plan America helped the regeneration of Europe, Europe and America should work together for a new Marshall Plan – the economic development of the poorest countries.  Not just a moral and social imperative, but an economic priority.

Monetary and fiscal policy

Fifth, a Europe serious about meeting global competition should, as Britain has, move beyond the old short-termist approach to monetary and fiscal policy.

The lessons all advanced economies have learned are that in the new global economy, where investors will put a premium on maintaining monetary and fiscal stability, monetary and fiscal policy has now to adjust quickly to fast moving changes and to heightened risks of instability – and to do so it has to be proactive and forward looking

Fixed intermediate monetary targets assume a stable demand for money and therefore a predictable relationship between money and inflation.  But since the 1970s, global capital flows, financial deregulation and changing technology have brought such volatility in the demand for money that across the world money supply targets have proved unworkable.  So domestic policies which held to rigid monetarist targets are exposed by the liberalisation of capital markets.

At the same time, the old inward looking policies which manipulated supply and demand year to year at a national level – best characterised by short term domestic fine tuning – are as out of date as those which have held simply to rigid monetary targets.  The only reason politicians bound themselves to annual surplus or deficit targets was that no one believed that they had the discipline to meet long term fiscal objectives. But a fiscal policy that is not planned over the economic cycle is one that cannot respond to the ups and downs of a fast moving global economy.

Instead, the flexible and proactive approach a modern economy needs demands a framework – whether monetary or fiscal – based not on short term targets but on clear long term objectives that are met and seen to be met; well understood operational rules of procedure that are painstakingly followed; and an openness and transparency that helps build public trust and market credibility.

That is why my first acts as Chancellor in 1997 were not only to make the Bank of England independent but to introduce a new British model for monetary and fiscal stability with:

• Instead of monetary targets, a symmetrical inflation target that is as concerned about deflation as it is about inflation
• Instead of the old annual fiscal fine tuning, clearly established fiscal rules set over the cycle
• And because it is important not just to build trust but to educate decision-makers about the costs and benefits of different courses of action, an openness and transparency.

And it is precisely this kind of monetary and fiscal policy that is most attuned to the news of an open trading global economy.

First, the credibility that has come from independence for the Bank of England and the symmetric target has enabled the monetary policy committee to respond early and decisively  – raising interest rates in 1997, cutting them sharply in 1998 – and again with nine interest rate cuts since the latest global downturn began with the result that, even when more exposed than any European economy to the it shock, growth continued and unemployment continued to fall.

And I believe that the MPC is right to take the forward-looking approach of pre-emptive action – taken as the economy strengthens – to lock in stability.

Second, it is right that the system be open and accountable.

Most instability and high inflation in the past was caused by a breakdown of the consensus in our society on who gets what.  And Britain usually fell into recession after two inflationary bursts – an initial burst of inflation when demand got out of control and then a second burst of inflation when wage negotiators sought to catch up with higher inflation in their pay claims.

So in 1997 we knew that we had to fashion a model for stability that was seen as legitimate and fair and got the balance right between technical expertise and political legitimacy so wage negotiators would believe that the targets set will be met.

This required an open public debate about the target and the value of it being met.  The greater the degree of secrecy the greater the suspicion that the truth is being obscured and the books cooked.  But the greater the degree of transparency – the more information that is published on why decisions are made and the more the safeguards against the manipulation of information – the less likely is it that investors will be suspicious of the government’s intentions.

And that openness needs to be underpinned by accountability and responsibility.  Public trust can be built only on a foundation of credible institutions, clear objectives, and a proper institutional framework.

But, third, it is only within a framework of being long term and rules-based that markets will allow monetary policy to be proactive. This is what we mean when we talk about discretion being possible only when there is a long term discipline or constraint accepted by policy makers.

It is where there is no credible long term commitment to fiscal stability over the cycle that economies can find themselves in the position of cutting spending or raising taxes at the wrong time of the economic cycle, putting growth and stability at risk. And it is precisely at this point in the economic cycle that past British governments have made mistakes.

So in 1997, breaking from the old familiar annual public spending rounds, the old annual promises and breaking of promises over surpluses and deficits, we set long term fiscal rules over the cycle – rather than rigid year to year targets – and these have supported monetary policy in helping us continue to grow.

It is because of this long-term commitment to fiscal stability that:

• In 1997 and for two years we froze spending and turned the large deficit that we inherited into a large surplus;
• We then aggressively cut the national debt;
• We then paid off more debt in one year than in the whole of the period since the Second World War;
• And we then were able to reduce debt interest as a share of national income to its lowest in almost a century, since 1914.
• And our long term fiscal decisions will ensure that while debt is rising substantially in many other countries, levels of debt in Britain will remain low and sustainable.  At all times we will meet our fiscal rules and, more than that, we have examined the sustainability of the public finances over the next 50 years

In the Pre-Budget Report we will publish our plans showing that after tough decisions made on pensions – state pension spending will rise towards 15 per cent of GDP in Germany and France but remain at 5 per cent in Britain – our fiscal position is sustainable over not just a year or two but over the next decades – the necessary timeframe to assess the potential impact of an ageing population on public finances.

So with all the reforms we have already made in Britain, we have – I believe – a sound and credible British model for long term economic stability

Just like Britain, the euro area has been establishing a framework for economic stability.  In parallel with the creation of the independent Monetary Policy Committee of the Bank of England and our new fiscal regime we have seen the creation of the European Central Bank and the evolution of the Stability and Growth Pact.

Overall the euro area has managed to maintain both low inflation and relatively low fiscal deficits even in a period of world instability.  But there has been low growth. So just as we in Britain are examining how we advance, the ECB has been reviewing its monetary policy strategy and the EU has been looking at how the stability and growth pact can work most effectively.

And I believe that Britain, having had to learn from our experience of the 1980s and 90s of stop go policies – and having learnt from Europe and America – has today something distinctive to contribute.

Below is the text of the speech made by Gordon Brown, the then Chancellor of the Exchequer, at the Advancing Enterprise Conference held at the QEII Conference Centre in London on 26 January 2004.

I am very pleased to be able to welcome all of you, distinguished business leaders, to the QE2 centre this morning.  And let me begin by saying what I firmly believe: that the whole country owes you a debt of gratitude for the way, particularly throughout the world downturn of the last few years, you have been meeting the new challenges of the global economy – challenges that have required resilience, fresh thinking and the courage to change.

Today, leaders of business and government come together in one room to discuss the future.  And I am delighted that we are all here together to discuss how best we can advance enterprise and equip ourselves for the next challenges of the global economy.

It is the first time this Treasury has done anything like this.

So why, you might ask, have we done so today?

I wanted this get together because we all know that in the modern global economy Britain has to meet competitive challenges that are more fearsome than ever, but that the opportunities for the winners are greater than ever.

I believe that if this country is to achieve its full potential, government and business must work constructively and creatively together.

Through this exchange of ideas – with often different points of view – and through seeking the broadest harmony, our aim is to forge a shared and long term national economic purpose for Britain.

A shared purpose that recognises that wealth creation is, today, even more important to the society we want to build; and that if we have the strength to make the hard long term choices, Britain is uniquely well placed to become one of the strongest, most successful enterprise centres of the world.

So let me thank you for joining this discussion here today – friends from the business community, neighbouring governments, international guests – all of you distinguished in your own fields… all of you with powerful influence on the world economy.

So what are the facts this Monday morning that should both focus our attention and drive us forward?

We all know that the new global economy means speed in innovation – it took nearly forty years for the first 50 million people to own a radio, just 16 years for the first 50 million people to own a PC, but just 5 years for the first 50 million to be on the internet.

But it also means a shift in global production.  In 1980 less than a tenth of manufacturing exports came from developing countries.  Today it’s 25 per cent: in twenty years time 50 per cent.  That’s not just cars and computers but half of all the world’s manufacturing exports coming from developing countries.

By 2015 up to 5 million American and European jobs could have moved offshore – outsourced to countries like India and China as they strive to become the world’s second and third largest economies.  Indeed even today China’s significance to the global economy is that every year it, on its own, is adding as much output as the whole of the G7 put together.

And so for companies like yourselves, there is hardly a product or increasingly a service you produce that is not subject to global competition.  And at every point you have to look not just where round the world you source not just your materials but your labour and skills, but where your competitors source their labour and skills.

For Britain this means recognising there is no escape from uncompetitiveness by resorting to loss making subsidies, artificial barriers or protectionist shelters.  Indeed, the price of failure is not a long period of slow decline but sectors going under altogether.  And the opportunity for us is that as low cost, low value production comes under increasing pressure, the continuing challenge of finding and exploiting the high valued added, high tech, high skilled, science-driven products and services is the key to wealth creation in the future.

Here in the Treasury we have been thinking hard about all this.  And I believe that Britain ought to be well placed in this new world.

In this world of open, global competition, we – Britain – are the nation that not only pioneered free trade, the very idea of open competition, but have a greater global reach across all continents than any other.  With our long history of international engagement, our network of contacts – enhanced by the English language, the language of the internet and business everywhere – extends wider and deeper around the world than any other country.

And we have not just a long tradition of inventiveness and creativity – a tradition that gave us the steam engine, the telephone, penicillin and the television and made Britain the world’s leading industrial power – but since 1945 it is British inventors that have given us the internet, magnetic resonance imaging, the human genome project – all starting from Britain – affirming both our potential as a scientific nation for the future and the need to continue to invest in British science.

And we know we will only succeed if we can build on these inherent strengths and if politicians take the hard decisions making the tough long-term choices that are needed.

When it was clear that decades of stop go had held Britain back, that stability was the essential precondition for Britain to be the success it could be Tony Blair and I took the decision to forswear the power of politicians to manipulate interest rates for short term political advantage and make the Bank of England independent.

This was not an easy decision to persuade other fellow politicians to take.

But its importance is greater than ever in a world of ever more rapid financial flows where investors will gravitate to those countries where there is greater stability and away from those countries that do not deliver it.

And in Britain today, our new monetary and fiscal framework, this British model we have created – decisions we had to take to make the Bank of England independent, impose a symmetrical inflation target, cut debt and entrench tough fiscal rules – has made us better placed than before to cope with the ups and downs of the economic cycle.  So instead of being – as in previous downturns – first in, worst hit and last out of any world downturn, Britain has not only avoided recession but has continued to grow in quarter after quarter, year after year, in all six years of our Government since 1997. And we are not just one of the only major industrialised countries to have avoided recession but have been more stable than any of our neighbours over the last few years.

We will never take stability for granted and I can say categorically to investors everywhere that we will continue to steer a course of stability and support our monetary authorities in the difficult decisions they have to take.  And we will entrench not relax our fiscal discipline.

At this stage in the economic and political cycle governments have resorted to short termism in fiscal policy and gone on to raise the rate of spending.

But I am determined not to go down the short term road: I have announced that while meeting all our commitments and our fiscal rules the rate of spending growth in the next spending round will be lower than in this round – at all times I am determined that we will avoid the short termism and mistaken monetary and fiscal policies of the past.

And we will entrench this newly won and hard won stability and continue to demonstrate the same willingness to take the hard decisions so we can build on our strengths.

Now it is precisely these British qualities – our global reach, our scientific genius and now our stability – that are the vital assets for winning in a more harshly competitive global economy. And it upon this foundation that I believe we now have a unique opportunity to build the next crucial and decisive ingredient for future British success – a shared commitment to enterprise and wealth creation, and a determination to remove, one by one, all the barriers in its way.

We will take the tough long term decisions that are necessary to drive this through.

Just as with Bank of England independence we will take the long term view – take on political vested interests – and persuade the British people that everything they cherish about this country can only be built on the bedrock of a flourishing culture of enterprise and achievement.

And each session of this conference will focus on both specific barriers that can be removed and opportunities that can be seized so that we do better on flexibility and economic reform, on trade, on skills, on science, and have a stronger and deeper enterprise culture right across our country.

In the first session we want to learn what the imperatives and choices are for making a successful global company for the future.  The job of government is to do only what it needs to do, no more than what it needs to do – stability, a competitive environment, investment in science skills and infrastructure.

And at every stage – whether for companies starting up, investing, hiring, training, seeking equity, exporting – our aim is to be on businesses’ side.  And learning from US flexibilities, remove all the old barriers holding the enterprising back.

Let me give a few examples:

Planning: Britain must make our planning laws quicker, more flexible and more responsive – and we will.

Pay: Britain must and will do more to encourage local and regional pay flexibility.

Competition: we have just about the most open competition regime in the world.

Transport: we must work with you – private and public sectors together – to tackle the massive backlog in infrastructure investment.

Tax: Britain must do more to reward and encourage investment – and we will.  Just as we have already made our choice and cut long term capital gains tax from 40 pence to 10 pence, small business tax from 23 pence to 19 pence and corporation tax from 33 pence to 30 pence, I promise we will continue to look with you at the business tax regime so that we provide incentives for investment in wealth creation and greater rewards for success – and make and keep the UK as the best place for international business.

Most of all in the coming spending round a government focused on the global economic challenge must make hard choices – as we will do tomorrow on university finance – to make investment in science and skills a central priority because they are the investments where government can make a difference and are most vital to our future.

Every one of you here who runs a company knows that you must draw on the potential of everyone in your company to be successful; its no different for a country.

Through Learn Direct, Employer Training Pilots, Union Learning Funds and then the return of apprenticeships, over 1 million more adults are learning today than six years ago.  But I want us to be the best educated and best trained workforce and tomorrow’s much-needed reform of university finance – which I urge all Labour MPs to support – is another vital step towards that goal.

Our reforms will extend opportunity and equip young people with the skills to meet the demands of the 21st century and they deserve the support of all who share our goal of securing for Britain world class universities now and in the future.

And I also commit us to taking, in this spending round, the tough decisions necessary, demanding, in return for investment, the highest standards in our schools and further education colleges; reforming university finance to secure for Britain world class universities now and in the future; working with you to – both of us – invest in employee training… all the time encouraging and incentivising a work-your-way-up ethos of self improvement and self reliance among British employees.

And in science all the measures we are taking: £1.25 billion a year invested in renewing Britain’s science base; R&D tax credits; science learning centres; investing in science teaching in our schools; and what I can announce today – our commitment to make a long term plan for science funding over the next decade a central feature of our 2004 spending review… are for one purpose: to make Britain the best location for research and development and for innovation.

The flexibility we need is not just in Britain but in Europe too – and I am very pleased that we will be joined later this morning by some of my European Finance Minister colleagues.  The best contribution we pro-Europeans can make to the cause of Europe is by ensuring that in Europe we face up to rather than duck the difficult decisions about economic reform — resisting the kind of inflexibility being added into directives like the working time directive, the agency workers directive, the investment services directive and the transparency directive, as well as insisting on tax competition not tax harmonisation.

And I can tell you that the Irish, Dutch, British and Luxembourg Finance Ministers are today setting out our joint initiative to reduce the burden of existing regulation and to ensure that every new regulation is subject to strict and stringent tests for its impact on enterprise and on the competitiveness of the European economy.

To ensure that enterprise takes centre stage in the drive for economic reform in Europe, the British, French and German governments are also setting out today our proposals for more pro enterprise pro innovation policies in the European Union.

Better trading relationships with the US and the rest of the world help not hinder Europe.  So we welcome the restarting of the Transatlantic Business Dialogue.  We must do more to reopen the world trade talks by tackling agricultural protectionism.  And we propose a review to study – and then strive to secure – the removal of tariff and non-tariff barriers between Europe and America and to agree approaches to competition and regulation.

Finally – a government on the side of enterprise must build a deeper and wider entrepreneurial culture – where starting and growing a business is open to all with ideas and ambition.

Our proposals on enterprise for this year each add up to something bigger than their individual parts – initiatives that taken together can make a difference, and contribute to a change in culture and attitudes by valuing and celebrating the spirit of enterprise throughout Britain:

• We will hold the first ever national Enterprise Week – focused on inspiring the young to be enterprising – in November 2004;
• The Queen and other members of the Royal Family will be visiting the most outstanding examples of enterprise in each region on July 14th;
• In addition to the Queen’s Award for Enterprise, the Government is in discussions with the Palace about new ways of rewarding outstanding individual contributions to the development and promotion of enterprise in our country;
• Young entrepreneurs from Britain will meet and learn from young US entrepreneurs;
• All pupils before they leave school will have the opportunity to enjoy not just work experience but enterprise education too;
• We will launch a new National Council for Graduate Entrepreneurship;
• There will be an annual British competition for the British town or city of enterprise;
• And just as we compete for a European City of Culture we propose a competition for the European City of Enterprise too;
• A joint US-UK Forum on Enterprise – which I hope some of you will attend – this summer;
• In our high unemployment areas 2000 new enterprise areas as zones for new business opportunities with fast track planning, community investment tax relief, the abolition of stamp duty, and the prospect of enhanced capital allowances for renovating business premises.  And we have promised Local Authorities who create new businesses in their areas a share of the increase in national business rate as a reward for their enterprise.

But all of this tells us that building an enterprise culture doesn’t just depend on any one initiative or individual but on changes in attitude and outlook which will, in time, transform our culture.

In other words: advancing enterprise depends upon the efforts of all of us.

I’ve sketched out what I think are elements of our shared economic purpose for a global era:

A Britain that is open, outward looking, flexible, reforming, valuing science skills and enterprise;

Government effective where it has to be effective – in economic stability, science, skills, infrastructure;

Businesses able to be the wealth creators they are, and encouraged where it matters – with incentives and rewards to invest and grow;

And a long term shared economic purpose – by that I mean a long term commitment not ever to take the easy way out or the short term course but resolute to get things right for the long term: making Britain a better place to do business – and better still in five, ten, fifteen, twenty years time from now.

Below is the text of the speech made by Gordon Brown, the then Prime Minister, at Labour HQ in May 2010.

On the back of our party cards it says: By the strength of our common endeavour we achieve more together than we do alone.

And in constituency after constituency despite all odds we proved that again and again on Thursday night.  By the strength of our common endeavour we achieved more together than any of us ever have done on our own.

And so I am here to thank every member of Labour’s staff, every volunteer, every member, every supporter for what you have done in the past, and what I know you will do in the future.

To thank also Harriet, Douglas, Peter, Ray Collins, the Chair of our NEC Ann Black, and our candidates and campaigners.

We know – more certainly now than ever before – that there is a strong progressive majority in Britain.

I wish more than I can possibly say that I could have mobilised that majority to carry the election– but I could not.

And so now I have to accept – and indeed assert – personal responsibility. The fault is mine, and I will carry it alone.

So to give this party I love the best possible chance to prepare for its future, I have resigned the leadership of the Labour Party with immediate effect.

I wish my successor in that role well; and I will stand by Labour’s new leader, whoever that may be — loyally and without equivocation.

Because one thing will not change: I am Labour, and Labour I will always be.

Let me a few days after our election thank those who never gave up and never gave in, who fought so hard and whose dignity in defeat makes us so proud.

In the past few weeks, our Labour Party has shown, even when up against the odds, what we are made of.

Of course we went into this election massively outspent and with, shall I call it, a difficult media environment. In the most difficult of circumstances after an economic crisis a political expenses crisis and after 13 years in government it is to your enduring credit that we denied our opposition the majority they took for granted.

And you know better than anybody how hard fought this election was, and how dependent we were on the small, well disciplined team of which you were such a crucial part. Strong policy, robust research, creative communications and inspired new media work were allied with the most targeted and the most commanding ground war I have seen in my whole time in politics.  And for all that, I thank you.

And I’m proud to say that we proved last Thursday that committed people matter more than limitless cash.

Sarah and I will never be able to thank you enough for what you have done. But I hope when you look back on these times you will tell your children, and your children’s children, about the Britain we built together and the good that we did in this campaign.

Because let me tell you what it was really all about. Last week when I was out knocking on people’s doors … and this wasn’t recorded on tape … I met a girl who was exactly the same age as the Labour government. Born on the 1st of may 1997, she had grown to know and love a Britain with Sure Start, with one to one tuition, with the expectation that every person from every background will have the chance to get on and not just get by.

She took opportunity for granted, and we fought for the chance for every child to be born in a Britain like that. We fought for the future.

And we continue to fight unceasingly because progress is not a word we just speak but a reality we have been creating where the ambit of opportunity always expands and never contracts. And we fight for progress because we know the energy and talent of the British people are boundless whenever they are released from stereotype and allowed to soar.

We know that progressive change is possible, because our very record shows it is.

The minimum wage.

Sure Start.

The child tax credit.

The shortest waiting times in NHS history.

Record exam results in schools.

More police officers than ever.

Half a million children out of poverty.

And two million more jobs than in 1997.

And on top of everything we did to change Britain for the better and forever, we can be proud that there are people alive in Africa today, children in school there who have access to health care there, because of what we have done here thousands of miles away.

So when this think of these times think on the lives saved and changed, and always remember – that New Labour’s achievements do not belong to me or to Tony Blair, but to you.

We fought and will continue to fight for our public services –  services that are not something that we conjure up on our own– or that most of us can pay for by ourselves – but services that are valued because they and the realization of a true nobility that sees beyond selfish individualism, on to what can be done through our collective endeavour.

That is why we fought – and why we together we will keep fighting for justice.

So tell your children you were a part of this – but also never to stop believing that people of courage and conviction can lift our country and make it equal to its best ideals.

So to those who gave their hearts, their hard work and their votes to labour, i say thank you. I will never forget how we stood together – in happier days and through the hardest hours.

And so as you fight on, know that I will be with you, heart and soul.

And know that you have my undying gratitude, because you have given the best of yourselves to the greatest of causes. And because you have fought every hour of every day you will be able to say for the rest of your days;

I was there.

I was on the progressive side of history.

And you are part of a Labour Party which is and will always be the greatest fighting force for fairness our country has ever seen.

We are irrepressible: we fight for fairness, and tomorrow we fight on.

Below is the text of the speech made by Gordon Brown, the then Prime Minister, before the 2010 General Election.

In the history of each nation there are moments of clear decision. Moments when paths are chosen and decisions made that impact not only the months or years to come, but shape the whole course of the decades that follow. So it was in 1997. And so it is today, in 2010.

In the dawn of this new decade, Britain faces the biggest choice for a generation. It is a choice about whether we want to continue on the road to economic recovery or want to turn off, whether we believe that we can face the biggest challenges with the strength of a community around us, or whether every individual should simply be left to sink or swim.

The choice is real, the risks are real, and let us be clear, the consequences are real.

If we get it wrong, we face what they themselves call an age of austerity. If we get it right, we can achieve an age of shared prosperity.

The economy is more central and the choice more serious in this election than any time in my lifetime.

That is why top of Labour’s pledges to the people is economic recovery.

When people ask what are my top three priorities for the country let me tell them – keeping on the road to recovery, keeping on the road to recovery, keeping on the road to recovery.

A sharp right turn off that road would risk your job, your home, your savings.

Securing the economic recovery or wrecking it – that is the choice the country will face in the weeks ahead.

Elections are choices for the future. And so I now pledge myself and my party to fighting each and every day for a fairer future for the people of Britain, a future in which the many and not just the few have the chance to earn a better life for themselves and their children.

We will always put the British people first – before personal interest, our party interest, or any vested interest. We will renew this nation – not for our own benefit or the benefit of a narrow section or clique – but for all the people of this country we love.

We are the people’s party – and we are pledged to serve the people. Today I am announcing the five pledges on which we will fight this election. Each is substantial, deliverable and carefully costed. If you will support us, we will:

– Secure the recovery and halve the deficit through economic growth, fair taxes and cuts to lower priority spending.

We pledge that we will:

–  Raise family living standards, by keeping mortgage rates as low as possible, by increasing tax credits for families with young children, by providing new help for first-time buyers and by restoring the link between the state pension and earnings from 2012.

We will:

– Build a high tech economy, by supporting businesses and industry to create 1 million more skilled jobs and modernising our infrastructure with high-speed rail, a green investment bank and broadband access for all.

We will:

– Protect frontline investment in policing, schools, childcare and the NHS with a new guarantee of cancer test results within a week.

And we will:

– Strengthen fairness in communities through an Australian style points-based system to control immigration, through guaranteed education, apprenticeships and jobs for young people; and through a crack down on anti-social behaviour.

I know that in this time of cynicism and lack of trust in politics, there are some people who will say that politicians will promise the earth but never deliver, that a pledge isn’t worth the paper it is written on.

And I understand that, but these are not general pledges without dates, without tests, without scrutiny. these are our pledges to every single citizen, tied to timetables, regular reporting and proof of performance.

So I want to build-in accountability mechanisms to the pledges we are making, so that you can hold me to account, and we can test our progress against our promises in the year to come.

I believe the business of government should be more business-like – that the British people are the boss and like any employer they deserve to know about the performance of their team.

And so I am proposing the following.

Firstly, Sir Tim Berners Lee, the man most associated with the invention of the internet, is the government’s advisor on data openness and transparency all across the internet.

In the months to come he will be ensuring that there is the maximum possible information available to the public at all times.

This rapid extension of transparency will show in real time how government are delivering against our pledges.

Secondly, I will set out a clear and public annual contract for each new Cabinet Minister, detailing what I expect them and their department to deliver to the British people, and that their continued appointment is dependent on their delivery just as it would be in a business or any other organisation.

Thirdly, I will require the Cabinet Secretary to performance manage the Permanent Secretary of each department against their delivery of pledges and other priorities as set out in the letter of appointment.

Because to be in Government is an honour – and if it is extended to us once again I am not prepared to waste a single second. We have big plans for this country – and we intend to see them through.

We have already laid the foundations for a better fairer future in this week’s Budget for growth and jobs – a Labour Budget with progressive priorities. If you want to know who and what we stand for, just look at what Alastair announced;

– We’re extending the young person’s guarantee, to ensure that young people continue to be guaranteed a job, training or working experience if they can’t find work within six months

– We’re funding 20,000 extra undergraduate places on courses starting this year

– We are investing in Britain’s 21st century infrastructure by creating a green investment bank that will support low-carbon projects

– We are offering first time buyers a two year stamp duty holiday on transactions up to £250,000

– From next month we will make additional payments of £100 into the child trust fund accounts of disabled children

– And we will bring in a weekly increase in the basic state pension of £2.40 from next month, bringing greater comfort to 12 million older people

That’s the difference with Labour – that’s the change we choose. So never doubt that you can build a fairer future. Never doubt we can lift this country and make it equal to its best ideals.

Some will say that we should give up on such high ambitions, that the times to build a fair society are gone and now there’s nothing great that we can do. But 65 years ago, in the aftermath of war, our Labour Party stood before the British people and asked for a mandate to build a National Health Service.

And what is the lesson of those days? Let others resign themselves to small ambitions – we the Labour Party have never believed that difficult times should mean diminished dreams.

Caution says it is too difficult. But we are not cautious but resolute – because our party is the greatest force for fairness our country has ever seen.

Fear says it is beyond our reach. But we are not afraid but bold – because our party will show the people that we are the greatest force for fairness our country has ever seen.

Cynicism about politics says they’re all the same. But we are not cynical – we are energized – because our party will prove again that we are the greatest force for fairness our country has ever seen.

Resignation says ‘they’ve had their time’. But Labour can never resign our ideals to fate we mark out a path ahead – we fight and we win whatever the odds because our party is and will always be the greatest force for fairness our country has ever seen.

We will prove it again and again because our whole history tells us never to believe that injustice is forever woven into the fabric of our lives, never to believe that fairness is a dream beyond our grasp, never to doubt the British people’s desire for decency.

So let the message go out from Nottingham – we may be the underdog but we are the people’s party and we never give up.

And remember in the next few weeks, every step forward we make. Every advance we achieve. Every family whose aspirations we can meet is a victory not just for us, but for that fundamental desire for decency of the British people.

Every time we change a life we change the world, we’ve done it before, and we will do it again.

We are fighting for Britain’s future – and we intend to win.

Below is the text of the speech made by Gordon Brown, the then Prime Minister, to the Welsh Labour Party conference on 27th February 2010.

Thank you friends – and let me say today that our thoughts and prayers are with the people of Chile who have suffered their country’s worst earthquake in 50 years. The people of Chile are in agony today, and Britain stands ready to help.

And friends I wanted to talk about what we’ve achieved together – a Labour-led Welsh administration working with a Labour Government – a partnership that has changed Wales for the better and forever.

You should be proud of the pioneering Proact and React jobs investments that have saved and created thousands of jobs.

And for children and families, a nursery and early learning revolution that is transforming thousands of children’s lives.

For school children, the largest ever school modernisation programme in the history of our country.

For Welsh teenagers and adults a modern skills for work strategy a million miles away from the so called youth opportunities of the Tory years.

For young couples starting out, funds to deliver more than 6000 affordable homes.

For travel throughout Wales, new investment in our railways and in the Ebbw Vale railway line – a key line connecting our communities, closed under the Tories and re-opened with Labour.

And for our older heroes – Welsh Labour made Wales the first nation of the UK to offer free bus travel for pensioners.

In so many ways Labour Wales has led and had a huge an impact on the world – thinking of others and not just ourselves… And so let me also congratulate you on becoming the very first Fairtrade nation on our planet.

So today we’re talking about major Labour achievements, great social advances. Even in spite of a global recession and the difficulties we have faced, we’ve had thirteen years of progress – and let us say that what we have built together with the people of Wales we will never now let the Conservatives destroy.

You know there is one symbol the people of Wales have chosen to demonstrate how you are building the future.

Every time a new baby is born in Wales you plant a new tree to celebrate that birth.

And in planting a new tree you are not only protecting the environment for them and for the generation to come, you are sending a message about the future, that every single child should be able to grow and thrive and realise their potential to the full.

That’s what I love about Wales, that with the greatest traditions of community inspiring us from the past, you are a nation that is always thinking of the future.

And so today I want to talk to you about the big choices we face for the future. I want to talk about the jobs of the future, the industries of the future and the public services of the future.

I want to talk about the future we can win if we make the right choices, and what we all stand to lose if we make the wrong ones.

And let me say our first economic priority, our second economic priority, and our third economic priority for our country remains as it has always been – jobs, jobs, jobs.

Why? Because I know like you that every redundancy is a personal tragedy. Every lost job is an aspiration destroyed. Every business closure is someone’s dream in ruins.

So we must never allow a return to the years of the Conservative Government – uncaring, unfair, years of mass unemployment and lost hope.

Our shared concern about the tragedies of unemployment arises from our background and our values.

Like so many here I come from a family whose grandfather went without work during much of the 1930s.

A grandfather whose small savings gave his son, my father, the chance of an education, the first in our family to go to university.

And the lesson of those days is that even in the worst of times families helped each other, supported each other, came to the aid of each other through thousands of acts of friendship caring and support. And that reveals the most important lesson of all; that it’s not markets that create morals: morals spring from the compassion of our hearts.

In the last two years in the face of the worst global financial recession seen since the 1930’s we have had to make some of the biggest and most difficult decisions. But that’s what leadership is all about.

We had a choice – to take control of failing banks and to nationalise Northern Rock or to take the Tory view, to reject on ideological grounds the very idea of public ownership.

And what happened? The savings of ordinary families were protected not by default but by a decision made by a Labour Government on behalf of, and with the support of, the British people – and in the face of the ideological opposition of the Conservative Party.

We had a choice to do what the Conservatives said and ‘let the recession take its course’.

Or to help 17,000 businesses in Wales and 300,000 businesses across the United Kingdom to get the cash flow they needed.

That didn’t happen by chance; it happened by choice our choice – the choice of a Labour Government.

And then we had another decision; to leave the unemployed at the mercy of market forces or to support jobs and young people into work and training and ensure that 1.7 million more people are in work than if the experience of the last recession had been repeated.

So let’s be proud; of jobs protected not by accident but by our actions, actions a Labour Government took on behalf of and with the support of the British people – and in the face of the ideological opposition of the Conservative Party.

And then we had another choice – to help 300,000 families with advice and assistance with their mortgages so they can stay in the homes they worked so hard to buy.

And that meant people’s homes saved not by chance – but by our choice – the choice of a Labour Government on behalf of and with the support of the British people – and in the face of the ideological opposition of the Conservative Party.

At each turning point our opponents would have made the wrong decision.

But for us doing nothing was simply not an option, because, for us, unemployment is not a price worth paying.

And now we have a choice in the coming days.

The Conservative Party always opposed the fiscal stimulus; they want to cut now the support we are giving to jobs, homes and businesses.

A few days ago they said they want to tear up the 2010 budget, impose deep cuts immediately and accused us of moral cowardice for not doing so.

Of course, typically of them, they called for big cuts before they called for small cuts before they called for modest cuts before they called for big cuts yet again.

So their biggest claim to be the party of change is that they are the Party that keeps changing their minds.

But I say: the consistent truth is that just as public investment has been the only way to move the economy out of recession and just as we have in place a four year deficit reduction plan to halve the deficit in the years to come, public investment must be maintained throughout 2010 until the road to recovery is assured.

And so I tell you: we will not put at risk the recovery and the jobs, the businesses and the homes of thousands of people who would be the direct victims of immediate Conservative cuts coming at the worst possible time.

And now from today there is an even bigger choice the country now faces for times to come – how we create the jobs of the future – how we can secure our shared prosperity and prevent the unemployment that every Conservative Government has brought.

In the 1980s and the 1990s here in Wales and around the UK we marched for jobs, we rallied for jobs, we petitioned for jobs.

And then we got into Government and we set about creating and supporting jobs. And now we have to work hard again for the new jobs for the future.

In 1997 employment in Wales was 1 million 200,000 men and women in work the latest estimate is almost 1.3 million men and women in work –

That’s despite the recession nearly 100,000 more people in jobs than when we first came to office.

Nearly 100,000 more men and women in work than in 1997. Nearly 100,000 more families that have the chance of prosperity they didn’t have. That’s nearly 100,000 people more able to contribute not just to their families but to the community.

And because every redundancy and period of unemployment is a matter of regret for me, I want us to do even better in the months to come.

That’s why I propose a new UK industrial policy to signal the creation across the country of 1.5 million skilled new jobs for the future.

Wales is leading the world in biotechnology with already a cluster of 250 companies.

Here at the institute of life sciences at Swansea University Wales is, with IBM, a world research hub for life sciences – with its world beating supercomputer dedicated to life science research.

And unlike the Conservatives we believe in and will push forward an industrial partnership between business, universities and Government to create over the next decade 100,000 new UK jobs. That means jobs with Labour, jobs at risk with the Conservatives.

And let me also congratulate Bangor University’s School of Chemistry for yet another world leading role from Wales – a plan to eradicate a disease which has killed millions – Wales leading the global fight against the scourge of tuberculosis.

And let us be proud that Wales is one of the countries leading the world with new jobs in energy – the UK pioneer for hydrogen energy, with the hydrogen engine test facility – and now the hydrogen highway, creating green jobs and companies to boost the low carbon economy. And while the Tories opposed the investment we made during the recession to help low carbon industries I can assure you that we will continue to invest in the green economy which can create another 400,000 future jobs.

And Wales can lead in broadband and digital too. Because while the Tories oppose the funding we are putting in place, a Labour Government can ensure that no business in Wales and no family in Wales is denied the chance to benefit from the digital revolution.

And let us be most proud of all that Wales is leading in the advanced manufacturing we need for the future.

And let us congratulate Airbus and the Labour-led Welsh Assembly on securing one of the biggest groups of apprentices on a single site in the country – young people in North Wales, working with Airbus to create the products of tomorrow.

That shows just what young people can do.

So never again should someone’s potential be lost before their lives have really begun. Never again should their talent be written off. Never again should their contribution be lost.

And that’s why, for the first time, we are putting in law young people’s rights to an apprenticeship and ensuring that an apprenticeship place is available for every suitably qualified young person by 2013. And thanks to Labour the minimum apprentice wage has just risen by more than 20 percent.

In total we will have spent five billion pounds creating jobs and helping millions of people into them and we will continue support for young people even as we cut the budget deficit in more than half in the next four years.

And it is because we are so determined to cut the deficit that we have already introduced tax changes and announced not only efficiency drives but cuts in some areas.

Because we have never shied away from tough choices and we never will.

And so I’m here to tell you that the Labour Party – our Government – has a strategy for prosperity – not just for the few, not for some, but for all. And even in the hard times we have not been deflected.

And so today let me say this to the British people; if each and every person who can find work is prepared to take it, then I am prepared to do what it takes to secure not only Britain’s recovery, but to advance further and faster to the full employment of our ambitions.

But let me also be clear; Labour’s focus on employment means precisely that. It means everyone who can work should work.

Because there’s nothing progressive about allowing people to languish on benefits while their talents go to waste. And there’s nothing left of centre about denying to some people the pride, the rewards and the worth of work.

That’s why we have told every young person who is offered work through our Future Jobs Fund that they will lose their benefit if they refuse a job. That’s why we have reformed the incapacity system so its no longer about what people cannot do but what people can.

And that’s why we have told benefit cheats that if they scam the system, they will face immediate penalties.

If young people don’t want to work, there will be no free passes. But for all those who are willing, you have a Government on your side.

And so let us reassert in this time and in this place – that the recession has not weakened but strengthened our resolve to create jobs, that Labour has not deserted our historic goal for employment, but we are redoubling our efforts to achieve it. And that this fragile global recovery is not a reason to change tack but the reason to stay the course.

And so today I feel compelled to warn you about the risk the Tories pose. The risk to the recovery, the risk to frontline services and yes, the risk to jobs. The risk to fairness.

I said last week that people should take a long hard look at the Conservatives. And now the time has come for some simple straightforward questions about the risks that they pose to our country and to our economy.

Because when they talk about change, just ask them a simple question: why they cannot tell you just weeks before their promised emergency budget which front line services they plan to cut this year, how many thousands of jobs are at risk and how much they would endanger the recovery.

And when they talk about change, ask them why they can find that £200,000 for each of these 3,000 richest estates in our country but they are this year proposing to take tax credits away from over a million families.

And when they talk about change, ask them why they say they can’t afford to guarantee front line police on our streets at the same time as undermining all the efforts we are making to close down tax havens.

Ask them why when times are hard for families they wanted an end in Wales to free bus passes for the elderly and free prescriptions.

Ask them why they want to isolate Britain on the fringe of Europe and work with only the most extreme right wing parties.

Ask them why they want to keep the hereditary principle in the House of Lords.

And ask them if they are the party of change why their highest priority at a time like this is to bring back fox hunting.

And you know – after their slogan was announced today, I really think we ought to ask them. How they can claim to be the party of change when these policies –defending the lords, backing fox hunting, designing inheritance tax cuts, are not exactly new but the very policies that have defined the Conservative Party for a hundred years.

Friends, in their policy of change for change’s sake, change that would take us backwards, they would risk our recovery, risk our frontline public services, and risk our country’s future.

They call themselves progressive Conservatives but what they offer is not a manifesto but a masquerade. Not a vote for change that would take us forwards but take us backwards. For they would make the wrong changes, at the wrong time, for the wrong reasons, to benefit the wrong people.

And let us be in no doubt; they are not the party of change for families but the party that would short-change families.

Child Tax Credits – Labour achievement. Tory target. But we will not let them do this to our families.

The Child Trust Fund – Labour achievement. Tory target. But we will not let them do this to our children.

21st century schools for a 21st century education – Labour achievement. Tory target. But we will not let them do this to our young people.

A Children’s Centre in every community – Labour achievement. Tory target. But we will not them do this to our future.

The Social Chapter which helped deliver maternity, paternity and flexible working rights – Labour achievement. Tory target. But we will not let them do that to our rights.

If the Tories were ever to trick the British people and win the election we would see in a matter of months a generation of achievements starting to be wiped out.

A hard won economic recovery put at risk.

The NHS we have rebuilt in danger.

The education of our children under threat.

But I say again; we will not let them do this to our country.

Because here in Wales the soul of our party is in the soil of these hills and in the toil of generations.

People who cared about each other, who reached out to each other, who in times of trouble sought to lift each other, who in times of prosperity sought to share with each other.

People who not only believed but proved that there is such a thing a society.

People who had coal dust on their faces but never lost their visions of a decent society.

And from these valleys, with your own experience of the inequalities and indignities of 1930s health care – of nurses having to leave the bed of their patients to run charity flag days for vital life-saving hospital equipment – men and women went on to create what people once thought impossible: a National Health Service, the greatest act of compassion our country has seen.

And over six decades what these visionary Welsh men and women achieved was not the sixty years mistake a prominent Tory called the NHS, but sixty year liberation for every single family in this country.

And their journey – through all the successes and the setbacks, in the happiest and in the hardest of days – their journey teaches us, we who have inherited their vision.

Never to give up.

Never to give in.

Always to hold to our ideals.

Always to fight for a future fair for all.

And so I ask you today: will you join me in the fight for fairness?

Let us carry this fight all across Wales and all across the country.

And when people ask if we can win that fight in 2010, I say:

We can. We must. And we will.

Below is the text of the speech made by Gordon Brown, the then Prime Minister, on 26th March 2010.

As we emerge from recession, we face fundamental questions about the kind of Britain we want to build for the future; and about who will lead us there.

Choices: about who’s best for jobs? Who’s best for industry? Who’s best for the NHS, schools and public services?

Decisions about the changes we must make this year that will lead us to a better tomorrow.

And we need to ask: who has the plan not just to secure recovery – but to go for growth? The plan that will mean not just jobs for us today – but jobs for our children tomorrow? The plan that will see British business not just succeeding in the global marketplace of this generation – but leading in the global industries of the next?

This week’s budget will set out the next stage of our plan to go for growth.

It is built on two essential pillars.

First, given the fragility of the economy both here and across the world, and the continuing weakness of the global financial system, the essential requirement today is to do everything possible to nurture and secure the recovery and put Britain back on a solid course for strong and balanced growth.

Second, once that recovery is secured – and the private sector is once again strong enough to drive the upturn without exceptional support from the Government – we must carefully but decisively bring public borrowing back down fairly and without damaging front line public services.

Our strategy for growth is not at the expense of the tough deficit reduction plan we have set out; rather it is absolutely central to it. Because it is growth that creates jobs, stimulates demand and brings in revenue.

We know that the strong and balanced growth that we need will not materialise if we simply do nothing, stand back and leave it all to unbridled market dogma. If we have learnt one thing from the global recession of the last two years, it is that unfettered and unregulated markets cannot by themselves be relied upon to deliver a fair future for all of our citizens.

Instead of a gamble on crude laissez faire economic theories we need a new industrial strategy for this country founded on an open partnership of business, people and government – doing all we can to support enterprise as the engine of economic growth and unleashing the entrepreneurial, innovative and dynamic talents we have in Britain.

Encouraging those sectors in which Britain has – or can build – a global advantage; so Britain can truly lead the world.

It means where necessary, investing now to provide the conditions in which private enterprise in these sectors can thrive.

Sectors such as advanced manufacturing, clean energy, high speed rail, pharmaceuticals, science and research; and of course the digital industries – on which I want to focus my remarks this morning.

I want us to consider today the Britain of 2020 – the Britain we can create at the leading edge of these knowledge industries, but also a Britain which leads the world in open, personal, interactive public services and in the new politics.

I want to make a radical set of proposals which include transfers and shifts in existing spending, including being prepared to cancel current projects, and which – together with more detailed plans set out by the Chancellor in the budget on Wednesday – will help us to save billions of pounds a year in public sector costs in the next few years.

I want Britain to be the world leader in the digital economy which will create over a quarter of a million skilled jobs by 2020; the world leader in public service delivery where we can give the greatest possible voice and choice to citizens, parents patients and consumers; and the world leader in the new politics where that voice for feedback and deliberative decisions can transform the way we make local and national policies and decisions.

Underpinning the digital transformation that we are likely to see over the coming decade is the creation of the next generation of the web – what is called the semantic web, or the web of linked data.

This next generation web is a simple concept, but I believe it has the potential to be just as revolutionary – just as disruptive to existing business and organisational models – as the web was itself, moving us from a web of managing documents and files to a web of managing data and information – and thus opening up the possibility of by-passing current digital bottlenecks and getting direct answers to direct requests for data and information.

It will change fundamentally the way we conduct business – with new enterprises by-passing traditional media communications and governmental organisations: new enterprises spun off from the new data, information and knowledge that flows more freely.

And in both the content and delivery of public services the next stage of the web will transform the ability of citizens to tailor the services they need to their requirements, to feedback constantly on their success, to interact with the professionals who deliver them and to put the citizen not the public servant in control.

Today I can announce the first funding for the next stage of this research – £30m to support the creation of a new institute, the institute of web science – based here in Britain and working with government and British business to realise the social and economic benefits of advances in the web.

It will assemble the best of world scientists and researchers and be headed by Sir Tim Berners Lee, the British inventor of the world wide web – and the leading web science expert Professor Nigel Shadbolt.

This will help place the UK at the cutting edge of research on the semantic web and other emerging web and internet technologies, and ensure that government is taking the right funding decisions to position the UK as a world leader. And we will invite universities and private sector web developers and companies to join this collaborative project.

So building on this next generation web and the radical opening up of information and data – and therefore more power in people’s hands – the steps towards achieving this ambition to become the leader in the next stage of the digital revolution are three-fold:

First to digitalise – to make Britain the leading superfast broadband digital power creating 100 per cent access to every home;

Second to personalise – seizing the opportunities for voice and choice in our public services by opening up data and using the power of digital technology to transform the way citizens interact with government;

Third to economise – in the Pre-Budget Report we set out our determination to find £11 billion of savings by driving up operational efficiency, much of it enabled by the increased transparency and reduced costs made available by new technology.

On Wednesday the Chancellor will set out more detailed plans for delivering these savings, totalling, overall, £20 billion.

But over the period ahead I want to go much further in harnessing the power of technology to refashion the structures and workings of government – delivering efficiencies not simply in the back room; but also looking at how the new technologies can open the door to a reinvention of the core policy-making processes and towards a renewal of politics itself.

Let me address each of these stages in more detail.

Britain is uniquely equipped to lead the digital age. We are already an international hub for creativity and commerce. We have the most lucrative e-commerce market in Europe.

And more than a quarter of our jobs – 7 million – are already in information, communications and technology related roles – a higher proportion than in France, Germany or America.

This country has always been at its best when it has led the world in its pursuit of creativity and innovation and in the promotion of fairness and liberty. And in so many ways these issues have come together in the extraordinary development of the world wide web.

It is already creating formidable new businesses and transforming the way existing businesses operate. From online shopping and banking to checking train times or booking flights. From catching up with the news to staying in touch with our family and friends – the web has already profoundly changed the way many of us go about our daily lives.

And it’s not just about convenience – it’s about quality of life too.

The other day I heard how one of Britain’s leading musicians, who spends most of his time abroad, reads his young son a bedtime story from thousands of miles away using Skype. And millions of us can now spend more time with our families because technology allows people to work easily from home.

And although hard to imagine, the revolution we have witnessed so far is only just beginning. The next stage will be radical expansion and enhancement of two-way communication between service providers and homes that new superfast broadband is beginning to make possible.

The Google smart meters programme delivers real time information on home energy use to mobiles and office desktops, helping people to manage energy consumption when they are out – and so save money.

And it could soon be commonplace for children to continue learning together after the school bell has rung by studying in virtual classrooms; and for doctors to hold video consultations from their surgeries with patients at home to diagnose and in some cases even treat them.

The internet revolution is quite literally creating a different world.

But just imagine if you weren’t part of that world.

Imagine if you had never accessed the Internet.

Imagine if you had no access to the best deals on the virtual high street – that can save you on average £560 a year by shopping and paying bills online.

Well that is reality for around one in five adults in the UK. 21% of UK adults have never accessed the internet. That’s over a fifth trapped in a second tier of citizenship, denied what I increasingly think of as a fundamental freedom in the modern world: to be part of the internet and technology revolution.

This is unfair, economically inefficient and wholly unacceptable.

Consider the advent of electricity. How acceptable would it have been to say that only some people should have access to electricity?

Superfast broadband is the electricity of the digital age. And I believe it must be for all – not just for some.

We have already decided to commit public funding to ensure existing broadband reaches nearly every household in Britain by 2012.

Now government must decide what action it will take to bring about universal access to the next generation of superfast broadband, simultaneously ensuring the highest quality content is available online and available to all.

The choice with broadband infrastructure is clear. We can allow unbridled market forces to provide a solution on its own terms and according to its own timetable as others would do.

The result would be superfast broadband coverage determined not even by need or social justice, or by the national interest but by profitability alone. This would open a lasting, pervasive and damaging new digital divide.

It would allow the country to become split between a fast-track and a slow-track to the future, between those fortunate to live in densely-populated areas and those not.

But to concede a willingness to have superfast broadband reserved for some rather than for all also betrays a total failure to grasp the scale of the educational, economic and social opportunities that it brings.

Because the truth is that a government that is prepared to allow a digital divide to grow would be one that creates a deeper and more pernicious divide than simply one of accessing e-mail or online shopping services.

Faster broadband speeds will bring new, cheaper, more personalised and more effective public services to people; it will bring games and entertainment options with new levels of sophistication; it will make accessing goods and services immeasurably easier; it will enrich our democracy by giving people new ways of communicating complaining and challenging vested interests.

In short, the world available to those with superfast broadband will be unimaginably richer than to those without.

So one vision for digital Britain would create two nations: one digitally privileged, one digitally deprived.

And this will mean a massive penalty in economic development to those who are denied access because of a failure of government to rise to the challenge where markets may fail.

The alternative is our vision: ensuring, not simply hoping for, universal coverage.

We say that Britain’s digital future – must be a future for all – not just for some. But if every household is to benefit, then it is fair that every household contributes to meeting this goal.

That is why we have chosen to raise a small levy on each household phone line – 50p per month, about the price of a pint of milk – to help fund a partnership with the private sector for a superfast broadband network right across Britain.

Building a universal fast-speed digital infrastructure is necessary but not sufficient.

High quality content – whether it is news, entertainment, games, networking sites or information services – relies on maintaining the conditions for innovation and competition online.

So in addition to the measures in our digital economy bill, I say clearly today, we will support the independence of Ofcom to ensure creativity, diversity and high standards. And we will retain the BBC licence fee to ensure a strong, independent BBC remains at the forefront of providing world-class quality content across different media.

So we are:

– Investing now in bringing superfast broadband and new technology to all;

– Creating the right environment for innovation and competition in the digital sector; and

– Leading the next generation of the web and internet.

But now we must use this technology to open up data with the aim of providing every citizen in Britain with true ownership and accountability over the services they demand from government.

And in doing so we can put in place the best most personalised but universally accessible digital public services in the world, and harness the power of technology to economise – shaking up Whitehall and making us the most efficient, open and responsive government in the world.

Building on the outstanding work Sir Tim and Nigel Shadbolt who have been leading on ‘making public data public’, I can now announce that we are determined to go further in breaking down the walled garden of government, using technology and information to provide greater transparency on the workings of Whitehall and give everyone more say over the services they receive.

In January we launched data.gov.uk, a single, easy-to-use website to access public data. And even in the short space of time since then, the interest this initiative has attracted – globally – has been very striking. The site already has more than three thousand data sets available – and more are being added all the time. And in the past month the Office for National Statistics has opened up access for web developers to over two billion data items right down to local neighbourhood level.

The Department for Transport and the transport industry are today making available the core reference datasets that contain the precise names and co-ordinates of all 350 thousand bus stops, railway stations and airports in Britain.

Public transport timetables and real-time running information is currently owned by the operating companies. But we will work to free it up – and from today we will make it a condition of future franchises that this data will be made freely available.

And following the strong support in our recent consultation, I can confirm that from 1st April, we will be making a substantial package of information held by ordnance survey freely available to the public, without restrictions on re-use. Further details on the package and government’s response to the consultation will be published by the end of March.

And I can also tell you today that in the autumn the Government will publish online an inventory of all non-personal datasets held by departments and arms-length bodies – a “domesday book” for the 21st century.

The programme will be managed by the National Archives and it will be overseen by a new open data board which will report on the first edition of the new domesday book by April next year. The Government will then produce its detailed proposals including how this work can be extended to the wider public sector.

To inform the continuing development of making public data public, the National Archives will produce a consultation paper on a definition of the “public task” for public data, to be published later this year.

The new domesday book will for the first time allow the public to access in one place information on each set of data including its size, source, format, content, timeliness, cost and quality. And there will be an expectation that departments will release each of these datasets, or account publicly for why they are not doing so.

Any business or individual will be free to embed this public data in their own websites, and to use it in creative ways within their own applications.

For example, Jobcentre Plus now offers a job search widget which can be put on any other website and a similar application for mobile phones.

And independent developers are using the information we’ve published for innovative new websites and mobile phone applications such as ‘asborometer’ – built by one person in just five days. It finds your position using GPS and tells you how many people have been served with an asbo in that area. When it launched last month it was the number one free application in the iTunes store after a reported 80,000 downloads in two days.

We’re determined that government websites should be efficient and meet people’s needs – easy to find, easy to use, and fully accessible. And in our relentless drive to improve the efficiency and effectiveness of the way we use websites to meet this goal, we have already closed 900 now unnecessary government websites, with plans to close nearly 500 more. And we will set new challenging standards of quality and accountability for government websites – including a requirement that each one allows feedback and engagement with citizens themselves.  From today no new website will be allowed unless it fully meets these requirements.

Six years ago we launched Directgov, as the first version of a joined-up view of government on the web.

It now has 25 million visits a month, offering in one place a single portal of information for all citizens on all our public services. And by the end of May, developers will be able to use content from the Directgov website – for example, to translate it into another language, to rearrange it so that it is more relevant for a specific local community, to alert people when it changes, or to let people create their own personal tailored view of Directgov.

But we need to go much further.

So our goal is to replace this first generation of e-government with a much more interactive second generation form of digital engagement which we are calling Mygov.

Companies that use technology to interact with their users are positioning themselves for the future, and government must do likewise.  Mygov marks the end of the one-size-fits-all, man-from-the-ministry-knows-best approach to public services.

Mygov will constitute a radical new model for how public services will be delivered and for how citizens engage with government – making interaction with government as easy as internet banking or online shopping. This open, personalised platform will allow us to deliver universal services that are also tailored to the needs of each individual; to move from top-down, monolithic websites broadcasting public service information in the hope that the people who need help will find it – to government on demand.

And rather than civil servants being the sole authors and editors, we will unleash data and content to the community to turn into applications that meet genuine needs. This does not require large-scale government IT Infrastructure; the ‘open source’ technology that will make it happen is freely available. All that is required is the will and willingness of the centre to give up control.

This bold new approach will transform the way services are delivered but, more importantly, it will be the vehicle through which citizens will come to control the services that are so important to their lives and communities. With Mygov, citizens will be in control – choosing the content relevant to them and determining their level of engagement. And their feedback will in turn help us to improve services.

With the rapid development of technology consumers today expect so much more – but when it comes to government they don’t always seem to get it. With Mygov they will.

Today you can book and pay for a holiday online in minutes. Why can’t you do that for a blue badge for a disabled person? With Mygov you will.

You can deal with your bank when and where you want, at any time that suits you. Why can’t you do that with your Jobcentre? With Mygov you will.

These days websites tell you what other services or products might interest you. Why don’t government websites do that? With Mygov they will.

And recognising the frustrations of having to prove ID in different ways to access different services, we have launched the access to public services initiative to provide a shared service across government, allowing users of government services to identify themselves simply and definitively, and to access those services online.

Online, Mygov will give people a simple “dashboard” to manage their pensions, tax credits or child benefits; pay their council tax; fix their doctors or hospital appointment and control their own treatment; apply for the schools of their choice and communicate with their children’s teachers; or get a new passport or driving licence – all available when and where they need it.

And it’s not just about gains for citizens either. Businesses can benefit too. By the end of the year, all public service contracts over 20 thousand pounds will be available on a single, free, easy-to-use online portal, and the data will be available free of charge for others to re-use.

To help us realise this vision I am delighted that Martha Lane Fox has agreed to broaden her current role to become the UK’s digital champion and help us establish in the cabinet office – at the heart of government – a new digital public services unit.

The unit will be charged with ensuring that departments achieve rapid progress on transferring and transforming services to online channels.

It will ensure those services are designed around the needs of those who use them most.

And it will put the 4 million people who are among the heaviest users of government services – but who have never used the internet – at the heart of our strategy rather than letting them literally slip through the digital net.

Increasingly the digital net will be the social safety net – the only way to extend access to new, higher quality and more efficient digital services, to all of our citizens.

Pricewaterhousecoopers has estimated that the Government can save £900 million a year just by bringing those who don’t have access to the internet online so that they can carry out transactions with public services more quickly and efficiently.

We know that for every transaction with a public service that is done online rather than over the telephone we can save around £3.30 in administration and staffing costs.  And using the internet rather than filling in paper forms or writing letters can typically save £12 each time.

But the total savings would be far bigger if all public services could be accessed online.

So I want the new unit to act as a dynamic force for change within government helping to quickly drive significant cost savings with radically increased digital public service delivery.

But this drive to economise must go further than the delivery of public services – for the coming second digital revolution also offers the opportunity to radically refashion government and Whitehall departments.

A restructuring that means we become the most efficient, open and responsive government in the world. A reform that should allow us to make major savings on running costs – while providing better services to the citizen.

Traditionally Whitehall departments have in varying proportions comprised three main elements. First, policy teams including people who oversee or regulate front-line delivery agencies. Second, a set of public-facing, often transactional services. And third, a series of back office functions essentially supporting the other two.

The power of the new digital technology now gives us the chance to transform this model: to make Whitehall and the wider public sector more efficient and more effective.

Every industry has felt the force of the internet’s ability to empower consumers and increase transparency. Now is our opportunity to be one of the world’s leading governments addressing these challenges – to oversee an enormous shift from what many have in the past seen  as  a  too  paternalistic, closed Whitehall to an open, interactive responsive enabler  where citizens personalise shape and ultimately control their services.

I have already set out how I believe Mygov can transform the nature and cost of the Government’s public facing services.  But the same is potentially true of the other two core civil service functions.

Take the back office. The Government is committed to achieving £4bn of savings from back office functions by 2012-13. To drive this ambitious programme forward, we intend to establish a number of business service companies that will handle the routine back office functions of Whitehall departments.

The prototype for this new approach already exists – the shared services centre in the department for work and pensions, which already supports 140,000 staff in three departments and plans to take on four more in the next year. DWP also has plans to establish its shared services as a trading fund within the next twelve months, and will explore in parallel the scope for bringing further commercial expertise into its work.

Our aim and intention is that these public business service companies will use modern digital platforms wherever possible, and aim to be leaders in green technology and working practices. And as they demonstrate progress there is no reason why these companies should not in time draw in private capital, giving rise to the possibility of substantial capital receipts.

I believe that a similar approach can also be used to drive down the Government’s property costs. Significant efficiency improvements have been made over recent years and overall costs are now £740 million a year lower in real terms than in 2003.

But operating costs can still be reduced further. We have committed to save £5 billion per year in running costs and dispose of £20 billion surplus property over the next decade.  To achieve this we will look to create a number of specialist government held property vehicles run on commercial lines.

But the impact of technology on central government should not be confined to the back office and transactional services. We have within our grasp the opportunity to harness new technology to deliver a major step forward in giving the public a greater influence over the Whitehall policy making process.

Revitalising our politics, our governance and our democracy means going beyond simply increased openness about previously secret information – it requires the policy-making monopoly of ministers and the civil service to be challenged – where practicable – through a step change in the opportunities for people to engage with and interact with government in its policy proposals.

And it also means a less centralised approach to government. The Chancellor will publish on Wednesday Ian Smith’s report on how to secure a further substantial transfer of civil servants out of London and the South East to other parts of the country. I intend to build on this in the next parliament with a further strengthening of the role of regional ministers and a streamlining and amalgamation of central government functions at the regional level.

At the same time I want to look again at whether we need so many independent Whitehall departments in the age of digital government. Most policy and delivery issues cut across the departmental boundaries – and it is not clear – despite much  innovation and experimentation with cross cutting units projects and public service agreements – how the traditional silo-based Whitehall approach can best be overcome.

I have said there will be at least a 20 per cent cut in the senior civil service paybill and the Chancellor will provide more details of this in the Budget. And as we make these radical changes we can also reduce the number of Whitehall departments.

But as well as rethinking how the different parts of the Government machine can be streamlined and decentralised we must urgently explore too how all practical means for giving the public far greater influence over the Whitehall and Westminster policy-making processes.

The web and the internet offers us a chance to reinvent “deliberative democracy” for the modern age.

Digital government will help open the door to new ways of enabling people to influence and even decide public policy. And it will give them better and more comprehensive access to the information they need to make informed choices.

Ultimately this can provide the basis for them to participate in deliberative processes to formulate policy – setting off a historic shift in the way public policy is made.

This includes opening more policy development to wider scrutiny, for example through the use of e-petitions and deliberative events.

Since it was established at the end of 2006, the number 10 e-petitions service has received more than 70 thousand petitions. There have been more than 12 million signatures placed and the Government has replied with more than 8 million e-mail responses.

Each week I record a podcast and use twitter most days. Number10.gov.uk carries out daily conversations with more than 1.7 million followers. There have been almost 2 million views of our images on flickr and 4.3 million views of our films and videos on YouTube.

But we can do much more. Today, we are launching a brand new Number 10 iPhone application that will bring news, video and audio from the downing street website to potentially millions of users completely free of charge.

So what I am talking about is in essence a new partnership to govern – an invitation for people to directly share in the task of government that is there to serve them.

And I am today tasking every department to identify the far wider scope for deliberative engagements with the public, specifiying the outcome expected from such engagement.

The digital revolution is creating a different world. And I know that we in Britain have the spirit and the talent to take the lead in that new world.

The question is whether we are bold enough to make the necessary decisions today to build Britain’s digital future.

My message is clear.

We have the courage to invest in that future and secure the growth and jobs it offers not just today but for generations to come.

We have the determination to harness the new digital technology to shake up Whitehall and drive a radical reshaping of government – focused on giving people a greater say over the policies that affect their lives and the services on which they depend.

And above all – we have the resolve to make sure that the immense opportunities that Britain’s digital future offers us are available to all – not just to some.

Below is the text of the speech made by Gordon Brown, the then Prime Minister, to the Progressive Governance Conference in 2010.

Over the last decade Policy Network has performed a momentous role in the development of progressive thinking, bringing us together as a global progressive family.

Few organisations could have achieved more in such a short space of time.

And in particular, let me say what an honour it is to welcome Prime Ministers Stoltenberg and Zapatero to Britain.

Prime Minister Stoltenberg has been a global leader on development and climate change and let me thank him and Norway for their pioneering initiatives on health education and environment.

And Prime Minister Zapatero has inspired the world with his passion and programme for social rights, his commitment to equality for women, and his determination that Spain will lead in international aid for the poorest countries of the world.

By the actions they have taken, founded on the progressive beliefs they hold, both Prime Minister Stoltenberg and Prime Minister Zapatero have changed the world for the better and forever and we are very proud of all that they have achieved.

And today, I want us to imagine what people will say of us all, a century from now.

People look back on the moments that are the turning points in world history.

1789. 1848. 1945. 1989.

Only in retrospect do people see the significance of the times they are living through.

But in the last two years our world has been suffering not just an ordinary economic downturn but the first crisis of globalisation.

It is the first crisis of a world being totally transformed by the scale of global financial flows, by the global sourcing of goods and by the speed scale and scope of globalisation itself – a world of massive new opportunities but also of massive new uncertainties and insecurities too.

What we have experienced is not the usual inflation-driven economic crises like we have seen in the past, but a wholesale crisis that has gone right to the heart of the global financial system itself.

And so it is time for us to draw conclusions about the new framework and policies we need to build a stronger and fairer world economy that will meet the needs of its citizens in this new global age.

Quite simply: without radical change we will not be able to emerge from the crisis into a stronger, fairer, more stable future. And so here are my proposals;

I believe first of all that we now need nothing short of a world constitution for the global financial system.

Second I believe that that each country needs national growth and jobs strategies founded on innovation and skills, but also – and this is my key point – growth for each us will be lower and therefore low growth will affect all of us, unless there is a strategy for global growth agreed between the G20 countries.

Third I believe that as we developed the skilled jobs of the future we should see social mobility as the modern route to social justice and devise together the radical measures to massively accelerate the rate of social mobility in our societies.

And fourth with globalisation we have a unique chance to recognise our global independence as citizens and work towards a truly global society: towards a world free from climate change catastrophe ; and a world free from terrorism, poverty, disease, illiteracy and inequality.

Together my proposals are the modern progressive way of achieving our historic goals of economic progress social justice and environmental care.

So let me begin with proposals for financial reform, because the lesson of the financial crisis is a progressive one — that markets need morals.

Let me say clearly that we need successful and profitable banks for our economies to flourish.

But left to their own devices, they do not always self-regulate and self-correct; sometimes instead they self-destruct.

The great myth the right are spreading through their friends in the press is that government caused this crisis and that government spending is prolonging it.

But what caused this crisis was unfettered markets which imploded and destroyed growth.

The last two years have exposed free market fundamentalism, destroyed the idea that the private sector working badly is inherently better than the public sector working well.

And they have shown that while markets must be free, they should never be values-free – that if they are to work, they must be underpinned by the same ideas of fairness, responsibility, hard work and just rewards that we celebrate at home and at work.

And either we will learn these full lessons from this financial crisis – and advance a global growth strategy that delivers both jobs and social mobility – or we will relapse into the old ways of business as usual and bring crisis upon ourselves anew.

And that is why we in Britain have a radical set of policies to transform financial services and why:

We are ensuring that the public money loaned to the nation’s banks is fully repaid.

Why we have set new rules for financial bonuses.

Why we have set a 50% tax on this year’s bonuses over £25,000 and raised the tax rate on earnings above £150,000.

And why we have restructured our banks by ensuring they have not only sufficient day to day liquidity but sufficient capital to withstand the crisis.

We are doing what we can in Britain to give our banks a sound capital base from which to move forward.

But we need a global solution: common rules for capital and liquidity, common standards for supervision, common rules for bonuses and a shared way of assessing the contribution banks should make to society, free of the unfair and disproportionate use of regulatory and tax havens which penalise countries doing the right things.

So we in Britain hope to work with the people gathered here, and those from other countries, to develop a new world constitution for the global financial economy which will deliver these objectives.

And just as we began the debate about the best way for the sharing of risk and reward with banks with our report back in December, we are now discussing with the IMF and other countries the prospect of a global levy that will embody the contribution global banks should make to the public interest.

I hope that all these things can be agreed in the coming months in the meetings in Canada and Korea. Because one thing is clear; either governments cooperate internationally, or the invisible hand of the unfettered market will fail us again.

But let me talk of a second truth we have recognsied: that it is not by chance but by adopting social democratic policies that countries have got on the road to recovery round the world.

Here in Britain, if the experience of the last recession of government inaction had been repeated, people’s chances of having a job would have been four times worse after they became unemployed, repossessions twice as bad, and company insolvencies two and a half times worse.

So the recovery did not happen by accident it is happening because of our actions – our interventions to secure jobs, to maintain mortgages and to help businesses large and small.

Of course nothing is inevitable – neither progress nor retreat; it is a question of whether we are prepared to fight to secure the recovery, or will allow our opponents to put it at risk.

And now we face a new choice for 2010 about that fiscal stimulus -whether to continue the stimulus to make sure that a fragile global recovery does not dip into a further recession or whether we take the necessary measures to ensure that growth in 2010 is stronger and more stable.

So this is the critical question economies round the world face now: whether to go for growth in 2010. Progressive rounds the world say rightly that we have to go for growth and do nothing to put the recovery at risk.

Put simply today’s letter to the FT by over 50 leading economists argues that the first priority must be robust growth. I say to the British people this is not the time to put the recovery at risk, this is the time to make sure that growth and jobs are secured.

But instead of admitting the mistakes of private banks and financial institutions, this well financed right wing are not only trying to blame governments for the crisis, but trying to use legitimate concerns about deficits to scare people into accepting a bleak and austere picture of the future for the majority and then to use it as a pretext for public services to be marginalised at precisely the moment they should become smarter and more personalised. And they are using the cloak of action of debt to conceal the hard fact that their real position is that they remain wedded -as they have always been – to an ideology that would always make government the problem and deny people the helping hand that government can be.

It was said of the Hapsburgs that they would never learn by their mistakes. This is true of the Conservatives. So instead of helping the recovery, in our country Conservative dislike bordering on hatred of government action would risk the recovery now.

And so I am confident that if we are prepared to fight for our progressive values, we can continue to win the battle of ideas in the years to come. I am convinced that the growth of the future belongs to those countries which make and do things once again.

But beyond a transformation in financial services, we need a growth strategy where we can rebuild from secure foundations of new industries and new jobs.

That includes a strategy for bringing our deficit down. And we have been crystal clear that we will halve the deficit over the next four years – indeed more than halve it.

That does mean that we must raise taxes and cut some programmes. But the vast majority of the increase in our deficit since the global financial crisis hit the UK has been caused by a decline in estimated tax revenue – and so we must redouble our efforts to restore growth and get people back into work.

But we cannot rely on markets alone to make the right decisions

The creative, digital, scientific and low carbon revolutions are simply too big and too important to the rest of the economy to be left to chance.

Up until now, with the banks failing to make the right decisions and finance has not done enough to serve industry.

And that is why we are creating funds and institutions that take a long term view – helping businesses to access the finance they need to start and grow and supporting the creation of a modern, low carbon infrastructure.

And it is why we have decided that as a nation we will

– Back British scientists

– invest in renewable energy

– give priority to biotechnology

– And encourage digital and creative industries

And even as we implement our tough deficit reduction plan – to more than halve the deficit in four years – we will remain resolutely focused on progressive priorities – protecting the key front line services and targeting investment to take our country forward.

Take just one example; we are investing the most ambitious plan of any country to ensure a digital Britain for all.

In fact already as a result of the expansion of digital, the UK is the world’s leading internet gateway with 36% of internet traffic routed through UK servers.

The first step to the future is the delivery of the universal service commitment, which will give virtually every household in the UK a broadband service of around 2 megabytes per second. The World Bank estimates that every 10% increase in broadband penetration results in a per capita increase in GDP of over 1% households offline are missing out on savings of £560 per year from shopping and paying bills online.

The next stage is superfast broadband – our next generation access plans will see government invest over £1 billion between over the next seven years. For some people it will mean massive increases in the speed they have, by maybe as much as 50 times more access available to 90% of the population by 2017.

The third stage is to reach the final 10% – satellites could have a role to play, as could mobile broadband – and that is our ambition. The body which will be set up to advise on how best to use the new investment to deliver next generation access will advise on how best to reach the final 10%.

And to achieve this we will invest one billion pounds of public money in private sector projects. You might think that a policy of partnership to achieve the digital revolution is so obvious that not even a right wing party would oppose it. But far from being modern, the Conservative view has retreated in Britain to the old one- to let the market decide everything.

But we want every family and every business and not just some to benefit from the new technology – and because we know that under a policy of leaving it to the market only some will benefit from high quality broadband – and poorer areas and remote communities will be denied it or offered it at such a cost that they will be unable to afford it.

So when people ask why we in Britain are prepared to offer direct support to the business community of a total of £1 billion in incentives and support so that we become a world-leading digital economy, it is because we want to prevent a digital deficit and ensure digital access for all .

And a modern industrial society embraces direct support for a balanced energy policy to combat climate change and dependence upon oil and that is why we are investing in using thousands of miles of coastline and shallow waters to become the world’s largest offshore wind power. It is our answer to those sceptics and climate change deniers who say we can do nothing about climate change.

And my answer to all these questions about government investment through a crisis is simple; it is because these policies taken together will bring 2 million new skilled jobs to our country, set the course for employment growth over the next few years, and quite simply because some things are too important to jobs and our shared prosperity to be left to the market alone.

We need not just a new financial markets policy and an industrial policy for the jobs of the future. But our task is so much wider still – because for the progressive left the question is not simply how many decent jobs are there in total – but who are they going to, and whose lives will they change? And so let me talk about my third proposal – to take radical action to accelerate the rate of social mobility in our societies.

For the left employment has always been more than a way to survive but a ladder of opportunity for people hoping for a better life for themselves and their families. That is why we strive not only for full employment but for decent work – not simply for jobs at any price, but for work with prospects that can lift those on modest incomes into the middle, and the middle class onwards to the top.

Time and time again when I travel around Britain I meet people who would never have gone to university and got a decent job without Labour’s help for family finances making it easier for young people to stay on at school and invest in their futures. And I do not understand how the Conservatives can turn around to this generation and say that there is only limited room at the top and the vast majority of young people should resign themselves to never reaching it.

That, to me, is a betrayal of Britain’s future – and so let me tell you about three ways we are backing parents’ aspirations with government action to give children springboards to soar from.

First; because we know that the first two years of a child’s life are more important in determining outcomes than the next twenty years, we have invested in early learning with Sure Start children’s centres – in every community not just for a few – a policy that the Conservatives would put into reverse.

Second; we have pledged that every child who needs it will get one to one tuition in the state sector, the kind of personalisation that those who can afford to pay take for granted in private schools. This too has not been supported by the Conservatives.

Third; we have raised the education and training leaving age to 18, so that every young person enters adulthood with the chance of an apprenticeship, a place at college or the option of university. This too has not been supported by the Conservatives.

And the evidence suggests that if we maintain effective investment and reform in our schools and children’s centres, the proportion of low-income children achieving five good GCSEs could rise by around half between now and 2020 – and the proportion getting A-level equivalent qualifications at 19 will almost double over the same period.

So we know what works – and we have shown in Britain that we can unleash social mobility when we both believe in and invest in the potential of each and every child. And let us tell the truth. Conservative policies would remove these opportunities from young families – Sure Start at risk, educational maintenance allowances at risk free personal tuition in schools at risk, education to 18 all at risk. Instead of defending ordinary families they would kick the ladder of opportunity away from them. And instead of supporting the middle classes, their policies would hurt the middle classes.

And so today let us be confident and proud to be progressives. Because today the left has three winning arguments;

– that only we can regulate the market in the people’s interest

– that only we can pursue the industrial policy that will deliver the jobs of the future and

– only we can ensure a social mobility revolution that means birth is not destiny

And when people say that times when money is tighter are not good ones for progressives, I say that is exactly when people need a progressive government even more. And so on every test of domestic policy, it is the parties of the centre-left which have the answers.

But we also have a further characteristic that makes our values profoundly of the time – and it would be remiss not to mention it at this great progressive governance conference which has brought people together from every continent.

We are, of course, the true internationalists – the people who know we are stronger together than we ever could be apart.

And I know that people have been deeply concerned by recent developments on the British right, by the decision of the British Conservative Party to leave the mainstream right grouping in the European Parliament to join an alliance of the extremes and the fringes. So let me reassure you today; as long as I remain Prime Minister, Britain will stay firmly in Europe’s mainstream, never in its backwaters, and we will resist the attempts of the Conservatives to pull Britain into isolation and irrelevance.

The obsession of the Tories with narrow nationalism is totally out of tune with the modern world – because people today know that no one country can solve terrorism or conflict or poverty or climate change on their own, that there is no firm line separating what happens ‘over there’ from what happens ‘over here’.

Earlier this month, we celebrated the 20th anniversary of the release of Nelson Mandela. It was an event I will never forget – not simply because of what it meant for South Africa, but because of what it said about the ability of people of good conscience to impact on what happens a continent away. As Nelson Mandela himself said, he was the servant of a worldwide cause.

As I said on the anniversary, one day we will explain to our children why so many streets, student union buildings, council chambers, town squares and even people in Britain are named after this man from so far away. We will tell them about a great uprising of hope – a time when ordinary people stood up for justice, and we prevailed.

It reminded me of that amazing video that was made for Live8. It shows great social movements in history – but it pans past the people who made the headlines and focuses in on the people behind them.

So in the great abolitionist rallies it goes past Wilberforce to focus on a face in the crowd. Then they show the votes for women campaign and go past the Pankhurst to those who protested alongside them. And then it shows the march on Washington but pans past Dr King to focus on all those he had mobilised to march with him.

The point it makes, of course, is that great change only occurs when leaders inspire others to follow – when they stand up for justice and pass its torch along, person to person, to build a movement, first hundreds, then thousands and then finally millions strong.

That is the lesson those campaigners of the past are trying to teach us. If we listen, we can hear them whisper from the past – hear them remind us that change never comes without a fight, but when we fight, progressives can change the course of history.

And so while the right are marshalling the vested interests, we are marshalling a movement, fighting not for a candidate but a cause. Let us never forget that throughout all time there have been people who have fought and won – progressives who have brought great change starting with their courage to will it.

We’ve done it before – we will do it again. There is nothing to do now, but begin.