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Maude: Labour trust the state, we trust society and people

Politeia Spring Address

It's a great pleasure to have been asked to deliver Politeia's Spring Address. Politeia's work resonates with all Conservatives, and has been in the vanguard over many years of the intellectual quest on the centre right.

Through research, debate, discussion and reflection, you address the questions that brought us all into politics:

Where should the lines of responsibility between the state and individual be drawn?

And how can we move from an overpowering state, which commands and controls to an enabling state, which facilitates and empowers?

I occasionally hear people say that there's no real difference between the parties anymore.

Rubbish.

There couldn't be a starker difference: Labour trust the state, we trust society, people.

Labour believe in top-down state control, Conservatives believe in bottom-up social responsibility.

Social responsibility

This idea is central to modern Conservatism and our vision of moern Britain.

A Britain where we do not just ask what government can do, but we ask what people and society can do.

A Britain where we realise we have responsibilities not just to ourselves, but also a social responsibility to each other.

Social Responsibility and Voluntary Sector

Today, I want to speak about the role of the voluntary sector in this Conservative vision of social responsibility.

Now, I am incredibly optimistic about the future of our country. That's why I came into politics. I saw a bright past and a bright future.

But we have to be honest.

There is a genuine crisis in parts of our society, where a complex web of interconnected problems - drugs, homelessness, crime, family breakdown - traps too many people in deprivation.

More people in severe poverty than a decade ago.

Almost one and a half million children being brought up by addicts.

Nearly nine million people with debt problems.

These are sobering and thought-provoking statistics.

Now, it would be easy for say: "Don't worry. We have all the answers. Vote for us and we can sort everything out."

But that would be disingenuous.

Social responsibility means recognising that the state does not have all the answers.

All of us - politicians, business leaders, community leaders, parents, teachers and, yes, voluntary bodies, have a part to play.

So, the young unruly child who is not making progress at school:

Yes, the government has a responsibility: to provide the framework of an education system that demands high standards.

But so does the teacher… to enforce discipline.

So does the parent… to provide the love and attention all children need.

And so does the local social enterprise…that keeps him or her off the street and opens their horizons to sport or art.

Or the elderly person who lives all alone.

Yes the government has a responsibility: to provide adequate care for when they become ill.

But so do neighbours - to check up on them and ensure they are OK

And so do voluntary bodies - to provide warm meals and a friendly face every now and then.

And there are so many voluntary bodies making such a difference like this already.

I'm continually struck by the creativity and variety of social enterprises and community groups.

The group in Bath that helps people addicted to alcohol or drugs to break the habit and find work - and whose volunteers include a number of people who have come through their programme.

The non-alcoholic café/club in Stirling run by a church that provides a safe, fun and popular venue for young people who might otherwise be on the street.

The youth club in Bristol set up by Dave Jeal, the chaplain in a youth custody institution, in a redundant church that he has taken over.

What's more, be it in the response to the Asian tsunami or support for single issue causes such as Make Poverty History, there is an authentic flowering of kindness and care among people.

There is another simple reason why I believe in the third sector: I trust people.

The desire to help is the spirit embodied by voluntary and charitable groups, and we politicians must learn to trust them to act on that impulse without excessive central direction.

There are some 700,000 non-statutory, non-profit organisations in the UK.

They include everything from a handful of neighbours getting together to organise a play group, to the great national charities like the NSPCC or the National Trust.

They include social enterprises, clubs, religious bodies, trade unions, pressure groups, friendly societies, care homes, and many more.

The map of social action in Britain is a vibrant tapestry of institutions and organisations.

We've hardly begun to harness its true potential.

We need to give it more power and more responsibility.

Labour Record

But that has not, and will not, happen under a Labour government.

Gordon Brown once called charity "the sad and seedy competition for public money".

That is all he sees it as, some impoverished relation to Government.

He just cannot let go.

For him, society is the same thing as the state.

But for Conservatives, there is such a thing as society, it's just not the same thing as the state.

Those 700,000 bodies are the glue that hold society together.

Of course there have been some positive developments under Labour.

The Chancellor extended Gift Aid, which means that more charities benefit from tax breaks on donations. As the example of the United States shows, tax incentives can play an important role in encouraging social action.

But, despite this, institutionally the current government is working against the voluntary sector.

Whereas government departments get three-year funding from the Treasury, Whitehall service contracts with voluntary bodies often last for a year or less.

Not only does this create a culture of uncertainty, it also hinders long-term planning.

What's more, when applying for contracts in the public sector, private firms can recover their costs but social enterprises can't.

Why should a large management consultancy be allowed to charge whatever they like, including their overheads, without a peep from public sector purchasers, while a charity offering consultancy services can't do the same?

This is ridiculous.

It is also unreasonable that after voluntary bodies have managed to jump through all the hoops of the Charity Commission and Companies House and finally been registered they will suffer more inspection and monitoring than commercial companies.

This despite the fact there is no evidence of greater fraud or abuse in the voluntary sector.

All in all, guess what proportion of government spending goes on voluntary organisations?

Less than half a per cent.

And guess what the government's target was to raise this by in 2005?

Five per cent.

So they planned to raise spending on the voluntary sector from 0.5 per cent to 0.525 per cent.

That's not exactly ambitious.

Conservative Action

If we're serious about the social sector playing a greater role in social action, then government and the public sector has to let the social sector and social entrepreneurs take wings and soar.

David Cameron has suggested, for example, that we should look at establishing Social Action Zones, which would attract funding for the voluntary sector, and where there would be fewer bureaucratic obstacles for community groups.

Just as we encouraged our business leaders to go our inner cities, create jobs, wealth and opportunity in Enterprise Zones so we should now encourage voluntary sector leaders, whose solutions are working where the state is failing, to turn our neighbourhoods around in Social Action Zones.

Indeed, the 1980s analogy is apt.

Back then, we were in economic decline.

We needed something revolutionary to reverse it and set us on the road to prosperity.

Today, there is social turmoil.

We need to be just as revolutionary to set us back on track to social prosperity.

Above all, there are three things that are vital for the future success of the third sector.

First, we need more long-term thinking by giving projects the proper time to develop.

The government has a terrible tendency to create the impression of national activity by funding short-term pilot projects in a handful of locations, without giving the projects proper time to develop.

What impression does this give?

Instead of seeing any failures as evidence of incompetence or fraud, we need to give them time to innovate and learn from mistakes.

Second, we need to create a truly level playing field for the third sector to compete with public or commercial bodies for contracts.

And third, the government needs to free the third sector by trusting it to conduct its own affairs.

Political parties and funding

The voluntary sector does not just encompass charities and social action, but also political parties. These are quintessentially voluntary bodies.

Democracy needs vigorous political parties. And parties, like charities, need money. But party funding cannot go on as it is. Last year, we set out a coherent package of proposals to clean up the way we fund our party politics. Many of the proposals would work against our partisan interests, but we took the view that they were nonetheless in the public interest.

One of those proposals was the suggestion - controversial to many - that there might be an increase in state funding. But let me say this. There should be not a penny more state funding without a single, comprehensive cap on donations - including companies, the unions and individuals. The public will be highly cynical if political parties award themselves lump-sum handouts without fundamental reform.

Any additional state funding should be there to assist and encourage parties to re-engage with the electorate, for example, through tax relief on small donations and a matched funding scheme for those who do not pay tax.

State funding must not reduce the dependence of parties upon their own activists for fundraising. Nor must it be allowed to increase the distance between the parties and the electorate.

The Labour Party are currently trying to use Sir Hayden Phillips' review of party funding to rescue from their current dire plight, where they have the police at the front door and the bailiff at the back.

Sir Hayden was asked by the Prime Minister to examine ways to restore public confidence in politics by changes to the way parties are funded. Labour have come up with a clever wheeze whereby by its own dominant funder, the trade union movement, would remain unaffected by any checks or caps, while opposition parties would face stringent caps on what they could spend either nationally or locally. This is a recipe for a one party state.

After all the party in Government benefits in myriad ways from the simple fact of being in Government. Hundreds of taxpayer-funded special advisers and Government press officers are at the beck and call of Government ministers.

And today sitting MPs, most of whom by definition belong to the Government party, enjoy generous taxpayer-funded allowances which can be used to employ staff, run websites and distribute leaflets to their constituents.

So to impose a rigid annual cap on party spending, whether locally or nationally, would be to entrench a huge advantage in favour of an incumbent Government. No opposition party could ever agree to that, and no Government party should ever contemplate it.

Let's be quite clear: the reason party funding needs reform is nothing to do with how much is spent. It is all about the concern that a large donor can buy political influence or patronage.

That can be addressed by the simple measure of a cap on donations. Both the Liberal Democrats and the Conservatives have proposed a cap of £50,000 a year.

We think this is a level at which no one will seriously fear that a party is subject to undue influence. This would cause us some financial pain, but we are willing to undergo that in order to win back the public's trust in the political process.

Labour by contrast have entered a resounding veto on any such cap. They maintain that the trade unions are a special case. Well, in one sense they are. The proportion of Labour's funding provided by a handful of trade union leaders is around 70%. And there is nothing remotely covert about what is given in return. It is all there to be seen.

To pay for the 2005 election campaign, Labour reached a deal with the unions called the Warwick Agreement. The unions stumped up £12 million to fund Labour's election campaign. And in return, there was £10 million of taxpayers' money for the Union Modernisation Fund, extra rights for strikers, and a deal which means civil servants still get to retire earlier than those in the private sector.

This has all the hallmarks of a straightforward commercial transaction. It is precisely this kind of trade - cash for policy, or in the case of the Union Modernisation Fund union cash in return for taxpayers' cash - that has eroded public confidence in the integrity of the political process. Reform of party funding that failed to remedy this would be shockingly cynical and a terrible wasted opportunity.

There would be a further democratic penalty if local expenditure caps of the type being promoted by Labour were to be introduced. Such caps would be the enemy of what we all say we want to encourage, the engagement of local people in local politics.

Restrictions on how many leaflets councillors and candidates could deliver would be deeply counter-productive to local political engagement. If a local party managed to persuade twenty thousand local electors to donate £5 a head towards local campaigning outside of election periods, there would be a universal cheer. This would be seen as exactly the right kind of political reinvigoration. Yet local spending caps would prevent this.

And there is a further penalty. Who would want to be a local party treasurer, with the threat of going to jail if a leaflet isn't reported?

Who will carry out the detailed and complex compliance work in areas where there isn't a professional agent or organiser?

What exactly would counts as a campaign expense outside election time? Should a letter from a councillor to local residents be deemed political expenditure?

We recognise that there is concern that single donors might have disproportionate influence on local parties. This can be addressed simply and effectively by a cap on donations, perhaps with a lower cap for donations at a local level.

We must ensure that political parties are the champions of the people, and not be absorbed into the fabric of the state or smothered by state regulation.

Conclusion

The 20th century was dominated by a great, sweeping change: the introduction of state welfare.

There were successes, great steps forward for our country which must never be reversed: universal education, universal healthcare.

But with it came a sense that we have to leave the big achievements of change to the government.

I have already said there is an authentic and genuine flowering of compassion and care in society.

There is also a latent stock of dynamic social capital within it too.

People with great ideas who just have not been given the opportunity to undertake them.

Set these two elements free, and a thousand flowers would certainly start to bloom.

By putting in the place the principles of social responsibility and empowering and encouraging individuals to find local solutions to local problems, I am sure the capacity will make up the shortfall.

I believe that the respective roles of the state and of communities in rising to the great social challenges will be one of the great philosophical divides between Conservative and Labour in the next decade.

Labour's historic preference for centralised state control. Or the Conservatives' commitment to social responsibility. I know which I think is most in tune with the British public.

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