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Willetts: 2020 Vision - A Better Society

Speech to the Child Poverty Action Group

"Successful political leaders offer a compelling vision of their own country. It should be a coherent and recognisable account of what it is like. But it should also go beyond that and be a challenge to make it better. It should be a vision to which a country can aspire to and which offers hope and purpose. De Gaulle had 'une certaine idée de la France.' Winston Churchill painted a picture of dogged British courage which shaped the behaviour of wartime Britain.

Conservatives have more recently retreated from such visions. Instead we appealed to "common sense" or offered a "timetable for action." We are just supposed to be practical people, offering nothing as dangerous as a vision. This we hope is a refreshing contrast with Tony Blair's more portentous and emotional speeches - we suspect there is a ham actor beneath. But the danger is that we just make Conservatism seem banal.

The retreat from bold visions may mark a deep uncertainty about our own country. We can't decide if Britain in 2005 is a bad place to be or a good place.

The pessimists say that Britain is a broken society. There are deep moral truths about good ways of living which we Conservatives should speak up for. If we don't there will be more broken families and fragmented lives.

The optimists say more people in Britain lead happier, more fulfilled lives than ever before. We are more individualistic and that in itself makes relationships more fragile. Once upon a time we told people to get on their bike and move on in search of work, so we shouldn't be surprised that some got on their bike and went in search of a new partner as well? And anyway, they might add, after the fiasco of back to basics, who are we to tell people how to lead their lives.

Over the past 30 years Conservatives have hammered out a coherent account of the British economy and how we would manage it. We are all familiar with the case for lower tax, encouraging enterprise, cutting back red tape. But when it comes to our society and our culture we have an extraordinary range of views from those who believe that we are in the direst state of moral and social decay, to those who think that we have the greatest opportunities for personal fulfilment ever in British history. If we have a fuzzy and confused picture of our own country it is no surprise that our country has a fuzzy and confused picture of us.

So today I want to investigate the question of what sort of society we think Britain is and what we believe Conservatives should do to make it better. And where better to do that than here at the Child Poverty Action Group. You have been at the forefront of reminding us of the people left behind even as the British economy grows. You have posed uncomfortable questions to politicians of all parties as to why we have child poverty in a growing economy. And child poverty in particular surely reminds us of the obligations we undoubtedly have to our fellow citizens.

The Conventional Wisdom - Atomisation

There is a crucial assumption about British society which is shared by optimists and pessimists alike. They agree that the most important trend shaping British society today is a shift to ever greater individualism. Society is being atomised as the big molecules of family and neighbourhood fragment. If there is one statistic that captures this above all it is the shrinking size of the British household as more and more of us spend more of our lives living on our own. Average household size in England fell from 3.01 in 1961 to 2.32 in 2003: it is projected to fall to 2.15 in 2021. In fact on this trend we are all living on our own by 2144. And just about everybody seems to agree not only that this trend is real but also that the Government is powerless to do anything about it. The only question that is left is endlessly to argue whether it is a good thing or not - like people living through a tropical hurricane debating whether or not the destruction is improving the view.

The original brilliant prediction of this transformation of society under capitalism described it like this:

"Constant revolutionising of production, uninterrupted

disturbance of all social conditions, everlasting uncertainty

and agitation distinguished the bourgeois epoch from all

earlier ones. All fixed, fast-frozen relations, with their

ancient and venerable prejudices and opinions are swept

away, all new formed ones become antiquated before they

can ossify. All that is solid melts into air, all that is holy

is profaned, and man is at last compelled to face, with

sober senses, his real conditions of life and his relations

with his kind."

It is of course a quotation from Karl Marx's Communist Manifesto.

The leading contemporary social thinker, who has done more than anyone else to think through the implications of this model is none other than Tony Blair's philosopher-in-chief, Anthony Giddens. He takes the free market argument for choice and extends it to everything. We don't just choose goods and services, we choose who we are as well. We choose our obligations to others. In fact what he calls a "pure" relationship is one between two adults based purely on choice and without any other obligations that haven't been chosen. Children don't really fit into this model. It is a world of friends not families. And in today's Conservative Party the way we are supposed to show we understand how these ties are weakening is to stop wearing them.

Traditional free market economics just takes it for granted that there is a robust individual secure in his or her identity who then does the choosing. But with Giddens we choose who we are as well. You never quite know where the choosing stops and the chooser begins. The greatest practitioner of this as a style of politics is surely Tony Blair. One of the things that makes Conservatives uncomfortable with him is that what we think of as fundamental attributes and beliefs somehow seem with him to be chosen for the day, rather like someone matching their clothes to the weather.

The Alternative Model - The Lifecycle

The very fact that this discomfort with Blair is so widespread is an important clue. Perhaps this whole model of a fragmented society with more tenuous obligations and identities, is not the whole picture after all. Maybe the assumption which those optimists and pessimists share that is itself deeply misconceived. There are other ways of understanding our society and it is these I now wish to investigate.

There is a very different picture of Britain than this one of fragmentation and atomisation. Instead it is one in which we move through different stages of the lifecycle. In our youth we enjoy the freedom which comes from being unattached. That period of our lives now lasts longer than ever. It is a time when we have more discretionary spending, without the obligations of mortgages and kids, so it drives advertising budgets and media coverage. But then we do settle down to a long-term relationship and a long-term job. All the evidence is that these aspirations for a steady marriage in which to raise your kids, for a long-term job, and to owning your own home, are as widespread as ever. All of these aspirations share a crucial feature - they bring with them ties and connections that link us to people and places.

Modern life is indeed different but to see this difference in terms of fragmentation and atomisation is misleading. What has really happened is that that stage of the lifecycle before we settle down is longer than ever. We have also added other stages, as relationships break down, for example, or living longer on our own after the death of a spouse.

If you count all households many fewer of them are headed by a married couple than twenty or forty years ago. But this can be very misleading. Take six people. There is a 25-year-old living in a bedsit after leaving university. There is 50-year-olds in a married couple with teenage children at home. There is a 75-year-old widow on her own. You can make a headline out of that by saying 'only one in three households now comprises a married couple with children.' But in reality, if you measure people, not households, there are still four of those six people living in such a family. Moreover, we have to understand the changes that have brought us to this position. Perhaps in the past the 25-year-old would already be married and the 75-year-old would sadly have been less likely to have lived to an old age on her own. So yes, we have expanded other stages of our lives but that doesn't mean that the family has disappeared. Most people still spend most of their time in households headed by a married couple.

There is one crucial feature of modern life. We do all the trivial things quickly but the big things take us ages. Modern life is very slow. We are endlessly prevaricating, comparing and experimenting instead of deciding, giving, and committing.

This is not to say that we are all just on our way to settling down with a pipe and slippers. It is not to give one stage of the lifecycle pre-eminence over everything else. In fact I hope it is a way of making us a bit more tolerant of diversity as we recognise people have different hopes and fears as they go through their lives. It may be that in the endless Conservative balancing of freedom and security we find there are stages in our lives when freedom is what matters to us above all and there are times when it is security we seek. A Conservatism which values equally all the different stages of our lives will find it easier to hold these aspirations in balance.

This way of thinking also brings the family back to a much more fundamental role than it is allowed in Third Way thinking.

Families, and the vertical ties that link us across the generations remain very important. We might have a phase of our lives when we are living like an episode of 'Friends' but most of us wind up like 'The Simpsons.' To quote a recent ESRC Report: 'Four out of five people would rather spend time with family than with friends.' One reason why 'The Simpsons' is a far more satisfying programme is surely that it shows different generations together.

You don't choose who your parents are and you don't choose your relatives. So there are strong ties, which we don't choose, which shape our identities and give us inescapable obligations. We are not a society of classmates: instead we should recognise powerful intergenerational ties. Half of British adults with a living mother see her at least once a week. Some of these ties are actually getting stronger.

Children live with their parents much longer than they used to. In fact, many people go back to live with their parents after that first cohabitation has broken down. High house prices don't help either. This was brought home to me by research from Lever Faberge, who want to understand family change to help them market their products. They make the deodorant Lynx, targeted at young men who want to believe it will make them irresistible to women. But what did they find? Increasingly it was being bought by middle-aged mothers for their 20-something sons who were still living at home.

Even when we do leave home, we are much more financially dependent on our parents than before. And it doesn't stop there. On average grandparents contribute £2,300 a year to their families, not far short of the value of Child Benefit. Everybody talks about the enormous explosion in childcare over the past twenty years, but which is the group whose contribution to childcare has increased by more than any others - it is grandparents, 82% of children are cared for full-time or part-time by their grandparents. In fact grandparents are probably now spending more time with their grandchildren than in any recent period of British history.

Nowadays politicians are endlessly in pursuit of narrative, something which holds policies together in a coherent whole. What better and fundamental narrative could there be than wanting to strengthen society through the stages of the lifecycle? We should celebrate the ties across the generations and the tolerance which that brings. And as Conservatives we want to pass our country on to the next generation in at least as good a state as we found it.

This model helps to provide a coherent Conservative understanding of the case for the welfare state. Whatever its flaws, which are many, its underlying purpose is inter-generational solidarity, something which Conservatives can understand. It is not just the distribution of money from rich to poor - important though that is. Above all it is redistribution of resources across the lifecycle. A toddler can't totter into a bank to borrow £60,000 to pay for his or her schooling to be repaid out of future earnings.

There is an exciting Conservative agenda here of taking the traditional role of the welfare state and making it much more personal. An individual could have an account that financed their education, was the basis for saving up a sum of money for paying off their university loans, could be a deposit on their first house, and eventually could be the core of their pension entitlement as well. We have had a host of disparate attempts by the Government to help people at particular stages of the lifecycle, giving them or lending them more money. There is the Child Trust Fund. Individual Learning Accounts were introduced and then abandoned. There is the Educational Maintenance Allowance. We have Student Loans. There are Stakeholder Pensions. It would be an exciting project to try to tie these together into a single account that stayed with people through the different stages of their lives. It would be a nest egg account with contributions from the government and rewards for individual savers as well.

This picture of society has got real potential. It means that Conservatives need not be the Solzhenitsyn party conducting a solitary battle against our society from the outside. We break free from the arguments between optimists and pessimists, modernisers and traditionalists. We recognise how people's lives are shaped as they go through the stages of the lifecycle. We celebrate the underlying strengths of our society. But then we try to tackle the particular problems we face. We don't twitch at the net curtains looking out furtively at what is happening to our country. Instead we roll up our sleeves to tackle the particular social problems that are wounds on the body politic.

An open and mobile society

Our vision of Britain is surely one in which Britain is open, mobile and meritocratic. Almost exactly five years ago the Chancellor of the Exchequer spoke to the Child Poverty Action Group setting out his vision of spreading opportunity in an open, mobile society. Perhaps I can quote his words, as they are very powerful:

'What was rewarded in the old Britain was too often, background,

class, inheritance, when it should have been merit, effort, and

contribution to the community. So in the interest of opportunities

for all our children and the health of our economy, I want Britain]

to move from the closed society it has been to the open society it

can become.'

But it hasn't happened. The evidence is coming in that under Gordon Brown all progress on opening up British society appears to have stalled.

Indeed, it looks as if the position may have got worse. For children born in 1958 the sons of the richest 20% of parents earn 15% more than the poor sons. For children born in 1970 sons from the richest 20% earned 37% more than sons from the poorest 20%.

The Government's own figures show that despite all their best efforts they haven't had much success in tackling the problems of persistent poverty. I am not blaming all this on the Labour Government. It is a problem of successive governments. It is relatively easy to spend a lot of money to boost the income of the poorest people. In fact with the increases in spending on welfare benefits and Tax Credits under this Government it would be extraordinary if there hadn't been some increase in the real incomes of the bottom 20%. But it is much harder to open up British society so that people genuinely feel that it is open, meritocratic and mobile. There are still far too many people left behind. That is the challenge I want to talk about today.

We face nothing less than a savage cycle of deprivation. It starts with a paradox. Our society became more mobile so some people were able to escape from tough areas. They bought their way out. As a result they have left behind areas of deprivation which have even less of a mix of incomes, classes and generations than before. That in turn makes it harder for the next generation. In the less advantaged areas there are fewer opportunities for children to get to a school with high academic standards than ever before.

Who your parents are matters as well. Another apparently liberating social change has widened the gap between haves and have nots. More women go out to work and earn a decent income than ever before. Well paid women marry well-paid men - what the sociologists call assortative mating. They can afford childcare, even if their relationships break up. But less well paid women marry less well-paid men, so that the gap in household incomes gets wider. If those relationships break up then the lone parent can spiral out of the labour market altogether. The prospects for child raised by a lone parent who is not in a job sadly just aren't very good. This is especially true for daughters - if they don't see their lone parent in contact with the labour market they are much more likely to become teenage lone mums themselves.

Out in the jobs market returns to skills are higher than ever but if you haven't got any skills, you have only got a relatively low level vocational qualification, then your pay prospects are pretty bad. You are competing with migrant labour coming into Britain on a larger scale than ever before and driving down your wages. Then there is the scandal of NVQs. NVQ Level 2 takes about 2 years to achieve. The evidence of the ineffectiveness of NVQ Level 2 is absolutely devastating. It suggests that getting this mainstream vocational qualification does not increase your wages at all. In fact the researchers at the IFS found that people with NVQs at Level 2 actually have lower wages than otherwise similar individuals who lack NVQs - estimates varying the effect from 5% to 20% lower wages. This is particularly true of people who receive government training programmes. It looks as if getting the main vocational qualification actually lowers your earnings compared with people who don't get it.

House prices have gone up massively so unless you are a two earner couple, both of you earning a decent wage, it is hard to get started on the housing ladder. Increasingly home ownership is reserved for the rich and the old. And of course even then many children need the help of their own parents to get started. 55% of home owners expect to give financial support to their children to help them to buy their first house. The private rented sector is expensive and fragile so you end up in social housing, and once you are in social housing it is incredibly hard to get out. One estimate was that in the year 2002-2003 of several million families in social housing only 30,000 moved out. Social housing is difficult to get into but once you are in it is hard to get out. One survey showed 80% of people wanted to be owner-occupiers and home owners are happier with their housing than tenants.

All this means that it is much harder for men in these areas to offer what women have traditionally expected of a husband - a reliable job, a home of your own, a decent income. In the words of one American sociologist, there isn't a "marriageable pool" of men in these areas. So there is nothing worth waiting for. You can't save up to buy a house, there isn't a man you want to marry, you can't earn a decent income with your qualifications. You might as well get on with it and have kids. If in the rest of society childbirth is being delayed, in our deprived areas its mothers are as young as ever. If you compare Britain with other advanced western countries you see this very clearly. We have more women delaying childbirth until their thirties than most other western countries. But we also have more teenage mums. This tells us what a divided society we have become. Modern life has indeed slowed these big life events down for the majority, but for a minority it is all happening as rapidly as ever. Sadly, we know that the outcomes for the children of a teenage mothers just aren't likely to be very good, so the pattern of disadvantage goes on from generation to generation. This is deeply wrong. It should not be like this. We really must not tolerate it. People in our poorest areas share the same aspirations as the rest of us. But they don't have the easy route maps for achieving them. In fact failed public policies have made it tougher for them than anyone else.

These are the problems of our poorest areas. I have only sketched out a simple account of the problems of our poorest areas. There are people here today at the Child Poverty Action Group who have studied this much more carefully than I have. But surely the picture is recognisable. Any political party that is serious about social reform and serious about social justice has to commit itself to tackling these problems with energy and vigour. Of course the most important reason is simply a moral one. If we believe in One Nation, if we are committed to recognise what we share with our fellow citizens, then we can't allow millions to be trapped like this. But it is worse than wrong, it is a mistake. These pockets of deprivation are a waste of talent that the country cannot afford.

Perhaps I can add one other argument, which is especially relevant for my own Party. We are very keen on what is now called localism. Ten years ago I called it Civic Conservatism. It means giving more power to individuals, local institutions, and local councils. In fact recently there has been a proposal that local authorities should become self-financing, drawing their revenues from sales tax. There is also a lively debate about opening up the delivery of public services to private providers, be it in schools, hospitals, or elsewhere. There is an exciting agenda here. But we have to recognise the biggest single barrier to implementing such an agenda - the sheer diversity in our country. We are never going to get self-financing local authorities when Surrey is so much more affluent than Haringey. That would mean localism just perpetuates the unacceptable gap between areas. If we want more localism we need to tackle the plight of our poorest areas.

When we have gone abroad and looked at alternative models of delivering public services people have come back with fascinating evidence about independent hospitals delivering tax financed healthcare in The Netherlands, and independent schools delivering tax financed education in Sweden. I have noticed a clear pattern. It is the countries that are relatively small, and at least until recently, homogenous, with relatively narrow income differentials which seem to be best able to tolerate diversity of supply. If people are already sharing much in a cohesive society then they are happy with different providers. But if it is a very diverse society with a patchwork of widely different cultures and income levels then people may be much more wary about what they fear, right or wrongly, will be further fragmentation. That is why private delivery of education under contract has made less progress in the USA than in Sweden. Again there are lessons here from which we in the Conservative Party must learn. There is a legitimate role for government in defining and shaping those things that hold us together.

What We Must Do: Six-Point Plan

So we need an ambitious agenda for making Britain a better society and that involves tackling the worst areas of deprivation. I believe we can do it. It means investing above all in capital. It means the social capital of the environment and the culture of a place. It means the human capital of people's skills and attitudes. And of course there is also the financial capital of just the amount of money they have got. Put all that together and you really are harnessing traditional Conservative beliefs to create a more just society. Let me just sketch out six elements of such a programme.

For a start we should look at the age mix of these areas. 'Lord of the Flies' is all about the collapse of order when children run amok without adults. There is clear evidence that you need more adults than children in an area if you are to maintain any semblance of order. Overall, of course, Britain is an older and mature society - 12m children and 48m adults. But in our poorest estates it is very different. This is because of the way housing is allocated and the breakdown of the family. There are more children than adults. There are very few employed men or grandparents. We need a radical change in the way in which social housing is allocated and housing developments are planned. At the moment we are creating extraordinary concentrations of children with demographics like the most turbulent countries of the Third World in a mature and ageing society. This is a serious failure of public policy.

Secondly, I believe our housing policies are driving the fragmentation of the family. We just assume the households are getting smaller and smaller and as a result Government policy focuses on getting builders to build smaller and smaller houses and flats. But it has reached the stage where cramped accommodation is driving the fragmentation of the family. It makes it harder to care for a frail relative or help out your daughter if she has a child. If there is one single change that would transform the qualify of life of the people I represent, living on one of the country's largest council estates, it would be if every unit of social housing was built with an extra bedroom.

Thirdly, we know that people in our poorest areas often have complicated personal problems. Standardised state services are not very good at helping them. We need much more imaginative ways of harnessing the voluntary sector which is so much better at helping the whole person. Yet I hear all too many horror stories from the voluntary sector about how they are treated. I think of the centre for rehabilitating drug addicts which was faced with losing its housing benefits. I think of the voluntary sector providers who are so much more effective at helping people into work than conventional Jobcentres but can't get contracts under the New Deal. I think of the inspiring programme for getting teenagers back on track, far more effective than conventional prisons often are, but which finds it very hard to get the long-term contracts it needs to be viable. I think of the voluntary groups defeated by the sheer complexity of the process of bidding for penny packets of money. We want above all solid, reliable, unexciting core funding for the valuable activities they undertake.

Fourthly, there is the disaster of our Tax Credits which have brought new uncertainties to the finances of families. Once again it is Gordon Brown, with this obsession with complexity and tinkering, who is responsible. That is why last year I called for am amnesty in reclaiming the first year's over-payment of Tax Credits. It looks as if that needs to be extended for a second year as well. There is no point in a system that tries to change people's entitlement after small changes in their circumstances. Instead, payments should be fixed for longer and require fewer changes as circumstances change. Indeed, families who may anyway have unstable financial affairs find that inept Government policies have made this turbulence even greater.

We need to reform training as well. That scandal of the useless NVQs needs to be tackled. We know how it can be done. The NVQs are far too paper based. They should once more be practical and useful, with much greater involvement of employers.

We need to help people build up their financial capital. That is where the Lifetime Savings Account comes in. Instead of expecting people to save for the distant prospect of a pension without being able to touch the money for 35 years, we should have much more flexible ways of encouraging people to save, and enable them to access the money earlier if they wish. That is a far better way of helping people to build up real savings that they can use to get some independence.

This adds up to an agenda for spreading capital more widely in all its forms. We should strengthen social capital by reversing the damaging policies that create concentrations of youth and disorder and weakened families. We should strengthen the human capital that gives people hope of a decent job. And we should spread the financial capital that gives stability and independence.

Conclusion

The next election could well be called in 2010 - after all, Labour won't dare call it in 2009 if they are behind in the polls. And at the next election we should be offering a picture of what we can achieve for our country over the coming decade - our 2020 vision for Britain.

Our opponent is very likely to be Gordon Brown. He is the one who has dominated the political debate for a decade. It is he we must hold to account for the failures of his policies - from tax credits to pensions. It is a better alternative to Brown's Britain that we must articulate. We can already see how our vision can rival his.

Instead of tackling the big problems today, Gordon Brown is shifting all the difficult decisions and the debt to financial spending on to the next generation. In fact I sometimes fear that as class war disappears from British politics then generational war could replace it. This shifting of burdens from one generation to the next is a threat which links our critique of this Government's economic policy with our belief in a cohesive society.

One of the great strengths of the Conservative tradition is that we understand the ties and obligations that link us across the generations. Economic policy should deliver equity between today's and future generations. Or, to put it rather more poetically as Burke did, the state ought to be "a partnership not only between those who are living but between those who are alive, those who are dead, and those who are yet to be born."

This same principle applies to social policy as well. Surely one of our deepest desires is that we should pass on values and principles from one generation to the next. The dominant way of thinking about British society now is to assume that we are fragmenting into atomised individuals with much weaker ties across the generations. Nobody appears to dispute this model, it is just that Conservatives can't appear to agree whether this is a good thing or a bad thing. Fortunately, the truth is that we still have a powerful sense of obligation across the generations. The majority of adults with a surviving parent see them at least once a week. In fact, my personal account of how I have come to understand Conservatism is as a free marketeer with children. So far in this debate no-one has provided a vision or a policy platform that is coherent or strong enough. Over the coming weeks and months we must all do better and raise our sights to offer a compelling vision for the future of our country.

There are too many parts of our country where people have been left behind, they don't participate in the lives that the rest of us enjoy. They too must share in our vision of a better Britain - otherwise it won't have real meaning. It is such a vision that I believe we must offer at the next election. We must set out an alternative to Brown's Britain."

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