LR: Could you describe the liberal project without using any jargon?
NL: For me it’s fundamentally about giving power to people. It applies in all sorts of settings. I describe it by way of giving examples. In the way that citizens receive public services, you can choose to give power to people or to the institution. So in health, for example, you can give people a personal health budget, in care you can give people what’s called a personal budget, you can combine the two, ideally, for people who are receiving both. If you look at different public services you can apply similar sort of approaches. In the workplace you can give me people a stake in the organisation where they work. And actually the principle can apply in both public and private sectors. Incidentally, that’s one of the big opportunities, for improving productivity in the public sector, [is] to give people a stake in their organisation or enterprise. You can do it in housing, by giving tenants control of their housing block or their street or whatever it might be. You can do it in communities, whereby the council can choose to just dictate what happens in a community or you can give people in that community the right to decide things for themselves.
Then, of course, in terms of your legal rights. This for me is at the heart of everything that I’m about. So when it comes to that moment when you yourself say I want to bring an end to my life because I’m terminally ill or I face some impossible condition, should it be me or the state that decides, well I want the power to decide that. Should it be me that decides whether I smoke a joint, or should it be the state that criminalises me? It should be me that decides. The state has a very important role to educate.
So in every sphere I think there is a liberal view that we should be trusting in people, giving power to people, in every aspect of their life, whilst at the same time, critically, recognising that each of us has a responsibility. With freedom goes responsibility — and I don’t think the party talks enough about that, actually. That’s not responsibility imposed from on high, other than when you do something that affects somebody else adversely, which is John Stuart Mill’s recognition, that the state can intervene. We recognise that often we work better together in communities, whether it’s physical communities, or electronic, cyber communities. And indeed the principle applies to the stewardship of our planet and our responsibility to future generations, and indeed to try to address the need for empowering people globally, so we work with other countries, we have a responsibility to seek to do that. That, I hope, has gone some way to defining my liberalism without using jargon.
LR: A lot of the debate on people who have problems with gambling, obesity is couched in terms of the effect that has on your family etc.
NL: Well I read on the bus this morning [about] your ‘four corners of liberalism’. I did note in the opening section that you recognise that the tax system can be used to encourage broadly positive things and discourage negative, damaging things for society, and I do buy into that. So the tax system, we already recognise, can be used to achieve environmental advances, but I think it can also be used, without prohibiting the smoking of cigarettes or the drinking of alcohol, for example, it can be used to have an impact on behaviour, because we recognise, if we think about the NHS, for example, there is a consequence for the NHS, and therefore for everybody in terms of cost, if we have an obesity crisis, for example, or if we have massive problems with alcohol abuse. As a society we have very much double standards. We go for prohibition on a certain number of defined substances, and then we have a free for all, and object to any constraints or regulation on other substances, which may well be more dangerous. It’s ridiculous to state a very strong liberal position about not taxing sugar or resisting a minimum price for alcohol, or resisting plain packaging, when if you don’t at the same time have anything to say about the criminalisation of tens of thousands of people for smoking cannabis, or for taking another drug.
LR: What is the role of the state in protecting people from themselves?
NL: I think the state has an absolute role in educating. And so, for instance, in Colorado, my understanding is that where they have legalised cannabis and regulated it and now take tax from it, rather than the money going to criminal networks, they use some of that tax take to educate on the dangers of drugs. That, to me, is a much more rational, liberal position to take than prohibition. And equally, in the NHS, there is an emerging, I don’t think crisis is too strong a word, actually, over obesity and diabetes, and we see a proportion of a whole generation, of children growing up, I think one in ten are obese before they get to primary school and one in five are obese before they get to secondary school. The health consequences of this, and the impact on people having a happy, good life is overwhelming, the impact on their life chances is enormous. So surely the state has a role there to warn of the risks and indeed sometimes to nudge, to encourage, the sort of behavioural economics — I don’t have any difficulty with adopting that sort of approach.
LR: What do you understand by the terms left and right in politics, what do they mean to you, and what do they mean to the party?
NL: Well I think they can often be horribly misleading and I never quite fully understand where a radical liberal comes in that spectrum. Lazily, I’ve always seen the Conservatives as the opposition and Labour as the competition, because I think that for my liberalism I don’t see a conflict between economic and social liberalism, but I am driven by a sense of social justice. I really struggle with inequality of opportunity — so many children in our country who do not have the opportunity to make the most of their talents — and I also worry about the absolute gap between rich and poor. I don’t think it’s a healthy society when you have an ever-growing gulf between the super-rich and everybody else, and between the super-rich and people who are totally left behind, and if you are enslaved by poverty, poor housing, or whatever it might be, then you don’t have the chance to make the most of your talents, or to live your life exactly as you want to or to flourish as an individual, so a social and economic liberal needs to recognise that. I suppose broadly I would put myself on the centre-left, but I do that because I think that the things that drive me are injustice and inequality, along with the freedom of the individual to lead their life as they want to lead it. And the final thing I would say is that I think sometimes “left” is associated with statism and conservatism, and that’s totally not where I’m at. There are people on the left who, and this cuts across the parties, end up in a position where they almost end up defending the status quo: nothing can change, resistance to reform. And as a liberal I am always impatient for reform, I want to change things to make things work better, to address the failures of the state, particularly in terms of poverty and delivery of public services, which always let down the most vulnerable most — because always people with money can find other solutions, whether it’s health or education, or keeping themselves secure. So I find myself in total resistance to that leftism that is associated with statism and conservatives, that the state always does things better than anyone else. I liked Paddy Ashdown’s description of the enabling state, where the state guarantees outcomes and results for people, but co-operatives, mutuals, social enterprise and sometimes the private sector can sometimes do things better. It’s not ideological — I don’t really see it as an ideology to say that the state has to do everything.
LR: If people out there are thinking, how left wing or right wing am I, and how left wing or right wing is this party, how do you break through that?
NL: My preference is to describe us as a progressive, liberal alternative to the Conservatives and to distinguish ourselves with a Labour Party that’s an anachronism, that is still linked to organised labour — and none of the leadership candidates are taking that on — and that’s not to say there’s not a role for organised labour, there totally is, but it’s not linked to a political party. And still too much linked with the state. Now I found myself in the health context, in the last parliament, where Liz Kendall was my opposite number, in private discussion often finding ourselves in agreement on things — she’s a great believer in personal health budgets, for example, giving power to people in receipt of public services. So it will be interesting to see what happens on the Labour side.
LR: How do we settle the internal debates within the party as to where it feels we should position ourselves, and what we feel our attitudes to the state. How if at all are we going to settle those debates within the party?
NL: Well it’s interesting that Andy Burnham’s constant attacks on anyone else doing anything else within the NHS didn’t secure great electoral advances for the Labour Party. Incidentally, I absolutely do not want a wholesale shift to the private sector in the NHS, I think that would be a big mistake, but I don’t believe the state has to do everything, because it doesn’t always do it best. In terms of how we define ourselves to the public, I think we have to be seen as an alternative to the Conservative Party, but I would prefer to use the terms progressive and liberal rather than left-wing. You know, the irony for me is that at a time when the liberal voice has been crushed, massively diminished, actually in very many respects we’re in tune with a great chunk of the public, who support us on the social liberal agenda, the greater freedom for people to make their own decisions about their lives, who actually want some economic discipline but don’t buy into a sort-of right-wing agenda. There’s enormous scope out there to talk to the millions of people who effectively share our values to a greater or lesser extent and convince them that we’re the party that speaks to those values.
LR: What lessons can we learn from the coalition, both positive and negative?
NL: The first statement I’d make is that the only reason I do this job is to advance the things that I believe in, which fundamentally I believe in because I think [they] achieve better results for people, making a difference to people’s lives. And I often think that you only do that if you get into government. We spent most of the post-war period commenting or sniping from the sidelines, but not actually advancing the things we believe in. So I don’t resile from going into coalition, I think it was the right thing to do, and I won’t ever take a different view.
But what did we do wrong? We lost trust first of all. And we can seek to understand the process that led to the breaking of the pledge, but the bottom line is we broke trust, and I think once you are defined, fairly or unfairly, for having broken trust, people stop listening to you. So I think that was a fundamental problem. I think from the start, I totally understand why Nick wanted to demonstrate to the public that coalitions work, because the whole narrative in the 2010 election was that it would all be a disaster, but I think ultimately it looked too cosy at the start. It should have been a much more professional relationship: here are the things that we will try and do, we will fight for these all the way through this parliament, we will sometimes have to make compromises, we will tell you where we are making those compromises, and where we achieving liberal objectives and why we might have compromised on something to achieve something that we believe in. So if there was a consistency of approach all the way through, then I think we might have stood the chance of a better outcome. But the fundamental problem, I am convinced, is that a third party, unless it’s regionally based, where there is a power base, where people vote for you because they are voting for you, but a third party where you’re having to win seats but persuading third party voters in your seats to vote tactically, there is a massive risk, and I think almost a near certainty, that going into coalition results in that tactical vote unravelling. And it wasn’t just that it went back to Labour, but it went to Greens, it went to Ukip, it fractured. No small party, not just the Lib Dems, is going to risk coalition under first past the post, and I wouldn’t advise it, so I would say it has to be a condition that you change the system. And I think the interesting debate during this parliament is where Labour goes. And the critical question will be, will Labour conclude at some point that it’s in their self interest to change the system.
LR: So are you saying you wouldn’t go into coalition unless PR was firmly on the table.
LR: And what can we do to get electoral reform back on the table?
NL: We have to build alliances. We have to work with others, and Ukip are pretty angry that they have been cheated, and they have been cheated, and in my view it would be ridiculous to say, “Well they’re Ukip, we disagree with them on most things very strongly so therefore we can’t work with them”. We have a common cause, actually, in breaking a corrupt system, so we should work with them, we should work with the Greens and indeed Labour people who share our view. And I think we should explore the idea of a constitutional convention of some sort. I don’t know whether there’s a sufficient, broad consensus that change is needed amongst civic society, because at the moment it is the minor parties, ultimately, that are complaining about unfairness, and the Scottish situation was different [when PR was introduced], because you had a wider consensus across much of society that things had to change. But I come back to the point that I think the debate within the Labour Party — and we should seek to influence it, we should be talking to Labour people — that will be the critical thing. We should explore a broader coalition of interests, but ultimately if Labour came on board then everything changes, and there would be a non-Conservative consensus going into the next election that things have to change. But that’s a big if, and it’s impossible at this stage to judge.
LR: With the SNP dominance in Scotland, how do you see the constitutional future, and what will be the effect be in England?
NL: Start with the principle, and it goes back to my starting point about where power lies. In the United Kingdom, power lies very much in the centre, and I think in a way that has generated the support for nationalists, because it’s a demand for self-determination and hating the remote power, as it where. The critical thing is where money is raised, because that’s where the power lies. You can devolve responsibility for running services, but unless you devolve money-raising you still have a dependency culture, and I think we have a massive dependency culture in this country. My county of Norfolk, they want to do something innovative, they want to perhaps make a big investment in education — we’re behind the curve on education in our county — something big is needed in Norfolk to turn the dial, to really want to make Norfolk a leading county in education, and there’s no reason why it couldn’t be, and part of that must be an investment programme. Can we do it? No we can’t, because we make our bid to government and they say no. You can do it at the margins, through council tax, you could have a referendum to marginally increase council tax. I believe, again as a liberal, that we should be enabling people in their communities to have control over their destiny. In Sweden, few people pay national income tax, because if you’re at the basic level you’re paying your income tax to your county rather than to the state, and it seems to work quite well there. So I would want quite a radical decentralisation of tax-raising powers, not only to Scotland, and not to England, because the difficulty we have in the United Kingdom is that England dominates so substantially that it’s unbalanced — there would still be a feeling of total remote power if you just said England had devolved responsibilities. So you have to devolve to the counties across England responsibility for so much more of our day-to-day lives, and I think that in effect is the answer: a much more devolved, federal type of state.
LR: How do we settle internal debates without tearing the party apart?
NL: Well I just think through the power of argument, and through being reasonable in the way you make your case. I don’t think the solution can be that we just fudge everything. But I genuinely believe that we create false divides often. And then we categorise people as on the left or right because they happen at that moment in time to be arguing an economic case, perhaps. I did the work on Royal Mail, as the Shadow Secretary of State for Trade and Industry, arguing that there should be private investment, but critically that there should be employee-ownership, so that probably more than anything else categorised me for some as being on the right. I just think that’s completely ridiculous, because it doesn’t make me any less committed to social justice, or to combating disadvantage or poverty, but it’s [about] how you run services that have hitherto been run by the state.
LR: It does seem that there is an “economic exceptionalism” with some in the party — where people accept liberalism in every sphere, but then become worried about it when it comes to economics. How do we convince people about the benefits of economic liberalism?
NL: Well, I suppose some won’t be convinced, but I talk to plenty of people who are in the Social Liberal Forum who describe themselves as economic liberals. And I think we have the debate, we make the argument. And sometimes there will be conflicts, I don’t deny that, but I think that if its articulated clearly, with a very strong recognition of the need for us to be more clear about how we combat disadvantage and poverty, particularly entrenched poverty and disadvantage, then I’m a firm believe in the power of being able to take people with you. But it’s about arguing the principles of the philosophy, rather than having sort of trench warfare on particular policies. If by everything you do you end up defining yourself as being on the right in your attitudes — a lack of interest, for example, in combating disadvantage — then of course you will create a whole load of enemies within the party and you will get nowhere. But that’s not what I’m about. It’s fundamentally not what I believe in. There are some people who think it’s what I believe in, but it’s just not me. For some I’m simply condemned because I was part of the government: a decision we voted for democratically as a party. So, I recognise there are some you will never convince, but I think actually if you’re reasonable and if you demonstrate [your beliefs] to people. So I think this is a good example — I think with many people on the left of the party, they have been — and it sounds like I am singing my own praises — but they have been inspired by the work on mental health, and when Naomi Smith, the head of the Social Liberal Forum, came to see me, she said, “This speaks to our values. This is persuading people who had left the party come back again”, and I think you can win people round to a consistent liberalism if you demonstrate to people what your values really are.
LR: How do you reconcile the belief in localism with the desire to impose liberal policies – e.g. same-sex marriage in Northern Ireland.
NL: The absence of same-sex marriage in Northern Ireland conflicts with my view that everybody should be treated equally, and should be able to love and marry who they want. In our system they are able to make those rules, but it doesn’t mean I can’t campaign to persuade them to change it. In fact, I would be very happy to campaign with others in Northern Ireland to make the case for a liberal reform to the law there, just as I welcomed the Republic of Ireland going down the same route. The same conflict sometimes applies in the NHS, and the whole postcode lottery type of argument. My response to that is, I think it’s legitimate in a National Health Service, which I’m committed, to say let’s set standards of quality and access nationally, so that we say that wherever you are in the country, you have a right, if you have a mental health condition, to timely access to treatment wherever you live. But it’s up to the local area to develop their service as they see fit to achieve those objectives. And I don’t see a conflict in that.
LR: So should Manchester, for example, be able to change those policies?
NL: I would want a floor. I’m very keen on devolving responsibility in the NHS to run services and to develop a coherent merger between health and social care, and all the rest. But I do think that there should still be a guarantee that you should get access in Manchester if you suffer from a mental health problem. They can do whatever they want to improve that access, and to make it much better, but I think that there is a role for a national standard of access.
LR: Isn’t there a danger that those minimum national standards become effectively the level of provision, and devolution is then not real?
NL: Well, you can take a purist’s view and just say we devolve all responsibility, and we impose nothing in terms of standard of access in the centre. I take a pragmatic view here. I totally accept that in applying your values you sometimes get conflicts between those values and principles. It’s a very strong principle for me that whoever you are, whatever your illness, you should have the same right of access and treatment. And so if you devolve all responsibility and you don’t enshrine that principle in law, you’ll get a situation in many areas of the country where people don’t have that right. Now that principle conflicts with devolving power to communities. And we just have to be honest that sometimes principles come into conflict, so I think the logical settlement of that conflict is to say that there’s a standard. And I understand your theoretical argument that it becomes a race to the bottom, but I know the reality of the NHS. The pressures are so enormous that you just have to have minimum standards.
It is quite interesting, when you become a Minister and you’re on a mission, I’ll give you an example. The scandal of thousands of people ending up in police cells, with a mental health crisis, for me that’s intolerable in a civilised society. So I was totally driven to get the numbers down everywhere. We did it by way of a crisis care concordat, so we got every area to draw up their own plans for how they were going to achieve it. But we were very clear that the standard must be that people are not going into police cells. But the temptation is to become Stalinist. I was so driven by the moral imperative of ending this scandal, that you want to just say: “Just do it!”.
LR: At some point in the next parliament the books will be balanced and a surplus is planned. What do we do with that surplus?
NL: First of all, incidentally, I don’t agree with George Osborne legislating for a balanced budget. I think that’s ridiculous. It’s showy politics, and also somewhat irrational. We were right to try to get the public finances sorted out, but this is an era of historically low interest rates, and the Tories now have an obsession with clearing [the deficit] and creating a surplus, but at the potential expense of highly vulnerable people and public services.
I think there is a tension in our country that we want — and this is an often-repeated mantra — that we want Scandinavian standards of public services but US levels of taxation, and there’s a tension there. But I know that the health and care system is pretty much on its knees, for example. Germany and France — not ridiculous countries, sensible, rational democracies, on the whole — they spend about a third more on their health systems than we do.
LR: They also don’t have a national health service.
NL: No, they don’t. There’s a different mix of public and private contribution. But the bottom line is that they end up spending more. I want to change the way the NHS works, in terms of that transfer of power to people, but I’m not convinced that there’s any overwhelming argument for shifting to a different system. Actually, the Commonwealth Fund was quite clear, for example, and I don’t suggest that it’s the only fountain of wisdom, but it said that the NHS compares favourably with most other systems.
The bottom line is, I would not be just giving it all away, the surplus. I absolutely don’t believe in taxing for the sake of it, but I do believe in having good public services, and I would be heavily investing in education, and in the early years — that’s the critical thing that dictates or determines disadvantage. But I would also be addressing some big infrastructure issues. I would, for example, just use government power, because they’re the only ones probably who can do this, to insulate every home in our country. We have the worst-insulated housing stock in Europe. It’s totally inefficient. We would end up with the equivalent of a tax cut for every family, because they would be spending less on their energy, we would be achieving a massive saving on carbon. It’s what government can and should do. I would make every town and city cycle-friendly. Again, it would be a massive public health gain, it would be again a big saving on carbon and also on pollution. We’re miles behind Denmark, Holland, Germany, France. And then broadband. There are big infrastructure things that we need to do, which we should be spending money on.
LR: In terms of the role of the state vs the private sector, what should and shouldn’t the state be doing? What ought to be privatised/nationalised?
NL: I have given one or two examples of where the state can intervene. I think also the state also needs to intervene on housing. It could directly commission construction on vacant public land and either do or facilitate the renting out on a market rent which would significantly increase supply. There’s been a market failure there. That’s where government can very sensibly in the modern world intervene. At the same time, incidentally, I would have a punitive tax rate on properties in London where people buy them for investment only and just leave them empty, because I think that’s intolerable when there’s such housing strain and stress in London.
I think we were absolutely right to make the case for Royal Mail [privatisation]. It is ridiculous that a company that will more and more be a parcel delivery service to be a state-run company. But then there’s the whole array of public services. For me the liberal vision is not just to transfer to the private sector, but it’s the emergence of social enterprises and mutualism, and I think this is the potential big prize in enhancing productivity, in improving quality of life, the wellbeing of people who work in our public services — many people in the NHS feel put-upon from on high. You would think it was this great paternalistic, good employer, but often it’s not. All the examples of community services and social enterprises with people having a stake in the organisation, they have all been successful, there are no failures. And I think in a way it’s an attractive liberal position. You’ve got Labour on the one hand who are conservative in just defending the status quo. You’ve got the Conservatives, many of whom see no social purpose or no public service ethos — they don’t recognise the importance of that. I think this is the liberal alternative of liberating staff, giving them control and sometimes also looking at ways of giving the consumer, the citizen a stake in the organisation as well, so I think this is the liberal vision we need to develop.
LR: What are we going to do with all these new members? Particularly now we’ve got only 8 MPs and there are whole swathes of the country where there’s no activity.
NL: You can be active online, that’s one thing. Not just in communicating and discussing things, but also in the development of policy. I think our party needs root and branch reform in the way it runs. We’re stuck with a constitution designed in 1988 or whenever as a compromise between two parties, we tie ourselves up in knots, there are lots of committees. I don’t begin to understand the structure of the party and I’m standing for the leadership. I’m quite sure that no new member does. And this idea that you have to be elected to something to get into the pool that becomes the pool for franchise for another set of committees, that’s just awful. In my view that’s all got to go, and we’ve got to have one member, one vote. But surely we could find ways at our conference time of ensuring that every member can participate electronically. I know there are complications, and I know that you’ve got to work through how it would work, but [it’s right] as a principle. And it could be made a perfectly reasonable income generator — everyone can buy into an electronic participation, and everyone can vote online. Demonstrating to new members that they can have a role in policy making, as well as in other areas of discussion, I think is really important. But then also there’s a responsibility on us here to get out into the country and to engage with people and make them feel part of something that’s worth being part of.