Ed Balls' speech to Labour Conference

Ed Balls spoke today about the need for credibility in economic policy and a plan for growth.  The speech represented another step in the right direction for Labour - another step on a long journey.

Balls referred to the current economic and financial crisis hitting eurozone countries.  He talked about the need for growth.  He talked too about the need to control spending - and while in opposition, spending pledges.

I think we should go further, and have an Effective Spending Guarantee, with independent assessment of spending pledges to ensure they can only be sustained if they actually work and are value for money.

Balls made a welcome commitment to look into the case for a national investment bank for small businesses.  We should get on and work up proposals for this. The issues are how it would work and how can we make any proposal bold enough?

There were some welcome points on financial reform too, including tackling short termism.  I think we should go beyond the current conventional wisdom about bank reform and advocate separating banking activities.  Labour has more thinking to do on financial reform - it needs to get into the position of relearning to love the City - but a reformed City.

There is still more for Labour to do on the economy.  We need to understand what went wrong. We need to understand how values and priorities got distorted in the years running up to the financial crisis.  We can however start now to think about what a credible, radical, and progressive economic policy should be.  My new Fabian pamphlet, launched today, does just that.  It can be downloaded this week from the Fabian website at: http://www.fabians.org.uk/publications/ideas-pamphlets/the-credibility-deficit

Stephen Beer, 26/09/2011

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