Ed Miliband will set out a new direction for the Labour party under his leadership on Tuesday by saying that the unprecedented and unexpected landscape at the next election will require it to address the deficit and make decisions "all of us wish we did not have to take".
In what is billed as a significant statement of Miliband's position in the light of the government's admission that the deficit will not be eliminated by 2015, he will use a speech to the London Citizens organisation to promise to lead a changed party.
He will stress that the persistence of the deficit does not mean Labour has to abandon its distinctive agenda, but instead rethink it. He will say: "Each time New Labour won an election, we came back to power with a growing economy. Next time we come back to power, it will be different. We will be handed a deficit. Whoever is the next prime minister will not have money to spend. We will have to make difficult choices that all of us wish we did not have to make."
The speech reflects lengthy conversations among shadow cabinet members on whether their economic narrative fits the public mood. In what are described as very direct discussions, the argument was made that the party cannot resonate emotionally with the public mood unless it reflects the seriousness of the deficit.
It was also said that the party could not be seen to be still arguing about whether the government had been right to cut in 2010 when the electorate will want to know what Labour will do in 2015.
Saying Labour needs to rethink how fairness is achieved, Miliband will argue: "The failure of George Osborne's economic policy creates a different landscape for the 2015 general election and whoever wins it. The ideas which won three elections between 1997 and 2005 won't be the ideas which will win the election in 2015. So we will be a different party from the one we were in the past. A changed Labour party."
He will add: "In the short term, where the government is stripping demand out of the economy, we would go less far and less fast. We call for these things not because we aren't interested in dealing with the deficit. We call for them because we are. The sooner growth and jobs return, the easier it is to deal with the deficit we face."
He will set out three ways to achieve fairness in more austere times: reforming the economy to support long-term wealth creation with rewards fairly shared; tackling vested interests that squeeze the living standards of families across the country; and making choices that favour the "hardworking majority".
He will claim: "Everyone is now joining us talking about the squeezed middle, the next generation, and responsible capitalism. But it's not enough just to talk about them. Suddenly David Cameron is falling over himself to say he too is burning with passion to take on 'crony capitalism'. Now he has accepted this is the battleground of politics, I say: 'Bring it on.'"
Miliband is likely to be pressed about how he would rethink Labour's spending priorities, and will face criticism he is too vague to engage the electorate and lift his weak personal polling. In a piece published by the Guardian's Comment is Free, Lord (Stewart) Wood, one of his closest advisers, says that matching the Tories cut for cut or outflanking them on the right would be a blind alley.
But offering status quo capitalism would also be wrong, he says. "For the past 50 years, Labour's approach to governing has rested on using the proceeds of growth to fund redistribution, social protection and public services. In 2012, we know that these proceeds will be in scarcer supply than in the past, and the claims of deficit and debt reduction on them when growth does return will be greater than before."
Wood argues that the deficit Labour inherited in 1997 was 3.4% of GDP, and this year it will be 8.4%. "We'll still tax and we'll still spend, and in straitened times the politics of tax and spend – making sure tax is properly progressive, making sure spending is well targeted and efficient – will become more not less important. But these choices will be tougher. The 1980s supply-side revolution from the right has run its course. What Britain needs is a supply-side revolution from the left. We will need new types of banks and stronger competition in the banking industry; corporate governance reforms to incentivise good ownership models and longer-term business strategies; ensuring that companies see the continuing upskilling of their workers as an obligation and not simply a luxury; and the courage to challenge vested interests in the economy that charge excessive prices for energy or train fares and squeeze families' living standards."
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10 January 2012 12:11AM
FINALLY.
10 January 2012 12:16AM
One reality that Ed Miliband refuses to face is the fact that he will never be Prime Minister.
10 January 2012 12:17AM
Really astonishingly awful headline - deeply misleading about the content of the article and the detail of what Milliband has said.
10 January 2012 12:17AM
I've heard Milliband's rhetoric time and time again, and i am always left with one question -
HOW would you do it, Ed?
10 January 2012 12:18AM
So, when labour start running their next election campaign, presumably their byline will be something like ''see, we're just like the tories really'.
The same worn out conviction that somehow progress entails a reduced but workable version of the present... no attempt to rethink ways of distributing employment, no connection between economics and the environment, but the same hint of malicious prejudice against welfare ...
Truly grim stuff.
10 January 2012 12:19AM
Milliband is lying. The others are lying. He and his mates will not suffer one bit.
10 January 2012 12:20AM
Im sorry but he has to go .
We are going to be stuck with the heartless tory bastards for years to come .
10 January 2012 12:21AM
Ha, ha, ha, ha.
Wails of derisive laughter.
The hard-boiled left, led by Tonybee (et al) will be along in a minute to tell Milliband that he has become a Conservative.
"Deficit"???
"What deficit"?
10 January 2012 12:22AM
The best indication of how he will actually lead the country is how he's leadng his party right now. By the looks of things, we'll not even notice him.
10 January 2012 12:22AM
So what are you going to do ? Spell out what you will change, get on with it and stop avoiding the big issues...
10 January 2012 12:22AM
its all talk, nothing radical, we are not going to win the next election with ED.
10 January 2012 12:23AM
The nu nu labour!
Labour ran budget deficits from 2001 onwards, truly reckless because there were also trade deficits while the savings rate dropped all the way to zero. In addition the tax take was high in those years owing to banking profits and stamp duty on booming house prices. Labour laid the seeds of destruction then (oh, don't forget that Brown and Balls also let UK banks run with half the equity that US counterparts had in their balance sheets).
When Brown and Balls and Miliband left office the budget deficit per worker in the private sector was over 7,000 pounds and the structural component of the deficit 7% of GDP!
10 January 2012 12:24AM
the argument was made that the party cannot resonate emotionally with the public mood unless it reflects the seriousness of the deficit.
Could they BE more out of touch? everyones sick of the bloody deficit, what peopl want to hear is that there is still a left wing party in this country - that Labout genuinely care about peoples lives being trampled on - that the people responsible for this almost feudal margin in income will be punished.
God i hate him - hes just as bloody right wing as his brother, at least if they had voted him in he might have had more balls.
10 January 2012 12:24AM
Fuck sake
mmm Excuse me Ed....
Oh yes previous Chancellor Alistair Darling did have a programme of reducing public sector spending by 5% a yr for the next ten years to tackle the deficit. It would have meant a sensible an manageble programme of cuts. By now we would be looking at 10% cut by this coming April.....
Itw ould have allowed the economy to absorb the reduction in spending on the high street. It would have allowed unemployment to rise a sensible rate, so our public borrowing requirements could be carefully controlled. Unions would have also accepted such a rate of downsizing in the public sector......
But now your trying to look tough on the economy, which after the swinging cuts imposed by this coalition will just suggest to old left wingers like me, your part of the problem not part of the solution......
10 January 2012 12:24AM
Why do they ALWAYS say "difficult choices" when they mean cuts.
We are adults. We can take bad news. Just be honest.
Just tell the truth.
10 January 2012 12:25AM
...and thank heavens i live in Scotland where we have an alternative to Milliband and Cameron.
I'd mention Clegg but he's utterly irrelevant now. Arf!
10 January 2012 12:25AM
I'll reserve judgment before being blindly criticising Ed Miliband like so many people on these pages.
The mood on here is to attack Tory policy on the deficit, but then stay deaf to what Labour has to stay on purpose. 2012 is under way, give the party another chance (as hard as that sounds) because unless you're rich filthy, you are going to be screwed by this government for a long time!!!
10 January 2012 12:26AM
Edd please take it from me ,,go back to the roots of the Labour party you know it start with a S and ends with M and do a 1945 ,ok
10 January 2012 12:27AM
"its distinctive agenda"
hahahahahahahhahhahahhahahahahha
ahahhaha
ahjaha
ha
ha
ha
ha
10 January 2012 12:28AM
So Ed spends nearly 2 years denying the deficit then changes his mind when the polls look bad.
Pathetic.
10 January 2012 12:28AM
How about full employment, Ed?
Or are you just going to continue with the Tory Workfare slave labour?
Yeh, though so.
10 January 2012 12:29AM
He will stress that the persistence of the deficit does not mean Labour has to abandon its distinctive agenda
What distinctive agenda is that then, must have missed something.
Ah ok, I suppose it's being Tory-lite, as different from pure Tory!
Get stuffed!!
10 January 2012 12:29AM
LABOUR, GUARDIAN AND BEEB, THE UNHOLY TRIUMPHIRATE, CALL TRYING TO LIVE WITHIN ONES MEANS AUSTERITY!
10 January 2012 12:29AM
Watched this person when I was back in the U.K. last year and watched the Labour Convention on TV. Reminded me of Tony Blair. Is this what the Labour Party needs? I don't think so.
10 January 2012 12:30AM
This is PATHETIC !!!!
How about an actual idea ?
The Labour Party are the opposition and are utterly clueless.
I despair !!
10 January 2012 12:31AM
It's difficult not to criticise him when he gives very little detail and all we get is vacuous rhetoric.
If he spells out HOW he plans to implement these ideas then many people may be more inclined to back him. Up until this point, i'm afraid, we've seen very little in the way of real substance. As such, i, like many others, remain utterly unconvinced.
10 January 2012 12:31AM
This must be one of the worst examples of journalism.
It reads just like a press release from one of the main parties.
Where are the newspaper editors these days?
10 January 2012 12:31AM
rflmao
Yeh, kick the poor and waffle on about 'the squeezed middle'.
Does he think we're too stupid top notice this is the same dross both parties have been pumping out for the last 30 years?
10 January 2012 12:33AM
Fairness by nature is a process, not a "thing", an "object". We have a process of fairness, it's called democracy. This latest attempt to marry an unfair anti-democratic system such as capitalism looks like another go by a major party at capitulating and pleasing the markets at the expense of society.
10 January 2012 12:33AM
Does he really really believe anyone gives a **** about New Labour?
Does he ever venture outside Westminster village and its media enclave to talk (and LISTEN) to real people?
Not a word about the kleptocracy in the City, not even a word about how capitalism works in countries that didn't go follow the Thatcher/Reaganomics recipe for disaster?
Just go, Ed. Do it now, voluntarily, before the trade unions publically admit that their money is backing a losing horse and you have to go for the sake of the party. You're looking tired, Ed.
10 January 2012 12:34AM
Why o why can't this discussion focus on the real issue which is revenue and the means of dealing with this deficit? The cuts themselves seem ideolocically driven and if we went back some 30 odd years we would probably have a chancellor who would have looked at taxation as a means of resolving the issue.
We need a debate about what society wants to pay taxes for. People in Scandinavia are happy to pay taxes knowing that they get something for those taxes.
That does not mean discrimination against most ordinary people by punitive taxation on petrol and diesel - this taxes jobs and mobility, as the experiment of the last 20 years shows.
Get it right - it's time to tackle the rich - everyone from the 'companies' based abroad who 'own' houses in london (and avoid the taxes that residents have to pay); and then on to the banking mafia who have been holding the country hostage.
Let's hear the pips squeak.
10 January 2012 12:34AM
Labour Implodes.
10 January 2012 12:36AM
I might begin to back him more if he had an article in something like Tatler magazine, telling their readers they're going to have to accept cuts to their lifestyles.
10 January 2012 12:36AM
In any case, it seems that whoever you vote for someone from Primrose Hill is going to get in.. "rubbish"!
I wish I could vote SNP!
10 January 2012 12:37AM
correction - ed miliband told to set out new direction.
ed is incapable of thinking for himself, only reading what the spin doctors and unions shove infront of him in the most nasal, robotic form possible.
for the love of god, ed please go and let someone else really take the fight to the tories. under you we're looking at an independent scotland and eternal tory daily mail land.
10 January 2012 12:39AM
I think Ed has hit the nail right on it's head. They were given a growing economy in 1997, and left it spiralling out of control.
Good use of statistics. The problem is that the deficit is just the amount of debt that is added to the total national debt. When you give figures out like 3.4% and 8.4%, to the average citizen it doesn't sound like a very huge problem, until you actually see that the total debt accumulated by the UK is at around 2 trillion pounds, which is what we're leaving behind for future generations to pay.
10 January 2012 12:41AM
This does sound a bit like one of those deeply patronising "nanny knows best " speeches Patricia Hewitt and Tessa Jowell used to like to make to conference.
The fact is, the public don't think Labour spent too much , they think they wasted too much- throwing public money around like confetti. It's an important distinction to make, as one can be rationalised away, the other just looks like pure incompetence. Ed needs to face up to that before promising more spending.
10 January 2012 12:42AM
I know you wernt media trained and abit of a handful but god i miss you Micheal Foot
10 January 2012 12:44AM
Why waste time even reading about this useless outfit?
I think it is time the UK electorate started supporting the GREEN PARTY who have a genuine interest in working for the good of the people and for the environment.
10 January 2012 12:47AM
Cameron Lite
10 January 2012 12:48AM
"We will have to make difficult choices that all of us wish we did not have to make...choices that favour the "hardworking majority" #spartacusreport
Still at it Ed Case? You're such a wally! Off with your Ed!
@blacktriangle1
10 January 2012 12:49AM
The current Labour Party and its leaders are a disgrace to the principles the party were originally founded on.
If Ed Miliband came out and said he was going to:
1. Re-nationalise the transport system.
2. Tax the rich and the banks.
Then he would win the next election.
10 January 2012 12:49AM
Good policy Ed - Why bash the "hardworking majority" when you can bash the sick, disabled and the unemployed.
10 January 2012 12:50AM
Hey, be thankful for small mercies - at least he didnt manage to cram in:
'these strikes are wrong at a time when negotiations are still going on'
10 January 2012 12:51AM
Doesn't he look tired
10 January 2012 12:52AM
now you are just having a laugh! tell the truth! what f***ing politician ever does that!
10 January 2012 12:52AM
"Next time we come back to power, it will be different. We will be handed a deficit. Whoever is the next prime minister will not have money to spend. We will have to make difficult choices that all of us wish we did not have to make."
It's like he's literally saying the same things the Conservative party said when they got into power.
10 January 2012 12:53AM
With current UK debts and obligations at around 950% of GDP, for anyone to suggest that we should continue to borrow and spend is a treasonable idea.
10 January 2012 12:54AM
i might just take a look brother...
10 January 2012 12:54AM
What Britain needs is a bloody alternative. How about some action instead of all these, supposedly inevitable, "hard choices"? If anyone has been pulled, quite pathetically, into another persons' "battleground", it's Ed being suckered and dragged and dirtied into the Tory's own ultra-conservative paradigm - where the working people of Britain have to suffer and pay for the destructive excesses of a structurally faulty system, of which all of these muppets dogmatically, and unflinchingly, support in the first instance.
"Hard choices" are the exact same words Blair used to justify his own position in upholding this economic prison in which we all seem absolutely bogged down in today. A sad landscape indeed. We're in desperate need of some new ideas.