The public sector is back in public demand

For decades British governments of both left and right have venerated business. Government should be more like business, they’ve argued. Civil servants can’t get promoted unless they spend time out in the private sector while senior jobs have been thrown open to first timers from business. No quango is ever complete without businesspeople, preferably with one of them at its head. 

Forty years ago Margaret Thatcher agreed with Ronald Reagan that private was better, as the President put it “government isn’t the solution, government is the problem”.

The fervour has persisted until now even though the leading businessmen who have made the transition straight into politics by being elected or, more likely appointed to the Lords, have not proved to be Masters of the Westminster Universe. 

Lord (David) Young was a lynchpin of Thatcherism. But Archie Kirkwood MP never quite made it to the top ranks under John Major. The Blair government got into all sorts of tangles with Lord Levy and Geoffrey Robinson. Under Cameron, May and Johnson representatives of “business” in the government have mainly come from the world of finance, which is not exactly the same thing. Recently, Titans of industry have been more likely to be co-opted as advisors – like Sir Philip Green. Still, we now know the likes of Sir James Dyson or Richard Desmond were only ever a text message or fund-raising gala seat away from cabinet ministers. 

Rightly or wrongly, and whether business or finance, links to the private sector are no longer seen in a positive light. Matt Hancock’s lifelong family involvement in small and medium sized businesses, for example, has put him in the top three of the opposition’s hitlist.

In contrast, the public sector is back in the public’s affections. This strengthening current is a common thread running through all the political challenges facing Boris Johnson, including Covid, of course, but also other big issues such as fighting climate change and lobbying as well as individual wildfires such as the Football Super League and the Hartlepool by-election. 

The Prime Minister has been quicker to spot that this latest iteration of public/private division need not translate neatly into the traditional left/right political contest. Nor is it one in which the right is preoccupied with preserving liberty and leaves equality to the left. 

The pandemic has sped this swing of the pendulum away from the private sector. Everyone has reason to be grateful to “our NHS” and to big government for the record breaking levels of economic support dispensed. 

The tone of the transatlantic discourse has shifted with the replacement of America’s loudest businessman-president by the ultimate public servant. In truth, Trump splashed the cash too, but Joe Biden’s $1.9 trillion bailout is the marquee event in the US, attracting much less opposition than President Obama’s much less expensive bailout in 2009. Things are different now. Senator Joe Manchin of West Virginia, the swing vote on the rightwing of the Democratic caucus explained: “we need the government, it has to help us out”.

It is impossible to know what contribution the Prime Minister’s “every means available” threat made to the collapse of the proposed breakaway by some of Europe’s richest football clubs. Yet, he can now take credit for riding the wave of public opinion against billionaire club owners. Boris has also expunged his “greed gave us the vaccine” gaffe which bombed with Tory backbenchers. Unfettered capitalism be damned. It turns out that greed is not good, if it means flattening the struggling football teams beloved in dozens of Red Wall seats. 

The Conservatives’ Levelling-Up agenda amounts to transactional generosity with tax-payers’ money. It is not levelling up in the sense of trying to make things fairer across the board. Local government budgets are still being savaged. Instead, central government is coming up with cash for competitions and targeted grants which end up going to those areas which have gone blue or are trending that way. 

The Tory candidate in Hartlepool’s main pitch is bare faced. Elect Jill Mortimer, she promises, and that will bring in the likes of the government investment already tipping into nearby Durham. Shell-shocked Labour canvassers report loyal supporters telling them they’ll vote Tory on 6 May to see what they can get for the area. They promise to return to the Labour fold at the next general election. Boris Johnson is calculating that a habit once broken will not be so easily mended.

His cynicism is less of a novelty than the stated intention, which represents a transformation in applied Conservative orthodoxy from Margaret Thatcher onward. Civic spending is back, albeit from the centre and not via the council or devolved administrations. That will mean taxes going up, especially on business and wealth. The modern-day equivalent of the “Gentleman from Whitehall” is offering to take your money to sort out your problems. 

But which “gentleman”? This government certainly isn’t going to allow the permanent civil service to take the credit, if it can possibly avoid it. This explains the bind it now finds itself in over lobbying. If ministers, or top civil servants, bypass the bureaucracy they cannot fall back on the blame game of “due process” when their outside contacts go toxic. Or doubly toxic in the case of David Cameron. It is farcical that Lex Greensill was invited into Whitehall to position himself to profit from earlier payment of government obligations at the same time as its outsider “efficiency” advisor, Sir Philip Green, was urging it only to settle up at the last possible moment.

At every stage of Greensill’s involvement with the government some civil servants were urging caution. Cameron’s reputation is shot because of his poor judgement. Greensill failed and is likely to bring down Gupta’s Liberty Steel, threatening thousands of jobs, amid allegations of possible fraud. 

This week, officials as senior as Tom Scholar, the Treasury permanent secretary, mounted a generalised defence of high level contacts as business as usual. This may well be true, especially since instant access mobile phones made such direct lobbying easier than ever. Yet political weather cocks are turning, what has been normal is starting to look unacceptable. 

Ministers are expected to tighten the regulations governing their links and those of their civil servants to business. This may be done reluctantly and patchily but it still likely to have consequences. Ministers and civil servants will be drawn closer together in their own self-interests. Barriers will spring up barring the direct access of business to government.

Transparency, stricter monitoring and a longer “arms-length relationship” with business will be bad news for those seeking to go through the revolving door to feather their nests after public service, though they will do nothing to blunt the earning potential of an entertainer like Johnson. Not now, but over time, the rewards gap at senior levels between the public and private sector could start to level up to something closer to its post Second World War differential. Perhaps. 

Any tighter restrictions on politicians and pen pushers dealing with business will be popular with a bruised and resentful electorate. Johnson has grasped this more quickly than his opponents. Sir Keir Starmer has rushed to stick the “sleaze, sleaze, sleaze” label on the government. Tony Blair sees the risk that the charge could spread to the whole political class and pointing to the Christian principle of let he who without sin cast the first stone. 

As a former journalist and as a politician Johnson knows an angry mob when he sees one. He has always been in favour of big spending, if unclear where the funding was coming from. The crisis gives his vagueness cover. He will continue to champion innovation but he will not want to be seen as the friend of business in this next phase of his premiership. His “F*** business” outburst when practical concerns stood in the way of his Brexit ambitions revealed that the private sector has never been closest to his heart.

Cash doled out to favourite causes from the centre has often been the mark of the paternalist, if not the authoritarian. Anti-lockdown Tory MPs fear “Boris” has lost his old libertarianism. We shall see. Already this Conservative Prime Minister is identifying with the public interest, or his interpretation of it, not the private sector.