Public Ownership ‘Ain’t Gonna Be Easy!’ – Learning from Labour’s 1973 Programme

The late, great, Tony Benn (Source: The Independent/Bryn Colton/Getty Images)

This article is the first in a new series on workers’ control, exploring both historical and contemporary examples and theories and their implications for Labour’s National Education Service policy. For background on this policy and my proposals for public ownership in higher education, see this previous post.

At Conference last year, John McDonnell declared in no uncertain terms the return of democratic socialism to Labour Party economic policy. “We believe that workers, who create the wealth of a company, should share in its ownership and, yes, in the returns that it makes,” he said, announcing among other things, the creation of ‘inclusive ownership funds’ in which workers will be given shares, and therefore a say, in the direction of the companies that employ them.

Not since the 1970s has workers’ control been on the cards for Labour, and this commitment to change ‘from below’ is, as Hilary Wainwright has repeatedly pointed out, what truly distinguishes Corbynism from all its predecessors since that time. While some Corbyn supporters might be keen to distance the current Labour leadership from the 1970s – despite the obvious links with influential figures from the period like Tony Benn through the Independent Left Corresponding Society, for example – I would argue that it is more important than ever to learn from the past so that the same mistakes aren’t made again if and when Labour come to power. As McDonnell pointed out in his speech, ‘the best protection is memory’.

One of the most fascinating accounts of the development and ultimate failure of what became known as Labour’s Alternative Economic Strategy (AES) during the 1970s, now sadly forgotten and out of print, is a slim volume written by the Coventry, Liverpool, Newcastle and North Tyneside Trades Councils in 1980, published by the Russell Press, called State Intervention in Industry. Following Harold Wilson’s betrayal of Labour’s 1974 economic strategy, which as will be explained below, threatened a fundamental transfer of power from corporations to workers, the four trades councils undertook what they called a ‘worker’s inquiry’ into what went wrong.

‘Many of our weaknesses in the rank and file of the trade union movement come from a failure to look thoroughly into why Labour governments have not lived up the expectations working people have of them,’ the Preface to the book explains. ‘For this has happened not just once, but again and again; every time in fact.’ However, with humanity facing ‘nothing less than the irreversible destruction of the environment within our lifetimes’, we cannot afford for such an opportunity for deep and lasting change to be wasted again. Finding out why exactly Labour failed to implement its radical policies in the 1970s, therefore, is crucial to preparing for power in the future.

Alternative Economic Strategy

The ‘1973 Programme for Britain’ was arguably the most radical version of Labour’s AES. As the inquiry explains, the policy emerged out of an understanding that the economy had changed, and that the Keynesian approaches that had dominated economic policy since the war were no longer working. Discussions in Labour Party subcommittees and within the left of the party had identified a ‘new enemy’, the multi-national corporation, which could ‘give two fingers to government plans with one hand, while taking the incentives on the other.’ In this context, the Labour left concluded that only policy aimed at taking on this new ‘mesoeconomic’ power would be able to exert any control over the economy in the interests of the working class.

The 1973 Programme, which became the basis for Labour’s economic policy going into the 1974 General Election, proposed the creation of a National Investment Board with the power to acquire a majority stake in the top 25 largest UK manufacturing firms and impose planning agreements on a further 100 companies within the private sector. In both cases, shop floor-based structures of industrial democracy would be established, organised through trade union channels, and workers would have access to commercially sensitive information in order to be effectively involved in democratic corporate planning.

However, after being re-elected on this radical platform, Harold Wilson gradually moved away from these policies, eventually removing Tony Benn from his position as Secretary of State for Industry. In office, Benn had as his first action prepared a Green Paper based on the 1973 Programme, which was ‘never to see the light of day’ thanks to an intransigent civil service, which took exception to being sidestepped by a Minister hell bent on implementing his radical policies. As Benn told the inquiry after the fact, once Wilson took over as chairman of the cabinet sub-committee for industrial matters, the original policies were ‘as good as dead’.

So, what happened? Essentially, the Labour left failed to anticipate the power of entrenched interests that would, of course, oppose such a fundamental redistribution of ownership and control. ‘Preparation for the 1974 Labour government consisted almost entirely of discussion of policies at the exclusion of the strategy and the means of carrying these policies through,’ the inquiry concluded. ‘Paradoxically, the Labour left identified the power of the corporations, but did not prepare to meet that power.’ While the private sector was quick to organise extra-parliamentary pressure through the Confederation of British Industry, Labour’s left-wing failed to mobilise the grassroots to exert pressure on industry and the Party leadership ‘from below’.

One of the key issues identified by the inquiry was the distance between trade union leaders working directly with the Labour Party and rank and file members. Not only were shop stewards’ committees not involved in the formulation of the AES, but trade union leaders were not accountable to these rank and file organisations. This meant that activists on the ground assumed that the policies were being implemented until it was arguably too late to make a difference. Despite being relatively strong and confident – following the successful ‘work-in’ at the Upper Clyde Shipbuilders in 1971 and the Miners’ Strike in 1974, which forced the general election lost by the Conservatives under Edward Heath – the labour movement could not apply pressure from below on the Party to ensure the implementation of AES policies.

Lessons for today

Unfortunately, the labour movement today is far weaker than it was in the 1970s, so Corbyn and McDonnell will likely not have a strong, confident and highly organised working class to back up its public ownership policies. While the Labour left are now in charge, unlike Tony Benn in 1974 who was marginalised within the party, Corbyn and McDonnell have been constantly undermined by undisciplined centrists and right-wing reactionaries and will not doubt face the same intransigence from the civil service. The inquiry recommends in future the ‘mandatory reselection’ of Labour MPs to bring discipline to the party, as well as the political appointment of top civil servants and a strengthening of the powers of parliamentary committees to bring the civil service in line. Corbyn and McDonell would be wise to heed the wisdom of these suggestions, as they are borne out of bitter experience.

But how will Labour build the grassroots power needed to force the now even more powerful multi-national corporations to cede control to workers and the state? The inquiry suggests the widespread formation of multi-union, shop stewards ‘combines’, based on the model of the Lucas Aerospace Combine Committee, which would address the complex division of labour of modern corporations and provide the organisational structure for the creation of alternative corporate plans, like the Lucas Plan. The inquiry also insists that Trades Councils provide a good base for linking combines with local communities, to expand firm-level practices of worker control into local and regional practices of popular planning.

However, it is not clear that the energy and time required to regenerate trades councils would be well spent, at least in the short term, and combines – while certainly powerful organising structures capable of matching monopoly power – are not today a feature of popular working-class consciousness as they were in the 1960s and 70s. As Hilary Wainwright insists in her submission to Labour’s latest round of National Policy Forum commissions, what we need first and foremost before we can even think about implementing policies for workers’ control is a ‘profound cultural shift in the attitudes and strategies of public [and private] sector management and in the consciousness and also in the self-confidence of working and would-be working people’.

‘Within wider society we are faced by the need to overcome decades of subordination and a culture of acceptance of subordination as simply, “the way the world is”,’ Wainwright explains. ‘Moreover, decades of neo-liberalism’s competitive individualist culture have instilled the belief that it is only through competing with others that it is possible, individually, to advance.’ To rebuild industrial strength and confidence, Wainwright suggests that workers should be given facilities time by employers to participate in corporate strategy planning as part of what she calls ‘New Democratic Management’, and the working week shortened so that everyone can also participate in popular planning within their local and regional communities. Managers should also receive training on how to co-operative with workers and run companies democratically.

Perhaps most importantly, and a proposal that chimes with my own submission to the last Labour’s National Policy Forum, Wainwright emphasises the importance of ‘popular economic education’ in rebuilding the political and economic literacy of workers so they are not only able to take power but understand the need to take on this responsibility as part of a sustainable future society. ‘This would require a rebuilding of the infrastructure of adult education,’ Wainwright points out, ‘with economic democracy at its heart.’ This is exactly the thinking behind my proposals for ‘socially useful’ colleges and universities acting as democratic anchor institutions for a just, green economy. While the economy must take precedence in securing an equitable future society, it is education that will ensure this future is a radically democratic one, run on and sustained by people power.


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