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In-person event

Rt Hon Oliver Letwin MP - A keynote speech on the role of the state

The Institute for Government is delighted to welcome the Rt Hon Oliver Letwin MP to give a keynote speech on the role of the state.

During this parliament, many have discussed how the role of government is changing.. As Minister for Government Policy at the Cabinet Office, Mr. Letwin has for a long time been one of the most original and influential Conservative thinkers about the state, and was one of the key architects behind the Open Public Services. Tonight, he was able to reflect on the last four years of policy development and look ahead to the role of the state and the challenges ahead. 

Institute for Government Director Peter Riddell introduced Mr. Letwin by welcoming him back to the IfG. With reference to many considerable policy changes over recent years, Mr. Riddell posed the question of what those changes mean for the role of the state today and what the role may become into the future, especially in an era of public spending austerity.

Mr. Letwin began by offering observations from his experience over the last four years. Against the background of an urgent fiscal crisis, the Coalition was formed with a very specific idea of how to lift the UK out of the crisis. Mr. Letwin praised the Coalition for sticking with that plan, despite criticism, and said we were now beginning to see success.

He identified three critical roles of the state over the past four years.

  • Stabilise and improve the economy: At a time of peace, the overriding role of government is to improve the economy and this becomes even truer when the economy is failing.
  • Get more for less in public services: The Coalition has sought to improve the long-term viability of public services. If you have much less money than you used to, you must figure out how to get the same level of services for less, and ideally even improve them.
  • Achieve government intervention without regulation (be consciously de-regulatory and interventionist): He reflected on the way the political debate about the role of the state had moved from the dichotomy of views over Marxism and capitalism to a debate dominated by choices between laissez faire and regulation. This debate was false suggested Mr Letwin. In the last four years, the Coalition had, he said, explored ways of being consciously de-regulatory and interventionist. Using behavioural economics, the government has been trying a whole series of ways of to get better results with the government’s active involvement but not by regulating or intervening directly.

At the request of Mr. Riddell, Mr. Letwin provided additional illustrations of conscious deregulatory intervention in action. For example, neighbourhood planning is well under way in around 1000 locations and is helping to people address housing shortages in their local areas. Communities are beginning to see themselves collectively as having the responsibility to do and provide things for themselves.

He acknowledged that this approach also requires the state to recognise areas—such as care for the elderly —where regulation is still needed but that regulation imposed should still be maximally effective and minimally intrusive. By way of example, he asserted that the problems experienced at Mid Staffordshire NHS Foundation Trust were not down to too little regulation but to regulation for the sake of bureaucratic measures rather than checking people were being looked after properly.

Therefore, the overarching implication for the central state is that it can afford to be what it needs to be: thinner, more agile, and more concerned with outcomes.

Questions from the audience included:

  • The Conservatives came to power with a radical agenda about role of the state – the Big Society – can you reflect on the validity of that argument now?
  • What can you say about the disconnection between the investment at the time of intervention and who benefits from the savings from it?
  • Where is the ‘payment by results’ method is going?
  • What do you think about merger between Pfizer and Astra-Zeneca?
  • Looking at vicious Coalition rows over knife crime and free schools, what’s gone wrong there?
  • Current programmes you have talked about are voluntary; do you think you would ever mandate, given extreme diseconomies of scale?
  • In attempts to change the role of the state, which areas have proved most intransigent to change?
  • If you want speed in transformation, shouldn’t you take local government and councillors with you?
  • You said that the more successful reforms become the less people notice; how would you get noticed more in the press?
Department
Cabinet Office
Publisher
Institute for Government

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