Old Labour is alive, well, and busy giving New Labour a kicking

Regional officials drew up ham-fisted psychological portraits as to who should speak at conference

RUMOURS OF the death of the Labour Party conference have turned out to be premature. This week's elections and debates have shown it to be very much alive and kicking. The election of the centre-left Grassroots Alliance candidates to four out of six constituency places on the national executive, and the robust performance of trade union leaders such as John Edmonds and Rodney Bickerstaffe in the discussion of economic policy, showed that the party conference remains a real forum of debate.

Earlier in the year, with the cash for access scandal, we had a foretaste of what would fill the vacuum if ordinary party members and trade unionists were denied their say in the Labour party's policy-making process. Without the counter-weight of the Labour Party's democracy, the wholly unaccountable forces of big business would have almost total sway over the channels of access to ministers. Indications of what would replace democratic elections and conference votes, if the control freaks had their way, are all over Blackpool this week. Delegates' badges advertise Somerfield, and the Conference Guide is full of glossy ads for the pro-hunting Countryside Alliance, British Nuclear Fuels and Nestle, while other companies lay on lavish refreshments to lure delegates to fringe events that are devoted to boosting their firm's profit line.

The big vote for the Grassroots Alliance slate in the NEC elections was by no means simply a vote for the left. On its own, as the 31 per cent vote for Socialist Campaign Group candidates in 1994, 1995 and 1996 showed, the left represents little more than a third of the party membership. Last year, faced with Peter Mandelson's first bid for elected office within the party, the left was joined by many from the centre and old Labour right, so that candidates opposed by the establishment received 39 per cent of the vote.

In the subsequent year, this process developed further to produce a real coalition of the left, the radical democrats and Hattersleyites of Labour Reform and soft-left readers of Tribune, in the Grassroots Alliance. People such as Andy Howell, chair of Labour Reform, argued that socialist values could be realised only via radical democratisation, while the left stressed that the free market alone would never deliver social justice. The result was convergence in an alliance whose views tallied with the concerns of most party members.

This is no cause for triumphalism. The election was not a victory for Labour Briefing or any other grouping. It was a victory for the decent party members who want to keep our party Labour. The efforts of Neil Kinnock and David Aaronovitch to smear the candidates as far-left Trotskyists and distort the slate's political views simply did not wash with the ordinary members who know better. In fact, the Grassroots Alliance offended the sectarians on the left as much as it did some of the party establishment. People such as the far-left Socialist Organiser urged people not to vote for the Grassroots Alliance slate because it did not meet their misguided standards of ideological purity.

That is why people who have traditionally been as far apart on the political spectrum as myself and Roy Hattersley were delighted by the results and hope very much that the alliance will go from strength to strength as a model of political pluralism.

The big issue now is how the leadership will respond to what has happened. Two approaches are emerging. The Millbank fundamentalists say the vote of the party membership is irrelevant. They relish the idea of an eternal holy war against any deviation from the true faith. Like so many religious fanatics, they seem driven by an inability to construct proper human relationships, to find another outlet for their energies. This group has already significantly discredited itself. London delegates were incensed to learn that regional officials were sitting around drawing up ham-fisted psychological portraits to determine who should and shouldn't speak at conference. Millbank tried to kill the story by claiming they had sacked someone, but we have yet to learn whether disciplinary action was directed against those who wrote the reports or the person who leaked it!

David Aaronovitch's piece in yesterday's Independent typifies this tendency to permanent conflict. Having wasted most of his early years in pointless factional wars inside the Communist Party, he suggests the Labour Party should adopt a similar approach to dissent. Whatever he may think, most voters will have recognised that issues such as interest rates, retaining public ownership of the Post Office and the impact of the pound's exchange rate on manufacturing industry are worth discussing in an open way.

Those whose factories are threatened by closure or who dread the monthly mortgage bill will have been delighted to see that attempts to turn the conference into a simple rubber stamp for policies made elsewhere seem to have failed. Of course, it would have been better if, at the end of the discussion, there had been a vote, because it undoubtedly would have resulted in support for lower interest rates and an exchange rate at which the British economy is able to compete. That may not yet be the view of Gordon Brown or the Bank of England Governor, Eddie George, but the TUC, the CBI and most of the Labour Party conference delegates think differently.

It is simply not true that the Treasury's orthodoxy is the only possible economic policy. Ten years ago, in Livingstone's Labour, I said that Labour should become the party of low inflation and sound money. I argued against endless devaluations as a way forward because they are manifestations of the problems in the UK economy, not a cure for them. But that does not mean we should try to hang on to an over-valued pound when it is destroying our manufacturing industry. It means that interest rates and the exchange rate should be set at levels that encourage investment. Progressive taxation is necessary not as revenge against the rich, but to ensure that lower interest rates don't stoke up inflation, and to divert resources from the present record levels of company dividend payments into productive investment. That is vital, because underlying every other problem and the cause of this country's century long economic decline is that we invest a far lower share of our economy than do our competitors in Europe or Asia.

You can agree or disagree with these views, but probably most of the Labour movement now agrees that they are a practical alternative to the risk of a deeply damaging recession.

A second section of the leadership has taken a different approach to what has happened this week. They recognise that, as the only section of the NEC elected by secret ballot of the entire membership, the constituency section election is the best possible barometer of what party members think. Tom Sawyer warned in a newspaper interview this week: "There is a perception of a class of people around the top of the Labour Party who are not elected, who do not account to anybody and who have enormous influence over the Government. That is a perception. I am not saying it is true. The message has got to be that the most important people at Blackpool are the Labour party delegates."

On this matter, at least, Tom is right.