David Blunkett on the deep roots of New Labour – and the political dangers facing Rishi Sunak

John Rentoul listens to the former home secretary talk about how Labour prepared for government in 1997 and the terrible position he believes the country is in over immigration

Seat of power: the Labour cabinet meet for the first time after the 1997 election victory (PA)

David Blunkett, education secretary, home secretary and work and pensions secretary in Tony Blair’s government, started with “ancient history” in his talk to our students at King’s College London.

He said they needed to understand how the “third way” of New Labour emerged in response to the challenge from Margaret Thatcher. In other words, it wasn’t just Tony Blair. And it wasn’t just copying Thatcherism.

“The thing that irritates me most about the criticism of the New Labour period is the term neoliberal,” Lord Blunkett said. “We were never neoliberals in either intent or in delivery. It’s sloppy politics to use that term. Neoliberalism springs from [economist Friedrich] Hayek and from a particular view of the nature of the state. We believed that the state was a force for good.

“We should have done a lot more in decentralising and mobilising people in their own communities, but we were never in favour of a small hands-off state. Otherwise, we’d never have transformed health and education in the way we did.”

He was speaking last month to the “Blair Years” postgraduate class that I teach with Dr Michelle Clement and Professor Jon Davis. As most of the students were born after Blair became prime minister, he started with the prehistory: “What happened in the 1980s was that the Conservatives took the ideological high ground. This arose from people like Milton Friedman in the United States and the people around Ronald Reagan, who was president at the time; a swing to what they called the New Enlightenment.

“What we had was Old Labour, and Old Labour hadn’t moved on from the immediate after-war period. Of course, the Attlee government was really carrying forward the structures of the Second World War. So everything was geared to the top-down planning that was necessary in the war.

“The reason the 1980s is important is because there was a struggle on the left as to whether we continue to allow the right, that is Margaret Thatcher’s government, to paint us as being top-down, welfare-oriented, taking away people’s money, not allowing people to make decisions for themselves, believing that paternalism was the best way of improving the world.”

The Labour governments of 1945-51 and to some extent of 1964-70 had made the country a better place, in Blunkett’s view, but the party hadn’t changed enough. “People were still adhering to and clinging to what they knew from the past,” he said. “And Thatcher’s emergence shook the left. We had to decide whether we were going to challenge the New Enlightenment, and have a different formula for delivering social democracy, or whether we were going to stick to the top-down welfare-state paternalism of the past. And that struggle was going on right into the 1990s. Neil Kinnock as leader of the party from 1983 to 1990 had to deal with the internal traumas that were a consequence of that struggle for ideological supremacy within the party. So you had the Militant tendency pseudo-revolutionaries – pseudo because they really were pretty pathetic – and you had Old Labour; and we had those who were endeavouring to try and plough a new furrow, which eventually became known as the third way.”

The key event of this “ancient history” was the collapse of John Major’s exchange rate policy in 1992. “We were helped enormously by John Major winning the 1992 election,” Blunkett said. “We were lucky because in September 1992 Britain came out of the European exchange rate mechanism and Labour would have been blamed for it – it would have been donkey’s years again before we got into government – but it was a Conservative government that ran into that problem.

David Blunkett, left, with Dr Michelle Clement and John Rentoul (Supplied)

“It’s interesting to look now as to whether that event was so seminal that it really did mean the end of the Conservatives’ term in office, because that’s how people are arguing now with what happened in September, October and the 49 days of Liz Truss. Is it so seminal that it’s a ding dang certainty, as Boris put it, that Labour is going to win? I think not, actually, but the comparison is worth just thinking about a little bit.”

Blunkett was in a central position when Blair became Labour leader after the death of John Smith in 1994 because he happened to be chair of the party’s national executive – “it was Buggins’ turn”, Blunkett said, “it wasn’t because I was particularly prominent”. He was therefore responsible for organising the leadership election, and was close to the discussions between Blair and Gordon Brown about who would be the candidate of “the emerging New Labour left-of-centre”.

Blunkett said: “Tony was much more popular with the media because he was younger and more media savvy and in many ways more person savvy than Gordon. Gordon I think would describe himself as more of a thinker but was never good with people. I knew him very well; I’ve stayed in his house in Scotland a couple of times, but actually breaking down barriers with Gordon was very hard. So he wasn’t a ‘person person’. A very clever, very able politician, but not empathetic. And Tony was. The media liked him because he was saying the right things about breaking with the past.

“Part of Tony Blair’s offer, along with a group of others around him – Peter Mandelson thinks he’s the only one who was around him; The Third Man, he wrote – was to bring about radical change, but we needed to signal it to an electorate that were really inculcated with what had happened in the late 1970s; inculcated because the media went on and on about it. The Conservatives kept hammering the point that the last Labour government had been a disaster; that there’d been the winter of discontent in 1978-79; that the bins hadn’t been emptied.”

Lord Blunkett explained how New Labour shadow ministers prepared for government – especially himself as shadow education secretary and Brown as shadow chancellor. “For two-and-a-half years I was in opposition before I became a cabinet minister in 1997. Gordon was the other person who’d done a lot of work on what he wanted to do, with independence in the Bank of England. That helped enormously because when we came in, I was able to say to the permanent secretary, Michael Bichard, who remains a friend of mine, ‘This is the agenda and we need everyone to sign up, not to our party, but to the commitments that we’ve made and how we have outlined we’re going to deliver them’.

I think we’re in the worst possible position at the moment on immigration and asylum

David Blunkett

“We were able to bring in fresh blood immediately – vehemently opposed by some of the small ‘c’ conservative elements of the civil service, who were really against bringing people in from outside. The first person we brought in was Michael Barber, who later went to work for Tony in Downing Street and who regrettably – because he’s still a friend of mine as well – is now working for Jeremy Hunt, the chancellor, on training issues.

“Michael set up the standards and effectiveness unit [at the Department for Education]. We brought in practising head teachers, practising teachers and practising people from local government who had a strong part to play in education at the time. Believe it or not, there was virtually nobody in the education department who’d had any recent experience of education.” Without this preparation, and drafting in of outsiders, “we couldn’t have delivered the programmes that we did”, on literacy and numeracy in primary schools; “transforming early years, setting up Sure Start”; a “big boost” to further education; and another “transformation”, more controversial this time, of higher education.

Speaking to a class of students, most of whom had paid £9,000-a-year fees, Blunkett said “hands up” – and raised both hands high: “I introduced the first fees.” He explained: “They weren’t like the present ones, but we did raise a billion pounds in two years to invest in higher education. We had no choice, because whilst there was money from the windfall levy for massive investment in school building, and in the employment agenda, there was for the first two years only limited revenue for the schools agenda.”

At this point he entered an important historical footnote: “There wasn’t none. People keep saying that we stuck to the Tories’ spending commitments for the first two years – actually we didn’t. That is a myth. Gordon found money for the day-to-day revenue in schools and massive capital investment in buildings.” But it was obvious, he said, that new money for universities would have to come from new sources.

Blunkett claimed that the New Labour government got momentum going very quickly. “How did we do that? By ensuring that we had very good special advisers. I had four. Gordon had as many as he liked. Gordon set up a Council of Economic Advisers, which was just another way of getting in about 10 people who weren’t civil servants. I had four, and other people had two. I believe very strongly that the special advisers were crucial because I couldn’t possibly be on top of everything. So long as they understood that they spoke for me and not for themselves, and they understood what my agenda and the ministerial team’s agenda was, then we were fine. They were crucial as the link, the belt, between the ministers and the civil service on a daily basis.”

One of the students asked if in retrospect he thought he had been radical enough in Labour’s first term (Blunkett switched to the Home Office in the second term). “You can never have a Day Zero, where you do everything you need to do and then sit back and watch it work,” Blunkett said. “At the time, people thought we were moving too fast; that we were too radical. This brings up again decentralisation versus national diktat because we were caught in a dilemma. We believed that change could only really come about in the long term and be embedded if people delivering it believed in it; believed in what needed to be done and took it on board and made it immovable.

“We believed that there was a whole generation that was losing really significantly because of the gross failure of much of the schooling system. It is hard, all these years on, 26 years on from 1997, to conceive just how badly some schools were delivering to their students, mostly in deprived areas. A kind of benign ‘looking after children’ had come in, with a lack of aspiration and expectation, ‘Well, what can you expect, because the families are so deprived, it’s not going to be possible to transform their life chances’. Which was a bunch of garbage, and so we had to do something rapidly from the centre to kick-start that with the literacy and numeracy programmes. In those four years, we just about stretched what you could change to its absolute limit.

“So when I think back, there’s lots of things that we should have done or could have done, but the circumstances at the time would have meant the elastic broke and things would have really imploded. Again it’s part of the history: what was then the NUT, the National Union of Teachers, which is now the National Education Union, they had for a long time run Labour Party policy. Teachers were embedded in constituency Labour parties, which was fine with me so long as they didn’t believe that everything that was going on was hunky dory and didn’t want to change. That was really, really hard work. Because being booed at a teachers’ conference wasn’t something I came into cabinet to endure. Nobody ever goes to the teachers’ conferences now, but I used to go. I didn’t mind because Tony used to say to me, ‘Good stuff’. I said, ‘Good stuff? They were about to throw things at me’. He said, ‘Yeah, but the parents out there saw that you were on their side and things are going to change’. So politics is funny. You have to put up with a bit of a whatsit sometimes.”

He was asked about his regrets, and said: “I just wish I’d managed to get across much more clearly, and fought harder for, that decentralisation agenda, which everyone seems to want to engage with now – including Gordon’s recent report, if you lay aside his views on the House of Lords which are, er, interesting.” It did not sound as if he was totally convinced by the idea of a directly elected second chamber, an Assembly of the Nations and Regions, proposed by the Commission on the UK’s Future, chaired by Brown.

He described his time at the Home Office as “very difficult”; the department was “pretty good in a crisis” but “absolutely terrible at reforming incompetence”, infected with “out-of-date thinking” and “a belief that they really couldn’t change the world for the better so why bother”. This applied to crime, where New Labour made “an enormous difference”, said Blunkett, but also to immigration, “where I’ve never come across a more incompetent setup in my life”.

He said that the Labour government succeeded in controlling irregular migration, which at the time was “underneath as well as on the Eurostar, in the back of vans, people hanging underneath trucks, all kinds of horrors”, by reaching an agreement with president Nicolas Sarkozy, who had been the French interior minister. “We closed all that down by getting intelligence, security, immigration and customs on to French soil for the first time since Joan of Arc.* And it worked.”

But now the trouble had recurred in the form of small boats crossing the Channel, and Blunkett was critical of the government’s policy, which is “a mess”. He said: “The idea of sending people to Rwanda is risible. Firstly, if you landed on British soil, and you were immediately threatened with being transferred to Rwanda, what would you do? You’d disappear into the ether. So you wouldn’t claim asylum, you would just disappear. Or if you claimed it and you were put in a camp, you’d escape, wouldn’t you?”

And he warned Rishi Sunak of the dangers of promising what he cannot deliver: “If you promise people that you’re going to achieve a particular goal, and you know you’re not going to achieve it, you create enormous mistrust. And people then don’t believe a word of what you’re going to say, but you also raise expectations that you can’t fulfil. So I think we’re in the worst possible position at the moment on immigration and asylum.”

If the current government won’t listen to him – and he has opposed the Rwanda policy in the House of Lords – the next government should. Keir Starmer and his shadow cabinet should listen to one of the ministers who delivered most effectively on Labour’s early promises the last time it was in government.

*Mary Tudor, 1558, actually.