Will Keir Starmer’s 'Plan for Change' be ambitious enough?

I wrote last week about Keir Starmer’s Plan for Change, the government’s targets for this parliament that will be published on Thursday.

I argued that it represented a return to Tony Blair-style cross-departmental target setting, which were the hallmark of Blair’s second term in office, under the influence of the head of his “delivery unit”, Michael Barber.

In Starmer’s case, the delivery mechanisms will be his “mission boards”, which are like cabinet subcommittees in bringing together assorted cabinet ministers - but are “more freewheeling”, according to a member of the government.

My impression is that, so far, these boards have lacked any urgency to tackle the nation-crippling challenges facing underfunded public services and a sluggish economy.

So the point of the Plan for Change is to give them oomph, by setting clear ambitions for cutting crime, CO2 emissions and immigration, and boosting education attainment, living standards and health outcomes.

So what does history teach us about this kind of goal-setting approach?

Well the second Blair term delivered important improvements in core public services, especially schools and hospitals. But it had one massive advantage that Starmer lacks.

The economy 23 years ago was growing so rapidly, and the public finances were so strong, that the then prime minister had cash coming out of his ears. Blair had tax revenues to splurge, and splurge, and splurge.

For Starmer, money is almost too tight to mention, even after Reeves’ budget that increased taxes by £40bn and borrowing by £30bn - such is the crippled state of the public sector and infrastructure, and such is the endemic economic malaise.

So success for Starmer relies almost exclusively on reform of public services to improve their efficiency, and on reconstruction of the economy to restore growth in productivity, or output per hour worked.

Getting ministers out of their silos and into a mindset of teamworking will help. For example, reducing immigration is about the pull and the push: it is about unmet demand for skills from UK businesses as much as home office visa rules.

Just as important as policies made by the Home Secretary will be those made elsewhere, such as recalibrating skills education, reforming welfare to enhance work incentives and increasing health service capacity to accelerate the return to work of the incapacitated.

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But the project that matters most may still be missing.

As I have said for months, there is a humongous gap in this government’s economic policy, which is the absence of a bold programme to harness the most important industrial revolution of our lifetimes - the artificial intelligence revolution.

This has the potential to at least double GDP and productivity growth. But the UK doesn’t have a single world-class supercomputer, whereas Elon Musk alone has three.

In fact, over the summer Starmer actually cancelled the development of an exascale supercomputer at Edinburgh university that Sunak had approved.

As for AI skills training, both in schools and for adults the UK lags behind Singapore, South Korea, the UEA, much of Scandinavia, Canada and other competitor countries.

There is a very stark choice for the UK, in a world where the US and China are deploying hundreds of billions of dollars to AI hardware, the requisite power networks, software, research and skills.

The UK can seize the moment and try to convert its world-class research brains - that only recently scooped a brace of AI-related Nobel prizes - into British owned commercial enterprises, in AI, but also in life sciences and finance, inter Alia.

Or the UK can in effect become an ever weakening client nation of the great superpowers of West and East.

Of course, AI brings massive social and cultural risks as well as massive potential economic benefits. But the good and the bad are coming whether the UK becomes a creator and owner or remains an unambitious customer.

Even in Starmer’s day job he must be able to see and feel the personal costs of how far behind the UK has fallen behind in ownership of the industries of our age.

One example is all the chatter that Elon Musk alone could endow Reform with enough cash to turn it into the best resourced UK party and Musk wouldn’t feel even a tiny dent in his $350bn fortune.

So this is quite a moment, for Starmer’s government and the UK. Harnessing AI - and I mean taming it as much as riding it - is the only available route to significant restoration of prosperity, and is therefore for him the sine qua non of winning the next election.

Given the speed of AI development, and the risk of falling irretrievably behind, if Starmer isn’t panicking, he really should be.

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