The Power Test Podot

In a week of drama in Scottish politics, Ayesha Hazarika and Sam Freedman are joined for this week’s episode of The Power Test by former Labour leader in Scotland, Kezia Dugdale.
They discuss where Scottish politics goes next following the shock resignation of Humza Yousef, whether the SNP's attack lines on independence have been blunted, and whether Anas Sarwar, the current leader of Scottish Labour, can take advantage of an increasingly rosy electoral picture.
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This week, Ayesha Hazarika and Sam Freedman are joined by none other than Sam’s dad, Sir Lawrence Freedman, to discuss future foreign and defence policy under a Labour Government.
How will Labour confront the range of security threats that the UK faces across the world? Sir Lawrence Freedman, renowned academic, historian and author on foreign policy and international relations, reflects on the grave challenges a Starmer Government will face in a dangerous world. From the 'Special Relationship' and how a Trump re-election might ignite the necessity for nuclear independence, to analysing the sustained threats post by Putin and Russia, and Xi and China, this is a wide-ranging but essential discussion.
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Is Labour capable of reversing the curse facing centre-left governments around the world? Josh Simons, Director of the highly influential think tank Labour Together says the party must be ready to confront the challenge of thinking about how it can govern and win a second term.
Josh joins Ayesha Hazarika and Sam Freedman to speak about how Labour is preparing for government and whether the party really has a plan to win the decade in power it wants and needs.
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On this week's episode of The Power Test, we're looking at all things local elections - including bins! - New Statesman Britain Editor Anoosh Chakelian joins Sam and Ayesha on the pod and discussed how these will have an impact on Labour and whether it can deliver real change in government.
Episode notes:
The Tories are trying to make headway by putting the blame on Labour-run councils themselves, but while voters seem to be seeing through the attacks, the question remains as to whether Labour is really prepared for the true state of its likely inheritance.
“We know councils are under a huge amount of pressure at the moment and this is a source of real pain for people - who are seeing services cut, council tax bills rising and places like Birmingham going bankrupt, with others teetering on the brink” says Ayesha.
“Eight councils have gone bankrupt since 2010, and this should be a story of how the Conservatives have failed local government. But, Tory rhetoric is trying to blame Labour-run councils themselves” added Chakelian.
“A lot of major councils are run by a Labour administration, and so there is a reputational risk which Labour needs a retort to, but it doesn't because it doesn't really seem to have a plan of how it would save local councils from going bankrupt when they get into government.”
If Labour does well in the elections, the party will also face increased scrutiny over what its approach will be like more generally in government - presenting risks for the party.
Chakelian says the party “needs an answer” - and that “there’s all sorts of things that they can do without making big spending commitments, like council tax reform and changes to business rates.” “Sorting out adult social care is also key, but that would require some sending commitments.”
When asked her key tests for Labour, Anoosh said that having a plan on local government financing was key - but also whether the party could hold firm on their commitments over planning.
“I would like to see if their planning commitments will actually come off. Starmer has said he will ignore local opposition to developments. But can he really do that if they win as many MPs as the polls tell us they will. They’re going to have lots of MPs representing places with nice lovely green spaces and are they really going to want the first thing their government to do is sign off a load of building projects?”
Sam added, “Then you’ll have the National Trust kicking off their campaign, and the RSPB and all of them get involved. It’s pretty hard to fight that lobby. So yea, I’m with you - I hope they commit to that. But, it will be a big test for the first couple of years.”

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Following last week's episode with Ed Balls, former Treasury boss Nick Macpherson joins Sam and Ayesha to interrogate the economic environment facing the next government. We’re hearing a lot from Labour about economic security, fighting off the party’s reputation for ‘spendonomics’, but is the party being too far too cautious and harming its plans for growth?
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Nick Macpherson on this week’s pod suggests maybe it is. The former Treasury boss says the party shouldn’t get “obsessed with fiscal rules”
Don’t get obsessed with fiscal rules, ex-Treasury boss warns Labour
A future Labour Government should borrow to invest and avoid being “too obsessed with fiscal rules”, says the former Treasury boss, Sir Nick McPherson, on this week’s The Power Test podcast with Ayesha Hazarika and Sam Freedman.
In a wide-ranging discussion about a future government transition and Labour’s economic plans, Sir Nick said:
Borrowing:
“My guess is Labour will, and so they should, borrow a bit more in order to invest. Providing that investment program is focused on what really matters and is then seen through I don't see that as a great problem in terms of the public finances. Indeed, some would argue that that Labour may be being too cautious.”
Labour’s fiscal plans:
“The case for being tough now is potentially it gives them room for manoeuvre. It gets them credit with the financial markets which, actually, is even more important today than it was in 1997 simply because the national debt is a whole lot higher and the interest rate bill required to service that debt is very high indeed.
“The other thing is, and this may surprise some people, I'm a relative optimist about the economy so I think the Labour inheritance may just be a little bit better than the OBR and others are suggesting. Real wages are rising, interest rates may come down this year which will help people with mortgages and so on, and we just may see more spending in the economy, the economy growing a bit more fast and rather more revenues coming in than expected. If I'm right, and you know I'm not always right, they may actually have rather more room for manoeuvre and so they may be able to stick with the fiscal plan whilst also spending a bit more.
“My guess is also they will have some tax increases up their sleeve of the sort which is consistent with the wider commitments not to raise the main rate, say, of National insurance and income tax.”
The £28 billion and fiscal rules:
“Did they have to drop the £28 billion commitment? In the end, £28 billion is not actually very much these days. It's about 1% of GDP. I mean, compared to the sorts of money Nigel Lawson gave away in 1988 this is chicken feed. But I can see in an uncertain world why they just want to be a bit cautious."

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As Labour announces its plans to reclaim 'Levelling Up', Sam Freedman and Ayesha Hazarika are joined by Ed Balls to discuss the dual challenges of tackling economic and regional inequality and going for growth
Boris Johnson’s claim to end the North-South divide has been a spectacular disaster in terms of going from a box office slogan to something of any substance at all. Councils across the UK are on the brink of collapse and bankruptcy and economic equality across the country has never been more entrenched.
So what happens now? Can the agenda move into reality and what would an actual Levelling Up plan look like? Are people going to buy it anymore without any tangible progress to show for it, and ultimately what is the role of Westminster vs local authorities and regional mayors.
Tackling regional inequality is not only an end in itself but also a means in going for growth - an absolute imperative for the next government. Both Labour and the Tories have said they want to deliver growth, but what is the path for delivering it? It has to be a key priority for the next Prime Minister, as part of a central growth drive, working with and not against business, championing open markets and consumers as well as a comprehensive backing for combined authorities with devolved powers.
Ed also speaks to Sam and Ayesha about podcasting with George Osborne, Labour’s workers rights package as well as never being invited to give the Mais lecture. He is also the first guest to face our new Power Questions section - where he calls for Keir Starmer to grasp the theme of Global Britain and be confident about the UK’s outward facing role in the world, how Jo Cox’s legacy can help heal divisions in politics and ultimately, how the party should be willing to say when it thinks other parties have done good things that it will continue in government.

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