NB: THIS TRANSCRIPT WAS TYPED FROM A TRANSCRIPTION UNIT RECORDING AND NOT COPIED FROM AN ORIGINAL SCRIPT: BECAUSE OF THE POSSIBILITY OF MIS- HEARING AND THE DIFFICULTY, IN SOME CASES OF IDENTIFYING INDIVIDUAL SPEAKERS, THE BBC CANNOT VOUCH FOR ITS ACCURACY. ........................................................................ PANORAMA "The Labour Years" RECORDED FROM TRANSMISSION: BBC-1 DATE: 3:06:01 ........................................................................ JOHN WARE: Four years ago a new government promised us better schools, better hospitals, better public services. In four days the country will decide whether Tony Blair's party can still be trusted to deliver them. TONY BLAIR: We earned the trust of the people some four years ago and now we have to earn the trust again. WARE: Trust, honesty, straight dealing, delivering on promises. That's Tony Blair's message as he seeks the prize he treasures most - a second term for a Labour government. It was the same back in 1997. BLAIR: [Newsnight 3/4/97] I am not going to make any commitment that I cannot be absolutely sure of delivering. That is the honest way and it's the difference between ourselves and the Conservatives. WARE: Mr Blair is a lawyer by training. His commitments were enshrined in what he described as a Contract with the people - his manifesto. [1996 Conference] BLAIR: [Manifesto launch 1997] They are our bond of trust, most of all my bond of trust with the people of Britain. Judge me up on it. The Buck stops here. WARE: So tonight Panorama goes on the campaign trail to ask whether there was straight dealing as the Prime Minister promised, and whether public services really did improve. WARE: [Calling to Mr Blair as he leaves the launch] Mr Blair, the contract, did you keep it? And we examine the proposals of all the three main parties to improve our health service, our schools and our transport system after four Labour years. A new dawn had broken said Mr Blair as he was propelled into Downing Street with the biggest majority for 150 years. He inherited decades of under investment in public services. There would be a New Britain, he said. The country would be transformed. On the steps of Downing Street the youngest Prime Minister since 1812 signalled the talking was over. The action would begin. BLAIR: [Addressing the public 1997] We are charged with the deep responsibility of government. Today, enough of talking, it is time now to do. Thank you. (Crowd applause) WARE: Well, what did New Labour actually do? At the last election, after eighteen years of Conservative governments, levels of dissatisfaction over the NHS were the highest on record. With three days to go, New Labour painted a clear picture of a health service in terminal decline. Only they could save it.. Labour Party Election Broadcast 28th April 1997 (Father and child in taxi) Father: We've been in casualty all evening. Taxi Driver: Of course you have. You hurt your arm, didn't you Becky, hairline fracture. Must hurt though. Still, it'll get better - shame the health service won't. Father: You're telling me. Taxi: Think about the future son. Just imagine what your Becky's life will be like if the Tories get back in for another 5 years. What'll happen the next time she needs to go to the hospital? It doesn't bear thinking about, does it. WARE: If the images in the election were powerful, so too was the rhetoric. "There are just 14 days to save the NHS" said Mr Blair; then it was "24 hours to save it". But the small print of the contract - the manifesto - was somewhat less ambitious. Under the Conservatives, the waiting list had risen to 1.4 million. New Labour set a cautious target - 10% off that total. They pledged to take100,000 people off the waiting lists. How much political capital has been invested in getting this figure down, this figure of 100,000 off the waiting list? JOHN APPLEBY Chief Economist, Kings Fund It's been enormous. It's been enormous and I think it's certainly been felt the pressure of that political investment has been felt certainly in the health service. If you ask any manager, any clinician in the NHS their sort of top priorities, their top pressures, getting waiting lists down has been at the top of the list for a number of years now. Labour Conference 2000 BLAIR: The waiting list pledge has been met, 10 more nurses in the health service. 11 May 2001 ALAN MILBURN: We said in our manifesto that we would cut the waiting list by 100,000. We have exceeded that target…. WARE: The inpatient list - those waiting for a hospital appointment - has fallen by 150,000 meeting the pledge. But that's not the only side to this story. The inpatient list for England may have fallen. But the number of out patients - those waiting to get a hospital appointment - has risen by 36,500 since the last election. New Labour say their contract didn't apply to outpatients. In Wales the outpatient list has grown by 76,000 - even more than in England. On the day the government said they'd met their waiting list pledge, Mr Blair did a lap of honour around hospitals. In their '97 manifesto New Labour complained about waiting lists under the Tories having passed the million mark Today they're still well over that in England, a point I tried to put to the Prime Minister after New Labour had banned us from their press conferences. WARE: [at hospital] Good morning Mr Blair. Can you tell us when you might get waiting lists below a million because you're still standing at 1.3 million. Do you have any idea when that might happen? BLAIR: [no response] WARE: New Labour may have delivered their manifesto pledge on waiting lists, but patients may not notice the difference. JOHN APPLEBY The King's Fund The key difference that patients would want to notice is how long they're waiting, not necessarily how many people are waiting in front of them on the list, and on that basis I'm afraid they're not going to notice very much. WARE: How much ? APPLEBY: Well maybe when you average out the impact that reducing the waiting list has on waiting times, a more important factor for patients, you could possibly be talking about maybe a day, a few days, per patient. WARE: Latest government figures suggest that under New Labour, hospitals are finding it increasingly difficult to cope - as Panorama found earlier this year at St Peters' Hospital in Surrey. Panorama, 'Condition Red' 25th March 2001 SENIOR SISTER: It's a typical Monday afternoon. Everybody's on red.. red alert. We've just updated and we have got an occupancy of 212% so obviously double what we should be at the moment. WARE: The government figures show that over its four year term, the usual annual increase in the number of patients admitted to hospital has slowed down since the Tories were in power. JOHN APPLEBY Chief Economist, The King's Fund There's very strong indications, not just those figures but other figures as well, suggest that hospitals.. NHS hospitals are really working at the limits of their capacity. For instance I think… and his comes through in terms of other statistics, like the numbers of cancelled operations for no medical reasons, that's the technical term. We've seen that rise in some years, and those are indications that the hospitals are reaching the ceiling in terms of what activity they can do and do safely. WARE: You don't think the slowing down of the rate of increase suggests that hospitals are reaching the limit of their capacity? JOHN DENHAM Labour We're expanding the hospitals. We're expanding the hospitals, there are more doctors, there are more nurses, there have been more beds. WARE: Maybe not fast enough. DENHAM: Well we will continue that's the investment. That's what's so crucial about this week's election, is that people vote to make sure that that investment continues to go in. WARE: Yes, but you don't think that hospitals are reaching the limit of their capacity. You don't think the slowing down of the usual rise in patient treatment suggests that? DENHAM: The fact that another 140,000 patients, some of them planned admissions, some of them emergency admissions, were treated last year shows that we're continuing to expand the capacity of the NHS. WARE: For many members of the public, New Labour's dozens of highly publicised NHS initiatives have yet to make an impact - as Mr Blair discovered for himself on the campaign trail.. SHARON STORER: [17 May 2001] It's absolutely appalling and if you'd just like to go and have a look at it then you'll find out just how terrible it really is. BLAIR: I'm very sorry about the situation. STORER: No, you're not very sorry because if you was you would do something about it. They're understaffed, they've got terrible facilities. The toilets are appalling and Doctor Mahenga and her team of people, nurses and staff, are doing their best, and you're just not giving them the money to make the facilities better for them. BLAIR: Well we actually... I'm sorry but we are actually.... STORER: You're not. You are definitely not because you don't see. All you do is walk around and make yourself known, but you don't actually do anything to help anybody. BLAIR: If I can just explain to you what I am going to do.... WARE: The staff shortage about which Sharon Storer complained is chronic. It was already a crisis under the Tories. In their last year the number of nurses actually fell because they'd cut the number of training places. The number of trainee GPs also fell until 1996, a mistake the Conservatives, after four years of opposition, now seem to accept. You shouldn't have let the decline happen in the first place, surely? ANDREW LANSLEY Conservative Well we can debate what happened over the whole passage of the Conservative administration and I think I would agree with you that there are many things that we wished we might have done earlier and indeed increasing the rate of doctor recruitment, increasing the nurse recruitment we would have liked to have done earlier. WARE: So do you think you got that wrong, in all honesty? LANSLEY: Well I think you can say we got it wrong and we got it right. There was a period where we were failing to provide sufficient places by the latter stages of the Conservative administration we were increasing the number of places. We had increased the number of nurses, we were increasing the number of doctors' training places . WARE: Well slowly, very, very slowly and late - slow and late. So how did New Labour address the Tory shortages of equipment and staff to which their own election publicity drew such sharp attention? Labour Party Election Broadcast 28th April 1997 (Father and Child in Taxi) FATHER: Six hours we were in casualty. TAXI DRIVER: Shortage of equipment or shortage of staff? FATHER: Both - they said. TAXI DRIVER: So much seems to be in decline. JOHN WARE In their manifesto New Labour complained that Tory bureaucracy was swallowing an extra £1.5 billion every year. There were many thousands more managers and fifty thousand fewer nurses. The manifesto said the NHS was being "strangled by costly red tape". It promised to cut this and plough the savings into treating many more patients." Labour Conference 1997 The money will be there, I promise you that, this year, every year, millions saved from red tape. WARE: Today New Labour's website claims it's "on track to save £1 billion in red tape by next year. But - do their sums add up? The government claims that by abolishing the way GPs ran their practices under the Tories - it's saved £111 million in its first year. For the second year the saving was £53m, the third year £40m, this year £40m, and next year another £20 million. To you and me that adds up to £264m. How then does the government get all the way up to £1 billion? The answer is with an accounting slight of hand. They counted the figures once, then carried them over the next year, the year after, this year and next years - and counted them all again. By accumulating all these increases you get nearly one billion pounds. What do you think of the way the government has presented its bureaucracy savings? APPLEBY: I think it's straightforwardly misleading. WARE: Why? JOHN APPLEBY Chief Economist, The King's Fund Well what they've done is take individual savings each year and then roll them forward so perhaps legitimate savings of around 300 million has been reported by the NHS have magically turned into a rolled up figure of over 1 billion pounds. WARE: Have the public been misled? APPLEBY: Yes, I think they have. JOHN DENHAM Labour We promised to save a billion pounds over the lifetime of a full Parliament. That was absolutely clear. WARE: But how do you get to a billion, that's what I don't understand. You can only get to a billion by counting the figures over and over and over again. DENHAM: No, you save the money each year. It's an accumulative figure. This is not something new. I don't think you understand this. In 1997 we said that it would be a billion pounds over the lifetime of a Parliament. That was published in the first white paper we set out about the National Health Service, that it would be a billion pounds over the lifetime of a Parliament and it is. INT The King's Fund say the way you've presented these savings is straightforwardly misleading. DENHAM: Well I don't agree with that. WARE: Actually there don't seem to have been any overall savings in bureaucracy at all. In fact, quite the reverse. Department of Health figures show that under New Labour, far from cutting the extra managers they complained the Tories had recruited, the number of clerks, administrators and managers have increased by over 13000. This has added over £400 million every year in wages. So if the official figures show such a large increase in the number of bureaucrats, how does the government justify its claim to have made significant savings? Well part of the answer lies in this set of government documents entitled "Definition of Management Costs". New Labour seem to have redefined the definition. Under the heading "Summary of Exclusions" there's a long list of management salaries which are to be "excluded" from "Management Costs". Among them are staff hired to run some of the government's most prized initiatives which it says will modernise the NHS. "NHS beacons - excluded; NHS walk-in centres - excluded; NHS direct pilots - excluded". The management costs of all these initiatives don't count as bureaucracy. JOHN APPLEBY Chief Economist, The King's Fund We end up with a situation with the Department of Health defining management costs in such a way almost, I have to say, it's getting damned close to defining it in such a way as to produce a saving each year. It's a bit of a strange Kafkaesque world I guess. It's a bit like somehow redefining how you measure height of people when you have a pledge to somehow reduce the general height.. the average height of the population. WARE: Is that being straight with the public? APPLEBY: I don't think so. WARE: The King's Fund say the way you've presented these figures is Kafkaesque. JOHN DENHAM Labour It's not Kafkaesque. There were 3,600 managers working in the Tories internal market who were never shown in the Tory management statistics. WARE: And now you've got a lot more managers working on your initiatives. DENHAM: We presented them honestly and you would have expected there to be an increase in the number of senior managers of at least 3,600. There hasn't. It's been much smaller than that. It shows that the number of senior managers has been kept under control by the initiatives we've taken. WARE: So one man's bureaucracy is another man's modernising initiative, is that the way it is? DENHAM: No, we're saving on the cost of bureaucracy, we abolished the internal market. WARE: You're not, the figure's gone up! DENHAM: We abolished the internal market but I am not going to criticise key members of staff who are helping deliver services to patients. WARE: So, if there weren't overall savings in bureaucracy, how much was available to recruit extra nurses and doctors? Not much. At least, not at first. New Labour's initial priority was to lay the ghost of Old Labour's spending profligacy and economic incompetence and demonstrate its new credentials. So for two years, the manifesto pledged to stick to the tight spending limits set by the Tories. Well, New Labour certainly kept that promise. In its first two years, health spending grew at only half the rate of the Major years. So, while, the economy grew and houses prices soared, nurses and doctors fell further behind. APPLEBY: There were some small initiatives, nurse recruitment campaigns to get nurses to stay in the NHS, retention and so on. But really the numbers, the sheer scale of the numbers we were talking about required large amounts of money and investment. WARE: After keeping to Tory spending limits for two years, the government announced their third year would be the year of "delivery". And certainly the spending increase, over three years, sounded huge. 12th January 2000 TONY BLAIR: [speaking in Parliament] And as for real doctors, the extra doctors in training are real, the extra nurses in the health service are real, the extra £21 billion is real. Panorama, 'Spin Doctors' 13th March 2000 WARE: But, as Panorama reported, the real extra money was less than half the 21 billion. The government had used the same "triple counting device" as they had in claiming to have saved a billion pounds in red tape. The real increase was £10.3 billion. At the start of the election campaign, the London Evening Standard asked the Prime Minister about Panorama's charge of triple counting. Q: Do you wish you had been a bit straighter with us? A: No. We were absolutely straight. I mean the Panorama thing was just a complete disgrace because what they do is, they just take a whole lot of things out of context and throw them all together. WARE: Despite the Prime Minister's views, independent economists say the government's way of presenting figures is not reputable. JOHN APPLEBY Labour They used exactly the same sort of triple counting and rolling forward device as has been used to account for the apparent one billion pounds savings in management costs in the NHS. WARE: So what do you think of the way they presented the increases - 21 billion? APPLEBY: Well it was straightforwardly misleading and the government were criticised by House of Commons, Public Accounts Committee and many others on this point. JOHN DENHAM Labour You had a whole Panorama programme on this issue a year ago. WARE: Was it straight? DENHAM: 18... 18... 18 billion... WARE: Was it a straight way of presenting the figures? DENHAM: 18 billion is true. 3 billion, 6 billion, 9 billion is true. A faster rate of increase of NHS spending than the NHS has enjoyed for the whole of it's history also true. WARE: I'm talking about the way you presented it. I'm not talking about the size of the increase. I'm talking about the way you presented these figures. Was it a straight.. was it an honest way of presenting the figures? DENHAM: 18... WARE: The Prime Minister staked out some very high moral ground in the last election, didn't he. He said he'd forge a new bond of trust with the people. DENHAM: 18 billion is true, and you went over all of this in last year's Panorama. 18 billion was true. 3 billion, 6 billion, 9 billion. That's true. WARE: Triple counting. Triple counting. DENHAM: A faster rate of increase in NHS spending than over the rest of the history of the NHS even more true. DENHAM: Last year the government again announced a spending increase with the launch of the NHS Plan. BLAIR: Madam Speaker, with your permission I would like to make a statement on the National Health Service plan. WARE: This time, the annual increases of over 6% until 2004 were real and they matched the biggest on record. Mr Blair says the new investment is already delivering. It is true that the biggest hospital building programme is now under way. It's being funded mostly by private companies - who the public purse will have to repay over thirty years. The problem is, as Panorama showed earlier this year, there aren't yet the staff to operate all the new wards so some are closing. Panorama, 'Condition Red' 25th March 2001 HEAD OF ADMISSIONS: We do not close wards every day, thank goodness, so this is more pressure today. It's not good fun it's not a good day but we're doing the best we can. WARE: This ward had to temporarily close. Mr Blair acknowledges there's a lot to do. But he's also claimed he's done a lot. BLAIR [11 May 2001] We have laid the foundations for that. This extra investment that has now been going in to the Health Service. There are some 17,000 extra nurses, 6,700 doctors that are now in post. WARE: Once again, that's not quite as it seems. Many of those extra nurses are part time. The full time equivalent is nearer 11,000. That still leaves around 15,000 vacancies. A big expansion of medical schools is now underway, but most of the extra doctors Mr Blair claims credit for, were in the pipeline anyway. JOHN APPLEBY Chief Economist, The King's Fund I mean these are long-term things. I mean it takes time to train medical people and you've got to recognise that. I don't think the government could take credit for the numbers of doctors and nurse coming through now. WARE: But they are. APPLEBY: Well they really shouldn't do. I mean those are doctors and nurses coming through training places set up some years ago. WARE: So what about the future? All three parties say they aim to deliver a "world-class" service, though Mr Blair's rhetoric, perhaps, has been the most vivid. Mr Blair has said that under New Labour the NHS will become the most 'envied health care system in the world'. From being close to the bottom of the health spending league of European union countries, according to the Prime Minister, by 2005, we'll be up there - with the average! Even that seems unlikely. New Labour are committed to their present spending increases only until 2004. According to the King's Fund, even if they continue these increases to 2005 - the gap between Britain and the EU may even have widened since New Labour came to power. The Prime Minister defended his record on health in a BBC question and answer session with voters last week. BBC Question Time 30th May 2001 Man: Your manifesto promises for the health service are very much echoes of four years ago. Given this is a clear indication of your failure to achieve the results you wanted, why should we trust again? (Applause) BLAIR: We made actually pretty limited promises four years ago, in respect of waiting lists in particular, but I've got absolutely no doubt at all we've still got a massive amount to do in the National Health Service. DIMBLEBY: You said 48 hours to save the National Health didn't you? BLAIR: I said 24 hours to save... DIMBLEBY: 24 hours to save the National Health Service, well that's quite a big promise. BLAIR: Yes, but I didn't say within 24 hours I would transform the whole of the National Health Service. What I said was that because the Conservative proposals at that election, as incidentally with this election, are to push people out into private medical insurance, it was important that people voted for the party that believes in the National Health Service. However, I am the first to accept there is a massive amount still to do in the National Health Service. But I do say this to you, the only way we're going to deal with the problems that still exist in the Health Service, the problems of people waiting too long, the problems of insufficient nurses, insufficient doctors and consultants, the problems of having insufficient hospital buildings, the only way we are going to deal with this is to carry on making the investment in the National Health Service, and if we cut that investment back as the Conservative plans would mean, that would be a disaster for the future of the National Health Service. WARE: The Tories are committed to spending as much as New Labour on health but, like New Labour, only for the next three years. They believe one way of raising spending is to expand the private sector. So they're offering tax breaks to those who take the burden off the NHS by paying privately for treatment. WARE: Why should the British people trust the Conservatives to run the health service though, after 18 years, when waiting lists almost tripled actually from the early '80s to when you left office, and you left, as I say, the health service with such a staff crisis? Why should people trust you to not do that again? ANDREW LANSLEY Conservative We know that in the past the NHS has been an area where the public have viewed the Conservatives with suspicion and it has been a matter of political difficulty for us. We are committed, both because we believe it is the right thing to do and because it is also in government the successful thing for us to do politically to succeed with the NHS. WARE: The Liberal Democrats are pledged to spend £2 billion more each year than New Labour and the Tories - and throughout the whole parliament. But, having never been in government before, their ability to deliver remains untested. Two billion sounds a lot of money but actually it'll only increase the health spending as a share of GDP, our national wealth, by a 0.2% per year. That's not is it, it's not as much as it sounds. MALCOLM BRUCE Liberal Democrat Well we accept that it does not solve the long-term problem of our health service. We're not suggesting it does. What it will do is make a realistic ability to deliver on reducing the time that people are waiting for treatment. I think we do accept that there will have to be a hard rethink of the long-term investment in the NHS where other countries like France and Germany spend more. But we are anxious to be specific about what the taxpayer can fund and what that money will buy in very objective terms. WARE: In British terms the health spending plans of all three parties may seem ambitious. But a world class service will require sustained funding for much longer than any of them have committed to - whether from taxes, from more people going private or from a mixture of both. JOHN APPLEBY Chief Economist, The King's Fund It's nearly 40 years that we've been below the European Union average, or in other words countries like France and Germany have been investing in Health care at a higher level for much longer than the UK. WARE: This can't be fixed by one or even two Parliaments can it? APPLEBY: No, I think we're in for a long haul, and I think it's not just the government but the public must recognise that if they really want the investment in the Health Service to produce some results, it will take a long time. WARE: On Education, Mr Blair's ambitions back in 1997 were even greater than they were for the NHS. Like our hospitals, our schools, he said, would become "beacons" to the world. The Prime Minister said education was his "passion" It should be the nation's "moral purpose". Labour Conference 1996 BLAIR: Ask me my three main priorities for government and I tell you education, education and education. (Applause) WARE: The liberation of human potential, says Mr Blair, is the key to our economic and social revival. BLAIR: [1996 Conference speech] Give me the education system that's 35th in the world today and I will give you the economy that's 35th in the world tomorrow. WARE: As with health, four years ago New Labour's political broadcasts played on fears that the Tories would run down schools. Labour Party Election Broadcast 28th April 1997 FATHER: I mean your children are your future, and there's a whole generation who only know about run- down schools. That's no good is it? how is she going to learn in an overcrowded classroom. I'll tell you - it'll be difficult to find a decent school. Labour Party Election Broadcast 24th April 1997 When I say education, education, what that means is not just all the specifics of policy, it means I am going to put every single bit of drive and energy that I've got into changing the education system of this country. For me, education is the big passion. WARE: Mr Blair said he'd be 'radical' in government. The manifesto said New Labour would be a "pioneer of new thinking". But how true was that for Priority Number One? Prof ALAN SMITHERS Special Adviser House of Commons Education Committee Well the remarkable thing is, they came to power criticising Conservative education policy as really its great failure. But what they've done is actually taken over a large tranche of that policy. They've accepted the national curriculum, put in place further tests, beefed up the inspection service and continued with financial delegation to schools. All of these things were bitterly opposed by the Labour Party in opposition, but they've become the central planks of its education policy. WARE: With his impassioned rhetoric in '97 came Mr Blair's contract with the people. But, like health, it seemed less ambitious than the rhetoric: the manifesto promised to cut class sizes to under 30 - but only for 5, 6 and 7 year olds. WARE: It's true, isn't it, that they have kept their promise on primary schools? SMITHERS: Yes, and it was a very good promise. I mean one of the odd things about our education system is that we have fewer teachers in relation to the number of pupils in primary schools than we do secondary schools. So quite right to focus on bringing down the pupil/teacher ratio there. However, although the targets have been met, we have to bear in mind that the number of pupils have been falling. So it has taken hardly any extra teachers to actually achieve that target. It would, to a large extent, have happened anyway. Labour Conference 1996 BLAIR: I vow that class sizes will be down in primary schools and standards up in all schools. WARE: And there have been dramatic increases in children meeting literacy, numeracy and science targets. For eleven year olds - up more than 10% for English, 13% for maths and 16% for science. But while there have been advances in primary schools, there have been set backs in secondary schools. Last year pupil/teacher ratios were the highest since 1976, partly because the number of pupils has been growing. There are now nearly 90,000 more in classes over thirty than four years ago. As with health, New Labour inherited a growing teacher crisis. Would you accept that you bequeathed to New Labour, as you did with health, a staff crisis? ANDREW LANSLEY Conservative No I wouldn't, and I think if you listen to what the teacher unions have said over the last few months, they described the present teacher shortages and supply crisis as unprecedented. I heard a particular teacher union leader say it was the worst for a decade. Now of course if one goes back a decade.. WARE: It was growing under the Conservatives, it was getting worse year by year, particularly towards the end of your term in office? LANSLEY: Well there is.. inevitably there is a sense in which we were growing the economy, we were growing employment and some of the pressures on employment were occurring under the Conservatives as they have done since. But it has worsened significantly. WARE: It's Monday morning at the Times Educational Supplement - bible of the teaching profession. The faxes are rolling; the paper has already started receiving adverts for job vacancies. BOB DOE Editor, The Times Educational Supplement Last year we had unprecedented volumes of teachers ads. It was a record year last year. But even that has been overwhelmed this year by a 70% increase on that record level. WARE: Since New Labour came to power, vacancy levels in secondary schools have trebled. Vacancies in primary schools have doubled. For maths teachers, the vacancy rate has increased five fold. DOE: Whole departments in some schools are missing. There are schools that have no maths teachers at all, or may only have one maths teacher where they need four or five. That situation will get worse and it will be uneven. WARE: When he was in opposition five years ago the man who became Secretary of State for Education - David Blunkett - described the growing teacher shortage as a "ticking time bomb". The assumption was, that if New Labour became the government, they'd move swiftly to defuse it - but they didn't. Prof ALAN SMITHERS Special Adviser House of Commons Education Committee It hasn't shown the urgency in finding enough teachers that you might have expected. When David Blunkett was in opposition he was talking about the problem as being a ticking time bomb. But when he came to power he seemed to forget that. So it's an a cumulative problem. It was bad when New Labour came to power, it's worse now. WARE: So, whatever happened to 'education, education, education? Why had a government whose leader had spoken so passionately about education, who had vowed in his contract with the people to raise education to the nation's priority number one, why had such a government not got to grips straightaway with the growing teacher shortage crisis? The answer, of course, lies with New Labour's manifesto pledge on spending. As with health it committed the government to stick to Tory limits for the first two years. But it also committed them to reversing what they called "the Tory trend of cutting education spending." Labour Conference 1997 BLAIR: And I repeat the promise I made at the election that over the lifetime of this Parliament we will reverse the Tory policy of cutting spending on education as a proportion of our national income and raise it once again, beginning with the £1 billion extra next year. WARE: Nonetheless, education spending for the next year, as a proportion of our national wealth, fell to lower than all the Tory years. Partly this was because of higher than expected economic growth. The proportion was just as low in the third year too. Yet to listen to Mr Blair then, we were set for the start of a three year spending bonanza. Labour Conference 1998 BLAIR: We are rising, as a government, to that challenge - 19 billion pounds extra spending. WARE: That extra spending was promised over 3 years. In fact it didn't kick in until last year. And even then it wasn't quite what it seemed. The government had used the same 'triple counting' methods it had used for health to present the increase as £19 billion - in reality it was nearer to 10. BLAIR: [Party Conference 98] We've done more than we ever promised, and where we made promises, we are keeping them. WARE: It wasn't until last year - the fourth year of New Labour - that the promise was kept. Then education spending, as a share of national wealth, finally exceeded the last year of the Major government by 0.2 per cent. BLAIR: [October 97 Conference] Our goal is to make Britain the best educated and skilled country in the world. Prof ALAN SMITHERS Special Adviser House of Commons Education Committee I think the expectations generated by New Labour have led people to be looking forward to too much. In fact there are some substantial achievements that the government has to its credit. The literacy, numeracy schemes in primary schools for example, creating places in nursery education, rising performance at GCSE and A-Level continuing something that was happening before. All of these are achievements but they seem very little in relation to the reforms that the country was led to expect when New Labour came to power. WARE: Over the last four years, the education system that has been under-funded for so long has become increasingly overwhelmed. What solution to this crisis are the three main parties offering? Since last summer the government has committed itself to big increases in education spending, although the increase is not quite as much as health so it's still not quite priority number one. But the government is paying teachers more and it is providing more teacher training places. Mr Blair says this will deliver an extra10,000 teachers by 2005. How close will we be then to the Prime Minister's goal of having the best education system in the world? SMITHERS: Well 10,000 extra teachers will ameliorate the situation. But it won't take us back to the pupil/teacher ratios of even ten years ago. WARE: Under the Tories. SMITHERS: Under the Conservative Government, yes, and I don't know really how to put this into context but for example the ratio of teachers to pupils in state schools is about half that in independent schools. So even to move in that direction you're going to be looking for 100,000 teachers, or perhaps 200,000 teachers; 10,000 has to be seen in relation to that. WARE: Mr Blair faced some clear frustration on this subject from a BBC audience of voters this week. BBC Question Time 30th May 2001 WOMAN: Financially I'm worse off. I'm a secondary school teacher and I'd like to know where my taxes go because it certainly doesn't go into secondary schools and education? (Applause) BLAIR: Well, certainly there is a lot of investment that has gone into schools. I mean into primary schools as you know.. WOMAN: But secondary schools, Mr Blair. BLAIR: I'm just coming to secondary schools. Primary schools count as well you know. WOMAN: I know BLAIR: Into primary schools there has been a very large investment that has gone in, to capital stock as well as the schools themselves, and that's one of the reasons why we have got the best ever primary school results in this country. Now in the secondary schools, as you will know, this year your secondary school should have received money direct to the head teacher. When we came to office the funding per pupil had been cut by something like £30. It's been increased significantly, but again over the next few years there is a very substantial additional investment going into secondary schools. WARE: Liberal democrats are pledging £3 billion a year more than New Labour - and for the whole of the Parliament. They say they'll recruit nearly double the teachers New Labour have promised by putting up basic and top rate tax. WARE: It's an awful lot of teachers you're promising. At the rate at which people are leaving the profession it's a big, big, big step, isn't it? MALCOLM BRUCE Liberal Democrat As far as the actual numbers are concerned, they have been independently costed, they're based on Treasury figures, and again the Institute of Fiscal Studies indicates that they do add up, they are deliverable at that level of cost. And how else are you going to reduce class sizes? Reduced class sizes means more teachers - it's as simple as that. WARE: The Tories have promised to match New Labour's spending on Education, not for the full Parliament, but, like Labour, for three years. They say they'll make the money go further by cutting bureaucracy - as oppositions usually do - and by giving more freedom to Heads and Governors to reward good teachers. WARE: You kept education spending on a very, very tight rein during the 18 years of Conservative governments, why should we believe you? ANDREW LANSLEY Conservative Well, because I am saying it and I am saying it is a commitment that we want to do that because we've looked very hard, in an unprecedented way for an opposition party, looked very hard at public expenditure and identified where we can make savings and none of those savings impact adversely upon health and education. WARE: Standards may be improving, and they need to because Britain still has one of the highest levels of illiteracy in the western world. Recruiting and keeping teachers will be the major challenge for whoever wins the next election. New Labour's contract with the people in 1997 on transport was soothing: "We will help you get more out of life" it said. In opposition, Mr Blair graphically described the state of Britain's decrepit transport system. BLAIR: [1995 Conference] Our cities are congested, our roads are a driver's nightmare, our railways reduced to such a state that their latest timetable has as many false promises as a Tory Party manifesto. (Laughter and applause) This nation needs a proper national integrated transport system that serves that serves the people and safeguards the environment. (Applause) WARE: So what happened? When New Labour came to power they developed a set of long-term principles, shifting the emphasis from road building, which hadn't cut congestion, to public transport. Prof PHIL GOODWIN Former Adviser, Transport Department The problem has been converting those principles into actual practical reality, especially at the national level which has been slow and difficult, and sometimes confused. WARE: How many marks out of ten do you give them for delivery? GOODWIN: For the initial statement of principles I'd say a distinction. For delivery at the moment struggling for a pass mark. WARE: While congestion grew, there was a massive cut in transport spending. Under John Mayor's government it had averaged £13 billion a year. Under Tony Blair, that's gone down by £4 billion, the lowest on transport spending for fifteen years. WARE: But the Deputy Prime Minister still raised expectations within weeks of coming to office. PAUL BROWN The Guardian In his first speech as Environment Secretary John Prescott was talking about transport, and afterwards he spoke to journalists and he said I will have failed in five years time if there are not far more people taking public transport and far fewer journeys by car. And he said it was a tall order but he wanted us to hold him to it. WARE: More people are using public transport despite a functioning railway being almost brought to its knees by the crash at Hatfield. But there are also many more car journeys - sixteen billion vehicle kilometres more since New Labour came to power. We spend longer than ever crawling along at under 5 mph. Both New Labour and the Conservatives want to build more roads. New Labour has introduced legislation that allows local authorities to levy congestion charges. The Conservatives say they too want to reduce congestion, but they also say they'll scrap congestion charges and they'll cut fuel taxes! There seems to be a lack of logic in your proposals for reducing car congestion. You're going to encourage car use massively aren't you? ANDREW LANSLEY Conservative Well let's just have a look at what's been going on over the last four years because the price of petrol has gone up dramatically, the taxation on petrol has gone up dramatically, but because the government cut the roads programme and there has been no additional.. no substantial additional road capacity, the congestion is increasing, and the only result of congestion charging would be that people who are relatively well off will pay the charges and people who are poorer will have to travel at times not of their choosing or else give up using their cars for those journeys altogether. WARE: The real challenge for Labour or Conservative is to develop an efficient public transport system. Both claim they'll rebuild the railways and both are relying heavily on the private sector to achieve this. 17th May 2001 BLAIR: We will reform the way we invest in our railways and roads with long-term public and private partnerships that will, over ten years, be worth some £180 billion, the largest investment since the war in our transport system. WARE: A carefully reading of the Ten Year Plan set out in this glossy document reveals that the £180 billion is not quite what it seems. The true figure for investment - building new railways and building new roads - is £121 billion. The rest: £59 billion - is ordinary government operating subsidy, greasing the wheels and maintaining the roads, the kind of thing governments have always done. And even the £121 billion is by no means guaranteed. Take the railways - Railtrack was to have been the major private investor in the Ten Year Plan. But since the crash at Hatfield, Railtrack has been strapped for cash and the government can no longer rely on them to raise the money. Blair Question Time Clip 3 In 49.28 BBC Question Time 30th May 2001 Woman: It's been four years and for the last 3 years I have had problems day after day after day, getting into work, earning money to pay your taxes, and I don't see any difference in the train system whatsoever. (Applause) Everybody denies responsibility. Railtrack do, they blame the train companies, the prices are going up, the service is absolutely abysmal and I'm frankly sick and tired of having to travel to work on such an appalling service. It's awful. BLAIR: But surely the answer is to get the investment in. WOMAN: But who's going to put it in? Where's it coming from? No one is putting the investment in and it's not getting any better. BLAIR: But we are. We are committed now over the next few years to a huge investment in transport, but I do come back to what I said right at the very beginning. I know this is difficult because people would like everything to have been done very quickly. We had to stabilise the economy first, I said education would be the number one priority - it was. We then had the health service, we then have additional numbers of police, and now we have the money coming in for transport. WARE: Transport hardly featured in the last election and it's hardly featured in this. There may be plenty of plans and ideas, but there's no certainty that any of them will arrive at their destination. So why did New Labour achieve less on public services than they'd set out to? The answer lies in the decision they took to establish economic credibility through sticking to the Tory spending plans for the first two years. ANDREW DILNOT Institute for Fiscal Studies Gordon Brown and Tony Blair were very keen to present the Labour Party as a party of economic competence. I think the imperative was a combination of economics and also politics, that it was politically powerful for Labour to show that they had the stomach to deliver on the public finances even if it meant drawing things in pretty tightly for a while. WARE: The Conservative spending plans were already historically low. New Labour went still lower. DILNOT: Well they did the unheard of thing which is they more than stuck to their public spending limits. They delivered public spending that once you accounted for inflation was even lower in real terms than the Conservatives had said they were planning for it to be in the first two years of the Parliament. WARE: However, prudence did help deliver New Labour's key manifesto pledge of "stable economic growth and low inflation". Record debt was repaid which saved money on interest payments for future spending. The result has been the lowest interest rates for over thirty years and a more settled economy which has helped New Labour reduce unemployment. GORDON BROWN: Long-term unemployment is cut by two thirds and it's now at its lowest since the 1970s. WARE: With increased personal prosperity came increased tax revenues. The Chancellor's coffers were also boosted by the many extra taxes he introduced. Under Gordon Brown they rose nearly three times faster than under the Tories. Even so, for the first three years, little of these extra billions were spent on improving public services. DILNOT: They planned to increase public spending in the third year of the Parliament, but they didn't, they delivered another extraordinary low level of public spending. So in the first three years of the Parliament that's just come to an end we saw really very, very low levels of spending by historical standards on top of the last two years of the previous Parliament which also saw very low public spending. So we did see a five year period of almost unprecedentedly slow growth in public spending for a modern state. WARE: Also under New Labour, capital investment in our creaking infrastructure fared no better, which is surprising because New Labour warned of the folly of under investing. They complained there'd been a "dramatic rundown in investment, maintenance backlogs built up in schools, roads, council housing and the NHS. Last year the Government admitted that local roads were in their worst state for thirty years. The manifesto promised to switch spending from economic failure to investment, and under the Chancellor's tough new spending rules, he was still allowed to borrow to invest - but he didn't. DILNOT: The grip of the Government on this form of investment has been extraordinarily tight. Whether that's quite what it wanted isn't obvious. It's bobbled around half a percent of national income. That's an extraordinarily low level by historical standards. Indeed over that four year period we can't find any four year period where, on average, investment has been that low. WARE: At last week's Question Time Mr Blair defended his investment record. BBC Question Time 30th May 2001 BLAIR: When we came to office we didn't face a situation in which public spending was rising, on the contrary it was being cut. Now in the first two years, as I said earlier, we kept to those tough spending limits. We had to do that because we could not put the country back into debt again and we had to get the national debt down, and you wouldn't have mortgages where they are today if we hadn't done that. But last year, and this year, and for the next 3 years, health and education spending is receiving the biggest increase its received since the war. DIMBLEBY: But your slogan instead of last time round 'things can only get better', perhaps should have been 'things are going to get worse before they get better'. (Laughter and applause) BLAIR: No, I hope not. WARE: With the 2001 election campaign now in its closing stages, there's a critical date that looms beyond next Thursday. All three parties may be committed to delivering world class public services but 2004 is when the current big spending commitments run out. DILNOT: I think the choice that will face Labour, and indeed the other parties but Labour in particular, in 2003/4 is look do we want to go on moving public spending, in areas like health and education that we really care about, up towards the sorts of levels that we see on continental European economies, which necessarily means that we have to move our tax up as well? WARE: The Liberal Democrats are committed to raising the basic rate of income tax by 1p in the pound and increasing the tax rate to 50% for those earning over £100,000 per year. This, they say, will allow them to spend £8 billion more each year on public services than the other two parties. DILNOT: The Liberal Democrats are saying we should spend £8 billion a year more. £8 billion is less than one percent of national income. It will make a small difference. There will be a little wobble in where the UK is in the international ranking of public spending as a share of national income but it's really not going to transform things. WARE: It would be wrong to suggest that 8 billion more on public services is going to transform them MALCOLM BRUCE Liberal Democrat Well I think we know for example on health it's like... WARE: A tiny amount, isn't it. BRUCE: Well I don't think it is a tiny amount and I think to suggest that an accumulation of £8 billion a year on public services is a tiny amount is a misrepresentation. It is a... WARE: In the grand scheme of things. BRUCE: Well no, it's a targeted amount and you're quite right to ask the question and we've obviously had to make a judgement. We believe that the British people are prepared to find more money to invest in health and education and we've made a judgement of how much more we think they would find acceptable. WARE: The Tories have judged it makes sense to stick with New Labour's spending plans for health, education and transport - at least until 2004. They're also promising 8 billion pounds worth of tax cuts financed by cuts in public spending. They claim they can do this without cutting public services. ANDREW DILNOT Institute for Fiscal Studies Implicitly they're saying that they can run government as effectively as they did four years ago but with less money which rather begs the question of why they didn't do it then. I think there's no doubt that in the longer term if any party wants to commit itself to reducing taxation year after year, period after period, then that has to lead to reductions in the quality or quantity of public services. ANDREW LANSLEY Conservative The IFS, with respect to them, are wrong. We are not going to cut back on planned health and education spending and in further years I am confident.. WARE: After 2004? LANSLEY: After 2004, I am confident that the Conservative Party could pursue additional spending on health and education more successfully... WARE: At the present rate, at the present rate? LANSLEY: I can't commit to a rate, but more successfully than labour could do. WARE: But that's what it needs, isn't it, you can't just have a few years of.. LANSLEY: Well are the Labour party committed beyond that point? All we know of Labour is that they.. WARE: They have an aspiration to. LANSLEY: Well we have aspirations to increase public spending and to reduce taxes and only way we can do it... WARE: Yes, I know, so it's going to be harder for you, that's the point, it's going to be much harder for you to square the circle, isn't it? LANSLEY: Well the way we square the circle is by continuing to do what we've demonstrated we would do over the next two years which is make sure that public expenditure on things that the public regard as unnecessary or wasteful are reduced. WARE: New Labour is committed to the present increases in public spending but only until 2004. To continue with that increase would take the Chancellor into the red. Mr Blair says politics is about tough choices. So if he wins, he'll have one, in three years time, a stark one between again raising taxes or cutting back public spending. DILNOT: At the moment it looks to us as though a Labour Chancellor who wanted to increase public spending at the same rate that it's being increased at the moment beyond 2003/4 would be looking at needing to raise taxes by about £5 billion a year. That's the equivalent of adding close to tuppence on the basic rate each year. WARE: During this election Mr Blair has given few clues as to what choice he'll make in three years time. In the end, the choice for Thursday comes down to trust. BLAIR: There is a choice, at the election. You either get the investment into our public services, because they have been grossly under-invested in for a long period of time, or we carry on without the public services we want, but that is the choice. WARE: For all the differences accentuated by each party, it's worth remembering that when it comes to public spending no more than 1% of our national income separates New Labour from either of the two other parties. DILNOT: I think there's a lack of realism in the debate across all of the major parties about the trade off that is there. I think that commonsense tells us that if we really, really care about these services, we really, really want them to be good, then we're going to have to pay for them, and if we want to pay less we can have fewer of them and we'll jolly well have to pay for them ourselves, if we can afford to. If we want more of them, then we will have to pay more. WARE: Mr Blair has held out the vision of our public services one day being the envy of the world. The question is whether his party or any other has the candour to spell out the true cost of that vision. _________ If you want to comment on the issues raised in this programme you can contact our website. www.bbc.co.uk/panorama Next week Panorama reports on the risk of deep vein thrombosis and investigates how long the airlines have known the dangers. CREDITS Reporter John Ware Film Camera Jon Stapleton Sound Recordist Mik Gough Dubbing Mixer Stewart Harper VT Editor Boyd Nagle Graphic Design Kaye Huddy Julie Tritton Film Research Eamonn Walsh Shona Brown Production Team Rosa Rudnicka Rebecca Maidens Amanda Vaughan-Barratt Ben Peachey Production Manager Martha Estcourt Unit Manager Maria Ellis Film Editors Bob Hayward Geraint Evans Assistant Producers Sarah Gregory John Thynne Tracy Williams Producer Tom Giles Deputy Editor Andrew Bell Editor Mike Robinson 21 ______________________________________________________________________________________________________ Transcribed by 1-Stop Express Services, London W2 1JG Tel: 020 7724 7953 E-mail 1-stop@msn.com