Labour takes stock

The Prime Minister's Strategy Unit published a presentation on its website yesterday. Strategic Priorities for the UK: The Policy Review (PDF) is described as "background for Cabinet discussion of the policy review programme on 19th October 2006". It's quite an interesting, albeit discursive, overview of what the government sees as its key achievements and challenges. Economics editor Larry Elliott summarises the economic material in today's Guardian:

Tony Blair and Gordon Brown believe the economic stability the government has presided over since 1997 is a necesssary but insufficient condition for the big challenge of the next decade - tackling the threat posed by the big emerging economies of China and India.

Over the past decade and a half, the size of the global labour force has doubled to three billion as a result of the collapse of communism in the Soviet Union, China's embrace of the market and the arrival of India as a global economic force.

With the fast-growing developing economies having far lower levels of wages than those in the UK, Labour says the only option is a "knowledge economy" which specialises in sectors such as pharmaceuticals, biotechnology, environmental protection, nanotechnology and financial services.

These are areas where the UK has a tradition of strength, where the profits margins are high, and where the competition from India and China has so far been less evident than in low-cost manufacturing.

Labour has identified two areas that need to be addressed. The first is ensuring that Britain can compete in the lucrative high-skill sectors, where there is some concern that the UK spends less on research and development than its main rivals; that Britain's level of skills compares badly to those in the United States, Germany and Japan; and that the flow of new scientists may be drying up.

Although the government says educational standards have been rising, there are 7 million adults who are unable to read and write. At the other end of the spectrum, the number of undergraduates reading the physical sciences, engineering and technology has been falling, while fewer children have been taking maths and science at A-level.

The government's second concern is to ensure that growth benefits all groups in Britain. Labour admits the very poorest have not shared the benefits of growth, while inequality is more pronounced than it was in 1997.

Comments

[jon livesey]

It struck me as a pretty fair and balanced document, refreshingly free of Nu-Lab spin and hype. I was struck by one obvious problem in the tables - does anyone really believe Japan has no graduates in Mathematics and IT?

Another lack is a sense of finding incentives to get British students into Math, Computer Science and Physical Sciences. In the US there are some well-known anomalies in the workplace - people of modest talents can make way too much money on Wall St, for example - but by and large your lifetime earnings in the US are coupled to your educational achievement. If you want students in the UK to study difficult subjects, you have to reward them with decent salaries, and that in turn means that you have to promote start-up companies to employ and pay them. If the UK wants to play in the knowledge economy, the notion of the underpaid boffin who works for the love of it has to go, if it's not already on the way out.

[Lafayette]

"does anyone really believe Japan has no graduates in Mathematics and IT?"

If they got thier degrees outside of Japan, they would not likely be reported in Japan. Maybe. Depends how they gathered the stats.

[jon livesey]

"Depends how they gathered the stats". Exactly. That was my point. They're comparing countries by category of degree, when they've got some categorization problems.

But that's the minor part of my comment. My real worry is that we have a Government saying the right mush-words about hard sciences, but not doing too well in thinking up incentives. I worry that the UK is in a downward spiral, where the holders of soft degrees are running the show, and although they know to simulate the right sort of worry in public, they aren't about to do anything that could threaten their own position in the long run.

You really just have to compare what they say with what they do. What they say is that hard science is important. What they do in practice is try to get universities to admit more low-achieving students for socio/political reasons.

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