What is the social market?

This is it: after a decade in the civil service, I’ve started this week as the Director of the SMF. Last night, at an event to mark this new phase for the think tank, I shared a platform with the Business Secretary, Vince Cable. I used to be a civil servant in his department. Whenever I spoke or wrote, as a matter of constitutional convention I did it on his behalf. Now I can disagree with him.

But, as it happens, the reason he came last night is because he is sympathetic to the social market approach. He talked us through its history and reflected that it has many friends in contemporary politics. That sent me searching for the best description of what the social market approach means.

One of our former Directors, Philip Collins, now chief leader writer at The Times, has offered that it was originally an idea of the European right imported to Britain by the dissident left. In other words, for a long time the social market approach was whatever David Owen did. A former Chair, Lord Lipsey, suggested that social marketeers are a “rump groupuscule of the extreme centre”.

Our current strap line is that we marry markets with social justice. Or as Mary Ann Sieghart, our Chair, has said we are “unafraid of market mechanisms, though determined to ensure outcomes are fair”.

For me the best way to exemplify our approach is to talk about the work we’re doing.

The first characteristic of that work is that we tackle big, puzzling issues with confidence. As an example, we’re undertaking research on the politics of housing looking at almost a century of party manifestos on housing and examining the political dynamics that may have changed the approach to housing over time.

A second characteristic is that, when we look at issues, as policy thinkers we’re not preoccupied by the role of the state. What happens outside the state is just as important, if not more so, for us. Hence we’ve done major work on rethinking the welfare state but we’re also looking at how to understand better the systems of private welfare that operate within families and across generations.

Turning back to the state itself, we are full-throated in our advocacy of public service reform. In fact much of our earliest work as an organisation through the 1990s was on this theme and it remains vital to us. I’ve mentioned the work on rethinking welfare. We’re just starting a new piece of research on access to independent schools. Current reform of the schools system may improve outcomes. But, if independent schools retain a premium, then the question for us is how to broaden access to them.

Finally we’re interested in our economic future and how we improve it. We’re doing new analysis on entrepreneurship, thinking about the role of start-ups in economic growth as well as the role of what you might call ‘re-ups’, businesses started by people who have been employees of other high-growth companies. Yes, we’d love to have entirely new businesses in the UK, but what about Intel, a company started by people who used to work at another company in the same sector and quit to start their own thing in the belief that they could do it better? Can we do more to encourage those entrepreneurs in the UK?

Equally there’s an argument that the British corporate life is overly dominated by the PLC. We’ve run a series of events recently looking at alternative company structures, exploring whether these can create a longer term perspective to economic growth or a different share of the spoils of growth between profits and wages.

I realise I ought to have a quip about the social market too. I’ll work on that and in the meantime prepare for the party conferences where the m-word (manifesto) will be in the air and we have a large programme of events that fits the bill I’ve described above.


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