Fabian Tract s I J 

The Consumer Case for 
Socialism 

Chapter 

1. Introduction I 
2. What is Consumerism? 2 
3. The Politics of Consumerism 6 
4. A Critique of "Producerism" 10 
5. Consumerism and the Public Sector 14 
6. Poverty as a Consumer Issue 19 
7. Thinking Positively about Markets Zi 
8. Some Markers for a Labour Government 26 
9. Conclusion 32 
Martin Smith has worked in consumer affairs for seven years-as researcher, 
TV reporter, and Parliamentary lobbyist. He has written and broadcast widely 
on a range of issues, including retail banking and data protection, and was a 

.founder member of the Campaign for Freedom of Information . 
His other publications include Gypsies: where now? (Young Fabian pamphlet 
no 42) and Consuming Secrets, co-edited with Rosemary Delbridge (Burnett 
Books, 1982). 
The author wishes to emphasise that the views expressed in this pamphlet are 
strictly personal; they do not represent the policy of, nor have they been 
considered by, any of the organisations cited in the text. 

This pamphlet like all publications of the Fabian Society represents not the 
collective view of the Society but only the views of the individual who prepared 
it. The responsibility of the Society is limited to approving the publications it 
issues as worthy for consideration within the labour movement. 

July 1986 
ISBN 0 7163 0513 5 
ISSN 0307 7523 d._ 1-t 4 
Typeset by Spencers Ltd. 
Printed by B1ackrose Press (TU) 01-251 3043 8. ~s-Published 
by the Fabian Society, 11 Dartmouth Street, London SWIH 9BN 


../ 

I. Introduction 
In different ways both socialism and consumerism are, amongst other 
things, about confronting and changing existing arrangements for producing, 
distributing and administering goods and services. Both bring into 
question traditional assumptions about the location of power in society. 
Both are concerned with finding better ways of meeting people's 
needs. Both are, or should be, about the strengthening of democratic 
procedures. 

The parallels should not be overstated: 
there are major differences between the 
two. The socialist project, despite major 
setbacks in the Thatcher era, is more 
developed and better understood by the 
general public. Its traditions are far more 
deeply rooted within British political 
culture. Moreover consumerist ambitions 
do not always sit easily with the interests of 
all sections of an avowedly socialist labour 
movement; in certain circumstances indeed 
they may be in open conflict. But 
there are also convergences, both of principle 
and of interest, particularly in the 
provision of public sector services -an 
area to which consumerists have increasingly 
turned their attention in recent years. 

There are also important divergences, as 
well as convergences, in the direction of 
consumerist and socialist opinion . This is 
scarcely surprising since socialist parties, 
including the British Labour Party, are 
historically and ideologically rooted in the 
development of working class producer 
power. Labour Governments have always 
therefore been predisposed to focus upon 
the interests of working people as pro


ducers rather than as consumers. Thus 
while the Labour Government of 1974-9 
must be credited with some important 
"consumerist" achievements, it nevertheless 
failed to seize a number of important 
opportunities. For example in 
legislating for the reshaping of the 
management of local authority housing, 
the demands of the emerging tenants' 
rights movement were ignored in favour of 
the continuation of familiar bureaucratic 
procedures. 

This pamphlet explores the possibilities 
of synthesising socialist and consumerist 
ideas for politically progressive purposes. 
It begins by describing the main features of 
British consumerism. It analyses some of 
the more important convergences and 
divergences encountered in attempting to 
create this synthesis, stressing the former. 
Thirdly and most importantly, it outlines 
some of the ways in which the Labour Party, 
and a future Labour Government, 
should respond -selectively but positive-
ly-to the challenges which the consumer 
movement has laid down. 


l. What is 
Consumerisml 
The act of consuming or using goods or services may be functional or 
superfluous, enjoyable or unpleasant, tedious or interesting, according 
to context and circumstances. It is rarely worthwhile in itself. Such acts 
are universally necessary however, not least in making possible the pursuit 
of other activities which are in themselves worthwhile. We are only 
able to mine coal, operate word-processors, engage in politics, make 
music, run marathons, read books and care for each other because we 
eat, buy clothes, catch buses, have our wisdom teeth out and generally 
use or "consume" the products of other people's labour. 

These are self-evident propositiOns, but 
take us only some of the way to defining 
"consumerism". There are problems of 
language and definition to be resolved, or 
at least clarified. In particular, it is important 
to distinguish between the narrower, 
more traditional definition of the term, 
and its broader, more contemporary alternative. 


A broad definition 

All kinds of people -politicians, 
businessmen, trade unionists, journalists, 
and others-pay lip service to the interests 
of''consumers'' (usually those individuals 
who are not present to speak for 
themselves). And since for much of the 
time we are all consumers, we all like to 
think that we are qualified to speak on 
"the consumer's" behalf. It is not surprising 
therefore that the word "consumerism" 
is sometimes seen as imprecise 
and ambiguous . 

In practice, the word "consumer" can 
be defined in two ways: it is used in a narrow, 
relatively familiar sense to describe 
problems associated with the consumption 
of High Street goods and services; and, 
more broadly, in relation to problems aris


ing from contact with public sector services 
like council housing and the social 
security system. The wider definition is implicit, 
for example, in the content of a 
number of popular radio and television 
programmes which carry the "consumer" 
label, programmes like You and Yours 
(BBC Radio 4), That's Life (BBC!), and 
For What It's Worth (Channel4). The National 
Consumer Council has adopted this 
wider definition in its remit. 

This broader interpretation is comparatively 
new, and is not yet widely accepted. 
People rarely see difficulties 
associated with the receipt of unemployment 
benefit or the availability of public 
transport as "consumer" problems in a 
generic sense. Even amongst consumer affairs 
specialists, most of whom have now 
adopted some variant of the broader 
definition, there is uncertainty as to where 
the lines should be drawn. This is particularly 
apparent in the environmental 
field. For example, the pollution and risk 
to health created by the emission of 
asbestos dust into the atmosphere by certain 
forms of disturbance in tower blocks 
of a given construction is a consumer problem, 
some would argue; but if so, it can 
then be argued that all environmental problems 
are "consumer" problems, and the 

2 


word may become so all-embracing as to 
be meaningless. 

A different kind of objection was 
highlighted by The Times in a leader on 31 
August 1984 which attacked the National 
Consumer Council's wide-ranging critique 
of the social security system, Of Benefit to 
All. The writer disapproved of the practice 
of comparing the dealings which the 
citizen has with the state with those that 
the private consumer has with marketplace 
supplies of goods and services. 

Now clearly there are important differences 
between state/citizen and producer/
customer relationships but these are 
relatively unimportant to most people's 
perceptions of them. A given product or 
service may be supplied from a private or 
from a public source; but what matters 
most to the beneficiary, whether described 
as consumer or user, are over-arching considerations 
such as quality, reliability, 
safety and value for money. Thus the 
customer who is in dispute with an area 
electricity board over the size of a bill or 
faults in an electric cooker is unlikely to be 
much concerned about the board's ownership 
status. The argument applies equally 
to disputes between, say, individual 
policy-holders and private sector insurance 
companies. The politics of "consumerism" 
is rooted primarily in perceived 
reality (how well does it work?) not in objective 
political economy (what is my relationship 
with the producer?). 

For these reasons I propose an alternative, 
more dynamic definition. Consumerism 
is the organised expression of 
the aspirations ofthe consumers and users 
of goods and services for greater control 
over their immediate environment. The 
general argument of this pamphlet relates 
to this definition -one which embraces 
every conceivable kind of supplierI 
receiver relationship, is political in its basic 
assumptions, and which clearly implies a 
commitment to change. 

The principles of 
consumerism 

The major principles of consumerism are 
those of choice, access, information, safety, 
representation and redress. The concepts 
of quality, reliability and value for 
money are also clearly important. 

Choice and access 

The meaning of choice is widely 
understood, but real choice assumes 
unrestricted access. In practice, the enjoyment 
of multiple choice in the consumption 
of most goods and services is unequal, 
because access may be constrained by a 
variety of factors including levels of 
disposable personal income, geographical 
location and personal mobility. The actual 
choices available to consumers who are, 
for example, unemployed or disabled, or 
who live in remote areas, are often few and 
sometimes even non-existent. 

Information 

The need for consumers to have access to 
full and reliable information is closely 
linked to the choice principle. Inadequate 
information leads individuals to make 
uninformed and disadvantageous choices. 
The' 'right to know'' is fundamental to the 
work of product-testing organisations 
such as Consumers' Union in the USA and 
Consumers' Association in the UK. Information 
is obtained, verified and passed on 
to subscribers through the medium of 
publications like Which? magazine to advise 
members which products are most appropriate 
to varying needs. Consumer 
organisations also campaign for fuller and 
better quality information in areas as 
diverse as drug labelling and the disclosure 
of car accident data to enhance public 
knowledge and to raise health, safety and 
performance standards. . 

In some countries consumer orgamsations 
have extended the "right to know" 
principle beyond product information by 

3 


campaigning against government secrecy 
and for Freedom of Information legislation. 
Consumer representatives, with 
others, have argued that large quantities of 
official information embracing matters of 
public policy as diverse as nuclear power 
and alcoholism are collected, processed 
and stored at taxpayers' expense; and that 
in principle therefore the taxpayer, both as 
citizen and as "consumer" of state-
provided services, should enjoy enforceable 
rights of access to relevant 
documentation. Their pursuit of the goal 
of "open government" is perhaps the best 
illustration of the willingness of many consumer 
organisations to reach beyond traditional 
consumerism on the narrow definition. 


Safety 

The importance of the principle of safety is 
self-evident in the physical sense. People 
have an obvious right not to be exposed to 
exploding car fuel tanks, lethal hair dryers 
or toy dolls with three inch spikes in them. 
But the safety principle can also be extended 
less obviously into the economic sphere. 
Much of the interest that consumer 
organisations take in the reform of company 
and insolvency law is based on the 
premise that fraudulent and exploitative 
business practices -"rip-offs" of one 
kind or another -infringe precisely this 
principle of economic safety. 

Safety is a particularly important consumer 
issue on the international stage. The 
International Organisation of Consumers' 
Unions (IOCU) has shown that worldwide 
there are many dangerous products 
on the market creating serious problems 
for developing countries. For example, 
certain multinational drug companies use 
such countries in effect as dumping 
grounds for sub-standard goods. 

Representation 

The consumer's right to representation 
stems from the interdependence of the 

4 

economic interests of producers and consumers. 
Consumers, it is argued, should 
therefore have a say if not in the productive 
process itself, then certainly in the 
planning and supervision of that process. 

In practice of course, the problems are 
far from straightforward. In the private 
sector hardly anything has been achieved 
in Britain by way of direct representation. 
Business interests have generally rejected 
formal consumer representation by arguing 
that sovereignty in a market economy 
already rests with the consumer through 
competition and individual choice. This 
assumes a responsive and arguably 
somewhat negative role for the consumer 
in the market-place and for that reason 
alone is unsatisfactory. Nevertheless, such 
assumptions have rarely been challenged 
by UK consumer organisations, with the 
notable exception of the Public Interest 
Research Centre in the 1970s. 

In the public sector, consumerists have 
been able to argue that consumer representation 
is a necessary proxy for lack of corn-
petition. People who travel by train, live in 
a council house or run a gas central heating 
system, it is argued, are dependent upon a 
monopoly supplier. There is no market, 
and little or no consumer choice. In the 
absence of competition, direct consumer 
representation is required to ensure efficiency, 
fair dealing, reliability and value 
for money. 

The Attlee Government created a network 
of Nationalised Industries Consumer 
Councils (NICCs) between 1946-8, though 
there have been subsequent modifications. 
Based mainly on regional structures, 
the main function of the NICCs is 
the handling of consumer complaints. The 
NICCs undoubtedly perform a valuable 
complaints-handling role at regional level. 
In addition, their national bodies, notably 
the Electricity Consumers' Council, have 
also published some impressive policy 
documents in recent years. In general 
however, the NICCs have been ineffective 
in policy terms. They are heavily constrained 
by inadequate powers and insufficient 
funds, and are rarely consulted until 
after key industry decisions have been 


taken. There is a strong case for completely 
rethinking a strategy for consumer 
representation in the nationalised industry 
sector. 

Redress 

The next principle -redress when things 
go wrong -is increasingly familiar to the 
general public, and is now well-entrenched 
in law as regards many supplier/ customer 
relationships in the market-place. This is 
true both of the civil law, which enables 
citizens to pursue their civil rights in relation, 
for example, to the sale of goods; and 
of the criminal law, which empowers the 
state itself to act against unscrupulous 
traders and others on the citizen's behalf. 
The wronged consumer is now eligible for 
compensation in a variety of circumstances. 
And offending suppliers may 
be severely punished. 

The law of weights and measures is centuries 
old. The Sale of Goods Act, which 
says that all goods must be described correctly, 
fit for the purpose for which they 
were bought and of ''merchantable 
quality", still key concepts in consumer 
law, was first codified and put onto the 
statute book as long ago as 1893. More 
recently, consumer advocates have per


suaded Parliament to enact further 
statutory protections relating to consumer 
safety, trade descriptions, consumer 
credit, unfair contract terms and the supply 
of services. 

The cumulative effect of this legislation 
is to give considerable rights of consumer 
redress in the private sector. The pattern is 
more complex and much less satisfactory 
in the public sector where problems arise 
from complaints against the Department 
of Health and Social Security, local education 
authorities, the National Health Service 
and so on. Even in the private sector, 
however, there are a variety of outstanding 
problems, some reflecting ambiguities or 
gaps in the law, some the inadequacies of 
law enforcement (notably in the resources 
available to local authority trading standards 
officers), and others the difficulties 
many people experience in gaining what is 
increasingly called "access to justice" 
(redress through the courts). 

Because in Britain awareness of some 
consumer principles has penetrated extensively 
throughout all social groups, it is 
easy to forget that in many countries the 
principles themselves are perceived as alien 
or eccentric, and that they are generally 
unenforceable even where they are 
recognised. 

5 


J. The Politics of 
Consumerism 
If consumerism is ''the organised expression of the aspirations of the 
consumers and users of goods and services for greater control over their 
immediate environment", it is inescapably a political activity. Equally 
however, it is a species of politics which is difficult to accommodate 

within conventional categories ideology. 


The diffuseness of the UK 
consumer movement 

The UK consumer movement includes the 
traditional consumer watchdogs (prices, 
weights and measures) and a newer generation 
of professionals and lay activists 
(home energy audits, disability benefit advice 
and much more). It is not surprising 
that this produces a wide variety of 
political stances in both ideological and 
organisational terms. The political views 
of the individuals involved span a range of 
positions including radical neo-liberalism, 
paternalist Toryism, strong support for 
centralised regulation and intervention, 
and decentralist socialism. 

This astonishing mix is evident in the 
proceedings of the Consumer Congress, 
the major event in the consumer calendar, 
which meets once a year in early Spring. 
Congress is a coalition-building initiative 
launched by the National Consumer 
Council. It brings together 200-300 
delegates and professionals from a wide 
range of affiliated organisations, plus 
journalists, observers of various kinds and 
the odd politician. It is the only vehicle 
through which organisations as diverse as 
the Association of Community Health 
Councils for England and Wales, the National 
Gas Consumers' Council, the 
Housewives Association, the Child Poverty 
Action Group and Transport 2000 are 

whether of party , pressure group or 

able to signal their identification with the 
British consumer movement. 

Congress offers an annual forum for the 
discussion of policy, and a meeting place 
for otherwise isolated activists. In between 
Congresses, those who attend it either as 
delegates or as individuals get back to 
fighting their own battles -as tenants' 
leaders, electricity complaints' handlers, 
trading standards officers or advice 
workers. These activities take place unconnectedly 
for the most part. The consumer 
movement, in short, has a head (Congress) 
but no full-time co-ordinated body. It 
draws on no mass membership, no radical 
tradition (of organised boycotts for example) 
and no funds of any significance; it 
possesses a skeletal organisation (the Congress 
secretariat) and wields little independent 
political clout. 

The relative weakness of the consumer 
movement can largely be attributed to inexperience 
and severe resource constraints. 
But it also reflects the fact that in 
one key respect, its theoretical foundations 
are dangerously fragile. Consumer 
theory is a theory of divided self. Many of 
us have producer-roles; all of us have 
consumer-roles. The problem for the consumer 
interest arises because there is from 
time to time a conflict between these roles 
-within individuals, as well as between 
groups of individuals. Thus a steelworker's 
interest in obtaining the max


6 


imurn negotiable wage for his work conflicts 
with his desire to pay the lowest 
possible price for a new British-made car. 

In spite of this inescapable contradiction, 
consumerism does possess an ideology 
which is not only distinctive but also 
coherent -an ideology which flows from 
the principles outlined above and is 
characterised by an overriding determination 
to ensure that the consumer gets a better 
deal in each and every transaction he or 
she makes. This practical common ground 
is sufficient to ensure that the coalition 
does hold together. But it is a diffuse 
ideology. It does not lend itself to comprehensive 
and cohesive political expression 
of the kind associated with political 
parties. There could not be a "Consumer 
Party"; it would collapse the moment it 
first seriously engaged with the problems 
of macro-economic policy. Consumer activists 
are well aware of this; their aim is to 
influence the existing political parties, not 
to create a new one. 

The ambivalence of the 
Left 

For many socialists, the images and 
associations of consumerism have been, 
and continue to be, predominantly 
negative. Attitudes in the labour movement 
have ranged from suspicion and 
neglect to outright hostility. 

Socialists have generally perceived consumerism 
in an undifferentiated way. 
Many, deploring the apparently insatiable 
materialism of the West with its incessant 
marketing of sometimes superfluous 
gadgetry, have regarded consumerism (on 
the narrow definition) as a wholly 
undesirable phenomenon. Consumerist 
activity is seen as having more to do with 
the indulgence of wants than the meeting 
of needs . 

This view reduces consumerism to what 
would more accurately be described as 
consumptionism, an arid and selfish creed 
as inescapably capitalist as Lombard 
Street or Madison Avenue. (The word 
"consumer" is of course frequently used 

as an epithet to describe contemporary 
capitalism.) 

A softer, more ambivalent socialist 
perspective, characteristically male, 
recognises the usefulness of Which? 
magazine and endorses the efforts of those 
who campaign, for example, for better 
nutritional labelling. But it dismissively 
associates product testing or product information 
with an outdated image of 
womens' institutes and townswomens' 
guilds, organisations which are assumed 
(often mistakenly in recent years) to be 
deeply immersed in Tory politics. 

Then again-a more neutral perception 
-although most people on the Left are 
happy to join in the applause for the successful 
prosecution of a loan shark or a 
cowboy builder, few recognise that the 
kind of programme which would effectively 
put such crooks out of business has 
anything to do with socialist politics, even 
though they prey disproportionately upon 
working class communities. Many traditional 
socialists are simply not impressed 
by ideals and goals which are concerned 
with quality, fair trading or redress-the 
elimination of faulty goods and bogus 
advertising claims or compensation for the 
victims of the kind of rogue directors who 
repeatedly rip their customers off in 
"change the name, start again" rackets. 

It is possible from any of these perspectives 
to claim that consumer evils will 
disappear with the socialisation of the 
means of production, distribution and exchange. 
A less fundamentalist response 
would be to argue that consumer problems 
are indeed important; but to add that for 
practical political purposes -setting 
agendas and determining priorities -they 
are second-order and not first-order problems. 


These matters are all clearly arguable; 
but the point to note here is that the Left in 
general, and the Labour Party in particular, 
being historically, ideologically 
and organisationally rooted in working 
class producer power has inevitably tended 
towards a "producerist" view of political 
economy. The role of the trade union 
movement has been and remains central. 

7 


The unions' raison d 'et re is the advancement 
of their members' interests at the 
point of production; they are not equipped 
(nor is there any reason why they should 
be) to represent their members' interests at 
the point of consumption. And consumers' 
interests are not similarly (that is 
constitutionally) represented within the 
labour movement. 

Insofar as the objective interests of 
some sections of organised labour actually 
conflict with those of consumers in particular 
circumstances, it is not surprising 
that union attitudes towards consumerism 
should have veered on occasion towards 
outright hostility. The debate about the 
Shops Bill was a case in point: the Union 
of Shop, Distributive and Allied Workers 
(USDAW) opposed Sunday trading; consumer 
organisations were (and remain) 
strongly in favour of it. More generally, incomes 
policy, trade policy and competition 
policy are all areas of actual or potential 
conflict between some trade unions 
and some or all consumers. 

In general however, hostility on the Left 
has been less in evidence than simple 
neglect. One reason for the neglect of consumerism 
has been its relative 
powerlessness. The leaders of the UK consumer 
movement do not enjoy easy access 
to cabinet ministers comparable to, and on 
the same scale as that enjoyed by the CBI 
and (in other times) the TUC. Politics, in 
this sense, accurately reflects the structure 
of power relations in contemporary society. 
The consumer movement, like the 
women's movement, has suffered from 
one of the pervasive cultural prejudices of 
labourism which dictates that if you have 
no muscles to flex then you don't compel 
attention. 

The consumerist advance 

In spite of these obstacles, the cause of 
consumerism has advanced steadily over a 
period of some thirty years. It has done so 
under governments of both parties, a fact 
which reflects the consistent determination 
of consumer leaders not to place their 

organisations in hock to any political party. 


The event which signified the beginning 
of the advance was the birth of the 
product-testing organisation Consumers' 
Association (CA) in 1957. CA, the 
publishers of Which? magazine, is now 
supported by an astonishing 750,000 
subscribers. It was founded by Michael 
Young, a former Secretary of the Labour 
Party's research department. Young's extensive 
range of political contacts were, 
not surprisingly, mainly on the Left. 
Nevertheless it was the Conservative 
Government of 1959-64 which produced 
the first official responses to the new-style 
consumerism. The Molony Committee on 
Consumer Protection reported in 1962 
(HMSO., Cmnd 1781), and led directly to 
the creation of a new publicly-funded 
body called the Consumer Council 
(1963-70), later abolished by the Heath 
Government. The enactment of the Trade 
Descriptions Act 1968 also owed its origins 
to Molony. 

The next significant reforms followed 
the appointment of Sir Geoffrey Howe as 
Conservative Minister for Consumer Affairs 
in 1972. Howe took through the Fair 
Trading Act 1973, creating the Office of 
Fair Trading (OFT) and establishing the 
role and duties of its Director-General. He 
also supervised the preparation of the 
Consumer Credit Act 1974, although this 
Bill was enacted under Labour in a bipartisan 
spirit. Both measures have been important 
in helping to strengthen the position 
of the individual consumer in the 
market-place. 

It was during the period of the Labour 
Government of 1974-9 that consumerism 
on the broad definition really came of age, 
a process to which the Government itself 
made a major contribution. In September 
1974 the new Department of Prices and 
Consumer Protection (DPCP) published a 
White Paper entitled National Consumers' 
Agency. This contained the remarkable 
statement that: 

Those concerned in the production of goods 
and services are extensively involved with 
Government in the national counsels 

8 


through the TUC and CBI. The role of the 
consumer in economic activity is as important 
as that of the producer, and the 
Government considers that the consumer 
ought through the new Agency to have a 
similar opportunity to be heard. (Emphasis 
added.) (HMSO., Cmnd. 5726) 

One year later the "new agency", the National 
Consumer Council (NCC), was duly 
created with, inevitably, Michael Young as 
its first chairman. The NCC's terms of 
reference were (and are) to represent the 
interests of consumers to other bodies, 
notably central government itself, local 
government and the nationalised industries. 
Interestingly, the Council was 
given a specific remit to look after the interests 
of inarticulate and disadvantaged 
consumers . 

These two decisions -the establishment 
for the first time of a DPCP with its 
own Secretary of State and of the NCC were 
acts of major political importance for 
the development of consumerism. In 
retrospect they appear all the more impressive: 
it was not an easy matter for a 
producer-dominated party to make that 
kind of commitment to the pursuit of consumerist 
objectives. 

This commitment was extended into a 
variety of areas of consumer interest-on 
both the narrow and the broad definitions. 
It was apparent in the work of the Price 
Commission, also created at this time, and 
in the establishment of Community Health 
Councils (CHCs) in 1977 . 

But there were disappointments too. 
Public dissatisfaction with what was felt to 
be the poor performance and bureaucratic 
unresponsiveness of large parts of the 
public sector was nsmg. Labour's 
response was piece meal and incomplete. 
In particular there was a serious missed opportunity 
in the public housing field . The 
Government failed to act to transform the 
semi-feudal status of council house tenants 
by legislating along lines proposed by the 
NCC and the National Tenants' Organisa


tion, thereby opening up the way for an incoming 
Conservative Government to 
legislate for qualified tenants' rights 
(though in a quite different spirit) after 
1979. 

The emergence of tenants' groups and 
the growing demand for greater user control 
over the management of the public 
housing stock illustrates what has been the 
most important feature of the continuing 
advance of consumerism over the last 
decade or so -the expansion of its range 
and scope. Product testing remains a centrally 
important activity; but the consumer 
as tenant, or pupil/parent, or patient, or 
transport user, or claimant, now provides 
the focus for the work of many younger 
activists, some of whom are based outside 
the mainstream consumer organisationsin 
womens' groups, parents' groups, advice 
and information bureaux and 
elsewhere. It is interesting to note that the 
development of this trend paralleled the 
growth of a different form of "consumerism" 
in the Labour Party itself; the 
campaign to extend intra-Party democracy 
in relation to leadership elections and the 
re-selection process drew on many of the 
same basic principles. 

Clearly there is a tension within the consumer 
movement between those whose 
preferred emphasis is upon individual consumer 
rights, in the market-place and 
elsewhere, and those who stress the collective 
dimension of the rights of groups of 
service users. These differences of outlook 
have been heightened by the impact of 
Thatcherism. The tension is nevertheless a 
creative one, and there are no signs of impending 
schism. The consumerist advance 
has perhaps been strengthened by the very 
diversity of its ideological strands. Above 
all, it has been held together by the shared 
conviction that the balance of forces between 
producers and consumers is in need 
of correction in favour of those who foot 
the bill. Hence the challenge to 
''producerism'' . 

9 


4. A Critique of 
''Producerism'' 
Neil Kinnock has rightly stressed the necessity for the Labour Party to 
take on the mantle of "the party of production". There is indeed a need 
to make far better use of our productive resources, for employment and 
for other reasons. But to achieve this requires casting off the inheritance 
of what, for want of a better word, I shall call "producerism". By this I 
mean the habit of producing things without sufficient regard to the requirements 
of the consumer; or, at a stage removed, the custom of planning 
economic, industrial and social strategy in exclusive accordance 
with the wishes and convenience of producers and administrators. 

The quality factor 

In certain key respects socialists have been 
too "producerist" in their traditional attitudes. 
There has been a failure to 
recognise and act upon the importance of 
the link between indices of output and indicators 
of quality. Many people are aware 
that the statistical indices of output have 
made dismal reading in recent years, but 
few have been willing to acknowledge that 
one of the reasons for this has been that 
over a much longer period, what the UK 
has produced has simply not been good 
enough to beat the competition, either at 
home or abroad. The simplified case 
against the bias of "producerism" is that 
as a nation we have not been prepared to 
square up to that fact, or to do enough to 
put things right. 

Issues of quality (how good is the thing 
being produced?) are relevant to issues of 
quantity (how many can we produce and 
find a market for?). Too many UK 
manufacturing sectors, for example 
machine tools, motor cars, motor-cycles 
and electronic goods, acquired a reputation 
for serving up items of inferior quality 
supported by inferior after-sales service. 
For a nation which still lives substantially 
upon what it can sell to other countries, 
this reputation was bound to have an 

adverse effect upon overall economic performance. 
It has worked doubly to our disadvantage 
-as a contributory factor in a 
generally poor record of export achievement 
and of unacceptably high levels of 
import penetration. Both factors were 
acknowledged in the highly critical 1985 
report of the House of Lords Select Committee 
on Overseas Trade (Vol. 1, Report, 
HMSO). 

Of course there have been other factors. 
The poor performance of UK manufacturing 
industry in recent times must in any 
balanced account be related, amongst 
other considerations, to mistakes in trade, 
monetary and exchange rate policy, inadequate 
levels of investment, inferior 
management, indifferent labour relations 
and a poor record of innovation in key sectors. 
It is easy to find ways of excusing this 
record; equally, it is self-delusion to do so 
without acknowledging that what we have 
produced has too often been over-priced, 
shoddy, technically backward or otherwise 
unappealing by comparison with the 
manufactured goods produced by our 
competitors. Economists and politicians 
may argue about the precise relative weight 
which should be given to each of the 
available explanations; in the end however 
(and for some industries, for example 
motor-cycles, it has indeed been the end), 

10 


it is the consumer at home and abroad who 
has delivered the decisive verdict. 

At the level of strategic industrial planning 
it is most important that socialists 
should learn the lessons of this experience. 
The antidote to "producerism" is to build 
consumerist criteria into national and 
regional planning policy. In terms of the 
strategy outlined in Labour's Programme 
1982 (still the most detailed available) this 
means providing for systematic consumer 
inputs into the work of the new Department 
of Economic and Industrial Planning. 
(It is not clear exactly what the status 
of the 1982 proposals now is, but the point 
is valid irrespective of the precise form of 
changes to the machinery of government.) 

No form of economic planning can entirely 
anticipate or supersede the workings 
of the market-place for any product. It is 
possible, however, to influence market 
outcomes. The conditions attached to industrial 
development grants, for example, 
could include explicit reference to expectations 
on product quality. Practical support 
could be offered by the establishment of 
regional product-testing laboratories to 
supplement and build upon the work 
already done by the British Standards Institution 
(BSI) whose role would sensibly 
be expanded, Consumers' Association and 
existing specialised government laboratories. 
The results of such testing work 
should be published in order to promote 
incentives and achieve competitive movement 
upwards on product quality. 

One feature of this approach would be a 
much tougher line on product safety. The 
doctrine which appeals naturally to the 
"producerist" mentality-caveat emptor 
(let the buyer beware) -is simply unacceptable. 
On this issue, state intervention 
in the market-place should be uncompromising. 
Traders should not be free to 
sell goods which are actually or potentially 
dangerous in use. 40,000 accidents a year 
(in England and Wales) attributable to 
dangerous electrical products alone provide 
a sufficient reason for enacting 
stronger legal safeguards, vigorous policing 
by enforcement officers, and the promotion 
of higher standards of production. 

The case for a systematic approach to 
product quality issues extends way beyond 
the safety argument however; the need to 
raise production standards goes to the 
heart of the question of improving the international 
competitiveness of UK industry. 
Better quality products, other 
things being equal, means more exports 
and fewer imports. To achieve that, we 
need higher standards, more standards, 
and a greater rate of compliance with these 
standards on the part of home-based producers. 


Good progress has been made as regards 
the measurement of quality. We now have 
more than I 0,000 scientifically-devised 
British Standards, and the BSI has also 
developed excellent procedures for quality 
assurance -the maintenance of consistently 
high standards. Compliance is 
almost entirely voluntary however, and 
there is no doubt that much of what is produced 
in the UK is still of inferior quality. 
Approximately half the products submitted 
to the BSI for certification are failed, 
giving cause for more than a little anxiety 
about the quality of products not submitted. 


There is a case for applying mandatory 
standards in some sectors, particularly 
where large export markets are involved. 
This would be done on the basis of compulsory 
certification. There is a difficult 
tension here between the principle of consumer 
choice (competition by price) on the 
one hand and the enforcement of 
minimum standards (consumer protection) 
on the other. But even in an entirely 
voluntary order of things, producer and 
public consciousness of quality considerations 
could be dramatically enhanced by a 
more vigorous high-profile government 
commitment to the BSI's Kitemark and 
Safety Mark schemes, or their equivalent. 

There is an important and rarely considered 
role for public enterprise in this 
context. A socially-owned company, 
British Leyland -particularly in the years 
of the Allegro and the Marina -acquired 
a reputation for building second-rate 
motor cars. The image of public ownership 
amongst BL's customers was serious


11 


ly damaged. This legacy must be turned 
upside down: publicly-owned enterprises 
should lead on quality, setting higher 
market standards and challenging others 
to match them. This cannot be achieved 
unless the positive influence of consumerism 
is drawn into the productive 
process. Quality control should be regarded 
as an essential component of socialist 
planning, not just as an instrument of factory 
management. 

The systematic application of consumerist 
criteria must also feature in the 
development of a socialist trade policy. 
Labour's existing policy of planning import 
growth by setting import penetration 
ceilings on an industry-by-industry basis is 
justified, in spite of its implied constraints 
upon the exercise of full consumer choice, 
provided firstly that adequate measures 
are taken to ensure that protection does 
not result in the domination of UK 
markets by over-priced, home-produced 
goods of inferior quality, and secondly 
that the opportunities afforded to industry 
are not frittered away through underinvestment 
in plant and machinery. 

People will accept a policy of planned 
import growth only if its objectives are 
clearly articulated in terms which relate to 
everyone directly as consumers, and not 
just to some of them as producers. The 
trade-offs between long-term economic 
viability and job creation at the cost of 
diminished short-term freedom of choice, 
should be clearly explained. The merits of 
full or partial protection for given 
manufacturing sectors must be advocated 
not only in terms of creating jobs but also 
of enhancing consumer choice in the 
longer term. This kind of approach must 
be deployed within the framework of an 
interventionist industrial strategy which 
consciously and explicitly works towards 
goals which are as consumerist as they are 
"producerist". 

"Producerism" in 
government 

Government itself therefore has a crucial 

role to play in counteracting the imbalances 
perpetuated by "producerist" 
bias. This is easy to assert but will be formidably 
difficult to follow through. Many 
influential quarters within government 
departments have been "captured" intellectually 
by producer perspectives over 
the years. The Ministry of Agriculture, 
Fisheries and Food in particular was 
dominated by the National Farmers' 
Union for so long that it has sometimes 
been used as a case-study of the incorporation 
of a pressure group into government. 
Similarly, the Ministry of Transport was 
locked in symbiotic embrace throughout 
the 1950s and 1960s with the roads lobby, 
an informal coalition which embraces interests 
as diverse as the motor manufacturers, 
the road haulage industry, the 
transport unions and the motoring 
organisations. The recent relativ\! decline 
in the influence of the roads lobby in 
government has had as much to do with 
public spending constraints as with any 
fundamental shift in departmental thinking. 


The development of government energy 
policy since the establishment of a separate 
Department of Energy in 1974 provides 
the best example of this theme. The 
Department of Energy is run by civil servants 
whose collective expertise is overwhelmingly 
derived from supply-side (or 
production-oriented) approaches to 
energy problems. The organisation and 
staffing of the Department, and its internal 
allocation of resources, reflects this 
bias; thus the Energy Efficiency Office, 
which carries the energy conservation 
remit, has a pitiful total budget of £20 
million. The basic working assumption 
behind departmental thinking has tended 
to be that most problems of energy shortage, 
actual or anticipated, are better solved 
by producing more than by consuming 
less. The result is that governments have 
consistently underestimated the potential 
for energy saving to be achieved by a more 
efficient use of existing energy sources and 
a more vigorous and imaginative approach 
to energy conservation -a demand-side 
strategy. 

12 


The "producerist" bias at work here 
was sharply criticised in the first report of 
the House of Commons Select Committee 
on Energy, published in 1981 (HMSO). 
Commenting on the Government's proposed 
nuclear energy programme, the 
Committee responded to evidence given by 
the Secretary of State for Energy in these 
terms: 

''We agree ... that conservation does not obviate 
the need for a relatively cheap source 
of electricity. In that sense conservation and 
nuclear power are complementary. All the 
same, we were dismayed to find that, seven 
years after the first major oil price increases, 
the Department of Energy has no clear idea 
of whether investing around £1,300 million 
in a single nuclear plant (or a smaller but still 
important amount in a fossil station) is as 
cost effective as spending a similar sum to 
promote energy conservation ... We therefore 
recommend that the Department of 
Energy should assess in future, as it should 
have done in the past, the economics of 
public expenditure to promote energy conservation, 
with the same vigour as that required 
for the economic appraisal of new 
generating plant. " 

The central thrust of this criticism can be 
applied similarly across the whole range of 
public policy making. A future Labour 
Government which is serious in its determination 
not to be captured in this way by 
the powerful vested interests of producers, 
must equip itself with the kind of intellectual 
ballast -in people and ideas -which 
will effectively counteract them. Failure to 
grasp this nettle will permit the continuing 
disproportionate domination of policy 
making by food producers, road-builders, 
the nuclear industry and their equivalents 
-the producer lobbies whose principal 
terms of reference are dictated by their 
shareholder constituencies, not the needs 
of the electorate as a whole. 

These issues touch upon conflicts within 
the labour movement as well as within 
government. Most of the lobbies mentioned 
above are based to some extent on 
alliances which transcend the dichotomy 
of capital and labour; thus the power 
workers form part of the pro-nuclear lobby, 
and many transport workers have 

strong pro-roads interests. A democratic 
socialist approach to policy making does 
not necessarily demand that nuclear power 
stations should remain unbuilt, or that all 
new plans for roads should be rejected; but 
that other options which are consumer-led 
should receive equal attention inside the 
Party and inside government. Policy decisions 
which are producer-led should be 
clearly justifiable in relation to the 
available alternatives . 

An alternative AESt 

Comparative examination of this kind 
reveals that consumer-led options (an active 
programme of energy conservation is 
the best example) often provide more opportunities 
for job creation than other options. 
There was some recognition of this 
link in the development of the Labour Party's 
Alternative Economic Strategy (AES) 
following the general election defeat of 
1979. More generally however, the AES 
was traditionalist in its analysis. Labour's 
Programme 1982 makes fragmentary concessions 
to consumerist perspectives, but 
remains fundamentally "producerist" in 
approach. 

It is instructive to contrast this view of 
the AES with a different kind of criticism 
advanced by Anna Coote. Writing from a 
feminist perspective, Coote complained in 
1981 that the AES was born of "patriarchal 
politics" and was consequently male-
oriented in its assumptions. She went on to 
remark that: 

" If women had power to assert their own experience, 
as men have, we might develop a 
different approach, one with a double axis: 
reproduction and production. This would 
embrace unpaid work as well as paid work, 
and relations within the family and community 
as well as relations between labour 
and capital." (The AES: a New Starting 
Point, New Socialist, November/ December 
1981) 

Anna Coote's analysis is valid; but it is 
also consistent with the consumerist critique 
of "producerism". I would extend her-
argument by proposing that if women, but 

13 


equally men too in their less traditional 
role as consumers and users of goods and 
services, had the power to assert the 
fullness of their experience; and if we really 
did take full account of relations within 
the community -that is of the interdependence 
of producers and consumers, 
then we might indeed "develop a 

I 

different approach", one with a treble axis: 
production, reproduction and consumption. 
The appropriateness of this 
observation is nowhere more apparent 
than in the way that public services have 
customarily been delivered to those in need 
of them. 

5. Consumerism and 
the Public Sector 
One reason why most people outside the committed Left are not more 
enthusiastic about "socialism" is that with the exception of the National 
Health Service their experiences of public ownership and of public administration 
have not convinced them that socialists are capable of 
creating and running institutions which are morally superior, more accountable 
or more efficient than those run by private enterprise. The attitudes 
which big public sector organisations have shown to their 
customers and clients have not generally served to advance the causes 
with which socialists are associated. The nationalised industries in particular 
have too frequently appeared to be remote, forbidding and on-
comprehending. 

" ... the best obtainable 
system of popularadministration and 
control..."l 

Most people, including those who like to 
think of themselves as "non-political", acquire 
views which are essentially political 
as a consequence of their experiences. 
These views may be based on knowledge 
gained through employment -hence the 
fact that many of the sharpest critics of the 

nationalised industries are people who 
work in them. But rather more people are 
influenced by their experience not as producers 
of the gas supply, refuse or rail services, 
but from perceptions acquired in the 
use of them. This point is absolutely fundamental 
and applies across the whole of 
the public sector in the broadest sense. 
Clearly there are important differences in 
organisational structure, corporate 
ethos, financing arrangements, lines of accountability 
and so on -between for ex


14 


ample, area electricity boards, regional 
water authorities and local authority housing 
departments. But what matters to the 
consumer are two central objective 
similarities: the absence of user choice; 
and, most important of all, a common experience 
of bureaucratic insensitivity to 
reasonable expressions of user need. 

The largely passive public response to 
the Conservatives' privatisation pro-
gramme between 1979-85 was a measure of 
a long-term failure to make socially-run institutions 
sufficiently responsive to public 
needs. Reaction to privatisation would 
have been more active and more hostile if 
public sector organisations had succeeded 
in generating and sustaining a conviction 
that the interests of gas users, rail 
travellers, patients, parents, tenants and 
Post Office customers, as well as those of 
taxpayers and ratepayers, and of 
employees, were better served by publicly-
owned and publicly-administered bodies 
than by the private sector. 

The battle is not lost, but we do need to 
be clear about how much ground there is 
to make up. The picture is not one of 
unrelieved gloom. It is clear for example 
from a survey conducted by the Health 
and Social Service Journal (6 June 1985) 
that overall public satisfaction with the 
performance of the National Health Service 
is still remarkably high in spite of the 
financial constraints imposed by the Conservatives. 
(77 per cent of respondents expressed 
the opinion that the NHS in their 
area was either "extremely good", "very 
good" or "fairly good".) Other news is 
much less cheerful however: in particular, 
the overall level of public satisfaction with 
the quality of service provided by local 
authorities is dismally low. This was illustrated 
by a comparative study conducted 
by Social and Community Planning 
Research (SCPR) in 1984. 
Respondents were asked to indicate 
whether they were generally satisfied or 
dissatisfied with the service available from 
eleven major providers. In order of 
satisfaction, the answers were: 

Not 
Satisfied Satisfied 

Local doctor 84 13 

Banks 82 13 

The telephone 

service 80 16 

The police 79 17 

Independent TV and 

radio 76 21 

The postal service 75 22 

The BBC 66 30 

The press 62 34 

The civil service 53 42 

British Rail 52 42 

Local government 49 47 

(Roger Jowell and Sharon Witherspoon (ed), 
British Social Allitudes: the 1985 Report, Social 
and Community Planning Research/Gower, 
1985) 

These results are not out of line with other 
survey evidence. 

There are many objective reasons for 
the low level of public satisfaction with 
publicly-provided services, the most important 
of which in recent years has been 
resource starvation. The roots of the problem 
are altogether more complex 
however; they derive from the nature of 
the relationships involved. 

Consumers have similar economic interests 
in the provision of public goods and 
services as they do with private ones value 
for money (efficiency and effectiveness 
in meeting consumer wants), 
choice to suit different wants and tastes, 
information to enable them to make sensible 
choices, and the power to ensure that 
the providers of the service respond to the 
user's wishes. But there are major differences 
too. Public services, as the National 
Consumer Council noted in The 
Consumer and the State (1979), typically 
have special characteristics which 
distinguish them from private sector services. 
These include: separation of payment 
for the service from its use; monopoly 
of supply; remote decision making; professional 
services not well-understood; 
and responsibilities to members of the 
public who may or may not be users of the 
service. These characteristics in combination 
tend to obscure public understanding 
of the way providers work, and to 

15 


dissipate public sympathy with providers' 
difficulties. 

The workers divided 

Another very different complication for 
the Left is that many public service 
workers are grotesquely badly paid. On 
several occasions in recent years, notably 
during the "winter of discontent" of 
1978-9, this has led to strike action. The 
claims pursued by the unions involved 
have invariably been just. Equally, a great 
many consumers have been inconvenienced, 
in some cases severely so. But who has 
been hurting whom? The twist is that the 
use of the word "consumers" in this context 
disguises the fact that objectively what 
happens in many of these disputes is that 
the working class is in effect actually striking 
against itself. 

The NHS is perhaps the best example of 
a public service which is substantially paid 
for, run by and for the benefit of working 
people; and in which relationships are such 
that the withdrawal of labour by a section 
of the class has only one certain effect, that 
of disadvantaging other workers and their 
families. Moreover this characteristic of 
public sector industrial action is becoming 
more pronounced as a larger and larger 
number of higher-income earners opt for 
private sector provision, thereby putting 
themselves beyond the reach of organised 
labour. On this view the consumer interest 
in the continuing provision of basic services 
during any given public sector industrial 
dispute may be interpreted as being 
equivalent to the immediate interests 
of the working class as a whole. 

This, of course, is only part of the story, 
but one which nevertheless contains an unpalatable 
truth. No socialist can 
reasonably argue that a strategy for class 
victory requires the periodic elevation of 
one sectional interest -a given group of 
workers -above all others; the overwhelming 
losers will always be those who 
have no paid job at all-the unemployed, 
the disabled, the elderly and single 
parents. Even for those in work this is 

surely a recipe for periodic class civil war. 
Nor does the solution lie in no-strike 
agreements as Conservatives would have 
it; these are one-sided in concept and imply 
a wholly unacceptable infringement of the 
liberties of trade unionists. An alternative 
way forward must be based upon an identification 
of the convergences of interest 
between given groups of workers and consumers 
and, where appropriate, on the 
formation of alliances. 

In very general terms the exchange 
should be concerned with job security and 
fair wages on one side of the equation, and 
with value for money and quality of service 
on the other. There is an urgent need 
for a dialogue between trade unions and 
consumer organisations on this basis. 
There is no reason in principle why such 
discussions should be confined to the 
public sector, though this is where there is 
most common ground under a · Conservative 
Government committed to an attack 
both on public sector provision and 
trade union rights. The prospect of negot


iating single issue alliances provides the 
greatest incentive for, and offers the most 
practical route into, more general discussion. 
The Greater London Council's Fares 
Fair campaign in the early 1980s, which 
brought together bus workers and bus 
users in a joint attempt to defend the 
GLC's low fares policy, provided a glimpse 
of the possibilities, as more recently has 
the coming together of teachers and some 
parents' groups during the teachers' pay 
dispute and its aftermath. There is a strong 
case, however, for negotiating more continuous 
relationships, for example between 
Community Health Councils and 
health service unions, and rail users' 
groups and the rail unions, for the broader 
purpose of developing a mutuality of 
understanding and support. 

Of course there will be difficulties; 
equally however, the times have never 
been more propitious for bridge-building 
of this kind. The fundamental objectives 
of such alliances -the need to defend services, 
to enhance producer responsiveness 
to varying public needs, and to 
democratise power structures in the in


16 


terest of both workers and users -ought 
to provide sufficient common ground to 
keep the difficulties in perspective. 

New departures 

From within the labour movement there 
are now some encouraging signs of a willingness 
to meet the demands of public sector 
consumerism at least half-way. This 
opinion shift is associated with the growing 
dissatisfaction on the Left with statist, 
centralised and bureaucratic models of 
public ownership and service administration, 
and the rediscovery of decentralist 
strands in socialist thought. Decentralising 
approaches to service delivery and administration 
are far more conducive to notions 
of user accountability and consumer 
democracy than the familiar centralist 
alternatives. This is explicity recognised, 
for example, in the Labour Co-ordinating 
Committee's pamphlet Go Local to Survive 
(1984) and, with reference to the 
public rented sector, Griffiths and 
Holmes' Fabian tract A New Housing 
Policy for Labour (1985). 

Practical interest in the socialist 
relevance of a user/consumer public service 
perspective owes much to the 
remarkable decentralisation progamme 
pioneered by the Labour-controlled 
Walsall Council between 1980-2. Walsall 
was the first local authority to make a 
systematic attempt to move its network of 
services closer to the consumer by decentralising 
much of its administrative structure 
to neighbourhood offices, an initiative 
which has since been imitated, with 
variations, by a number of Labourcontrolled 
boroughs in London. In each 
case the emphasis has been on extending 
democratic control -by physically 
relocating services "downwards" and by 
removing some of the power of the central 
professional and managerial strata of local 
government in order to give consumers 
greater rights and responsibilities. These 
experiments have explicitly been presented 
as practical ways of involving more people 
in the running of local public services. 

They have therefore directly addressed 
that most neglected part of clause IV (4) of 
the Labour Party's constitution which 
calls for " ... the best obtainable system of 
popular administration and control of 
each industry or service". 

Progress is fragmentary, and it is still 
too early to assess how successful these attempts 
have been, still less to prescribe 
representative structures for the use of 
other authorities. There are real difficulties, 
many of which are acknowledged 
in Go Local to Survive. Changing attitudes 
is a long process. "How", the Labour Coordinating 
Committee's authors ask, "are 
you going to get workers to drop their 
traditional assumption that the client or 
consumer is an irritant that gets in the way 
of work rather than the reason for work 
itself?" 

It is important, too, to acknowledge the 
force of a point -made by Fabian author 
Nicholas Deakin amongst others -that 
though the shade of William Morris is 
never far away from Labour Party debates 
about the merits of decentralised administrative 
structures, such structures 
(and the political perspectives which inform 
their operation) need not necessarily 
be socialist (Anthony Wright, John 
Stewart and Nicholas Deakin, Socialism 
and Decentralisation, Fabian Society, 
1984). They can be accommodated within 
a wide range of political outlooks. From a 
strictly consumer point of view this is in 
itself, of course, unimportant; for 
socialists it is an observation which is 
bound to give rise to hesitation. What has 
been learnt from experience in Walsall and 
elsewhere so far is that the principles which 
underlie the decentralist push are sound, 
and that the political risks are worth taking. 
This view was clearly endorsed by the 
National Executive Committee of the 
Labour Party in a statement submitted to 
the 1985 Party Conference entitled Servingthe Community: Labour's Campaign to 
Save our Public Services. 

The message from the local government 
front is therefore cautiously optimistic; 
there is some theory and a little practice. In 
the nationalised industry sector, by con


17 


trast, there is comparatively little of either. 
There is much evidence, however, of 
mounting socialist dissatisfaction with 
traditional forms of nationalised public 
ownership, and, more hopefully, of a willingness 
to think these criticisms through in 
a way which is consonant with the needs of 
consumers as well as of employees. A 
number of motions on the future of public 
ownership submitted for debate at the 
1985 Labour Party conference talked 
about the requirement to "ensure that all 
major industries and services privatised by 
the Tories are returned to a form of public 
ownership that is both accountable and 
responsive to the needs of its employees 
and consumers within a system of social 
audit". 

More promising still is the fact that 
some of these reforming initiatives are 
coming from within the trade union movement. 
Alan Tuffin, General Secretary of 
the Union of Communication Workers, 
writing about public ownership in Tribune 
(27 September 1985), argued that "consumers 
should have direct means of access 
and redress. Local watchdogs should be 
established to represent community interests 
and take up individual grievances. 

They should have direct channels into the 
decision-making structures of public enterprises 
and guaranteed budgets ensuring 
that they are independent." (Emphasis added). 


This all sounds wonderful, but to date, 
very little detailed work of the kind 
necessary to enable a future Labour 
government to turn such splendid notions 
into accomplished reality has been done. 
Democratising and decentralising nationalised 
industry structures is a much 

more formidable task than most Party 
members like to admit. The vested interests 
of management, the unions and of 
the existing consumer consultative committees 
all come into play. The conservative 
instinct is immensely strong in each 
of these quarters. 

One event however -the privatisation 
of the British Gas Corporation -will 
blow most of the Left's post-war assumptions 
about public ownership sky high. 
From the moment the Gas Act 1986 
receives the royal assent, Morrisonian nationalisation 
as a living political and 
organisational doctrine will be finished. 
"Back to 1945" is no longer a realistic option 
for the Left. In order to combat the 
radical Right, socialists will need to be able 
to present an entirely new model of a 
regulated, socially-owned public utility 
which is less monolithic and more responsive 
-to workers and consumers aJike than 
anything British socialists have yet 
constructed. 

We can adapt the experience of the US 
regulatory commissions in states like New 
York and Wisconsin; and, nearer to home, 
we must learn from the experiences of our 
own utility workers and consumers. Here 
resoundingly is the case for a joint trade 
union/consumerist approach. But time is 
short. It will not be sufficient, or sufficiently 
convincing, for the Labour Party 
to enter the next general election on a platform 
which counters privatisation solely 
by an appeal to the record of traditional 
nationalisation. The electors will want, 
and will deserve, a new deal on public 
ownership. We have approximately one 
year to work out the details of that new 
deal. 

18 


6. Poverty as a 
Consumer Issue 
In Poor Britain, the book of the television series Breadline Britain first 

broadcast on London Weekend Television in the summer of 1983, 

Joanna Mack and Stewart Lansley establish that some 8.5 million people 

live in poverty. "Poverty" is defined not in terms of state-determined 

minima but as "an enforced lack of socially perceived necessities" 
(Joanna Mack and Stewart Lansley, Poor Britain, George Alien and Unwin, 1985). 

This is a definition which is uniquely sensitive 
to popular consumer feeling . It takes 
the values of our "consumer" society at 
face value by arguing, in effect, that people 
are poor if they cannot afford to buy 
the goods and services which are deemed 
by their peers to be necessary to enable 
them to live, rather than merely to exist. 

Poor Britain is thus not only a depressingly 
familiar statement about the extent 
of contemporary social deprivation; it is 
also an unusually detailed enquiry into 
current consumer expectations. With the 
help of advanced survey techniques, Mack 
and Lansley are able to translate popular 
perceptions of need into 26 standard-ofliving' 
'necessities'', ranging from heating, 
an indoor toilet and a damp-free home at 
one end of the ranking, to holidays, leisure 
equipment for children and a garden at the 
other. They ascertain both what people 
feel to be necessities, and also how many 
people have to do without them. It is the 
juxtaposition of these two pieces of information 
which makes Poor Britain such an 
effective indictment. And so we learn that 
two-thirds of those who took part in the 
survey (all social groups) classed 
refrigerators and washing machines, a 
warm water proof coat and three meals a 
day for children as necessities; but that 
nearly 3.5 million people lack "essential" 
consumer durables, around six million go 
without some ''essential'' item of clothing, 
and that nearly half a million children do 
not eat three meals a day . 

The 8.5 million people identified by 
Mack and Lansley as living in poverty suffer 
from the chronic negation of choice the 
denial of access to certain goods and 
services -which flows from lack of personal 
disposable income. For them the exercise 
of choice as it is most familiarly 
understood (whether to shop at Woolworth's 
or Marks and Spencer's) is marginal; 
it is the enforced ("unchosen ")exercise of 
choice in another dimension (whether to 
buy new shoes for the children or pay the 
gas bill) which defines the impoverished 
quality of life lived by those consumers. 
That is one of the reasons why Diana 
Whitworth , chair of the Consumer Congress 
in 1985, felt it necessary to declare to 
Congress delegates her belief that "the 
divide between the rich and the poor is an 
issue which the consumer movement must 
confront" . 

Support for this view should not be 
taken as implying that socialist and consumerist 
critiques of poverty are indistinguishable, 
however. The socialist 
position rests on a broad political 
philosophical base, and is concerned with 
concepts such as social equity. The consumerist 
position , though not necessarily 
incompatible with this, rests on a narrower 
base and its solutions flow specifically 
from consumer perspectives. This point 
can be illustrated by reference to the issue 
of consumer debt and the concept of consumer 
detriment. 

19 


Consumer debt 

There is a serious and growing problem of 
consumer debt. Each year over 2 million 
"money plaints" are started in the county 
courts. This figure massively understates 
the problem in that it excludes most fuel 
debts, for which the sanction is disconnection, 
and most rent arrears linked to evictions. 


At the end of 1980, five per cent of accounts 
due to members of the Finance 
Houses Association were in arrears. By the 
end of the 1984, the proportion had risen 
to seven per cent -a 40 per cent increase. 
Over one million council tenants are now 
behind with the rent. In addition, around 
100,000 householders are more than three 
months behind with mortgage payments to 
building societies, and around 13,000 
householders are six months behind with 
mortgage payments to local councils. 

The rising trend of consumer debt is 
placing an enormous strain upon the advice 
services, to whom a growing number 
of people turn for help. The Citizens' Advice 
Bureaux (CABx) alone are now dealing 
with a quarter of a million multiple 
debt problems each year. According to the 
National Consumer Council the "single 
most important cause of consumer debt 
today is a sudden unexpected drop in income 
-such as that caused by redundancy, 
short-time working, illness, a death in 
the family or marriage break-up" . The 
NCC acknowledges that poverty, either as 
cause or consequence or both, is "a major 
factor" in the incidence of consumer debt 
(Consumers and Debt, National Consumer 
Council, 1983). 

A number of responses to this situation 
have been proposed, including the enactment 
of new laws on personal bankruptcy 
and the raising of benefit levels, both of 
which obviously require action by central 
government. Within the credit industry 
there is now some recognition of the need 
both for more responsible lending practices 
and for more efficient and sensitive 
collection methods. The main consumerist 
response however has been the growing de


mand for the greater provision of debtcounselling 
and money advice centres. 
Responsibility here is shared by local 
authorities and various voluntary agencies, 
though the question of central 
government funding is also critical. 

No form of response is likely to be sufficient 
on its own. A successful assault upon 
the problem of consumer debt, and upon 
the wider scourge of poverty of which it is 
a part, will need to draw both on ''top 
down", centrally-determined political 
responses and on "bottom up" consumerist, 
advice-oriented solutions. 

Consumer detriment 

A second specifically consumer dimension 
of poverty is supplied by the concept of 
"consumer detriment". The basic notion 
is that poor people get less or worse-quality 
goods and services for each pound spent 
than richer people. 

Firstly, people with low incomes cannot 
ordinarily buy in large quantities because 
they cannot pay out large sums of 
money at any one time and in any case probably 
lack the storage facilities. They 
therefore obtain worse value for money 
than bulk buyers. 

Secondly, people with low incomes are 
less likely to have cars and are therefore 
much more likely to be dependent upon 
small, relatively expensive local shops. 
Buying in small quantities in this way can 
raise the unit cost of food by as much as 
one-third. 

Thirdly, since poorer people are often 
still paid weekly they tend to budget accordingly 
and plan their spending over short 
time spans. This discourages the kind of 
capital spending which saves money in the 
long run, and can get families into difficulties 
if large sums are suddenly required, 
for example to pay a quarterly bill. 

There are other forms of consumer 

detriment in both the private sector (dif


ferential costs of credit) and the public sec


tor (for example in the take-up of educa


tional and health service provision). Con


sumer detriment in the service sector 

20 



relates not to value for money in the accepted 
sense, but to availability, take-up 
and quality of service supplied. So low-
income consumers may (and often do) get 
a worse quality service from health and 
legal professionals because they are less 
"rewarding" clients. 

The steep rise in the numbers of the 
unemployed and the fall in the real value 
of many state benefits almost certainly exacerbates 
some features of the problem. 
There are people living on social security, 
for example, who are now virtually driven 
to apply to inner-city loan sharks for 
money to pay their household bills because 
they are unable to obtain credit from 
reputable lenders. This has led in extreme 
cases to a number of well-publicised horror 
stories in which the sharks have even 
taken their customers' social security 
benefit books as a means of guaranteeing 
arbitrary and extortionate rates of interest. 
This is of course illegal, but gaining sufficient 
evidence to prosecute is very difficult, 
partly because of the terror of the 
victims, some of whom live in fear of 
violent reprisals. 

Consumer detriment, like consumer 
debt, is of course only part of the much 
wider problem of social inequality. This 
does not mean, however, that nothing can 
be done in present political circumstances. 
Two of the practical solutions which have 
been advocated by the National Consumer 
Council are bulk-buy groups and credit 
unions. Both are related to the principle of 
the buyer's market -consumers banding 
together and pooling resources for mutual 
benefit thereby increasing their collective 
market power vis a vis suppliers. Bulk supplies 
come at lower prices; bulk-buy clubs 
can therefore transform a small expensive 
local shop into a cheaper one by getting the 
shopkeeper to act in effect as its wholesale 
dealer. Similarly, in the related area of 
personal financial services, credit unions 
enable people on low incomes to pool their 
small savings and borrow from the pool at 
reasonable rates of interest. This provides 
a co-operative alternative to more expensive 
forms of credit like in-store credit 
cards, and has the additional benefit that 

poor consumers can shop around for good 
value buys instead of becoming locked into 
relationships with single retailers. 

The basic principle can, ofcourse, be extended 
into other areas of consumption most 
successfully in recent years in the cooperative 
housing sector. We should be 
aware, however, of the lessons of previous 
experience, and of the limitations of this 
kind of self-help strategy. 

The most important lesson is that self-
help consumer co-operatives cannot be 
developed on a "top down" basis. The 
National Consumer Council allocated a 
significant proportion of its resources to 
the initiation and encouragement of both 
bulk-buy groups and credit unions in the 
late 1970s with no great lasting success. 
But the NCC has no grass-roots representation 
or organisation. Like other national 
bodies it can assist local initiatives by passing 
on information and expertise; the impetus 
for development, however, has to 
come from below and must be community-
driven. 

The problems are more complex with 
detriment in the consumption of services 
-particularly medical and legal services. 
Tackling inequalities in these areas will demand 
more than local enthusiasm and cooperative 
organisation; success will probably 
require enabling measures of 
positive discrimination of a kind that only 
central government can undertake. The 
health sector is a case in point. Because 
poor people suffer both from more 
sickness than other groups and from inferior 
access to health care provision, their 
detriment cannot be overcome by equalising 
health services for different groups irrespective 
of need. Rather, there must be a 
radical reallocation of resources away 
from the better-off towards poor groups 
and neighbourhoods. Community Health 
Councils could play a central role in this 
process-identifying needs and helping to 
redirect resources. 

A similar point can be made about detriment 
in access to legal services -unmet 
needs, the siting of solicitors' offices, the 
number and location of firms doing legal 
aid and the overall quality of service of-

ll 


fered . The Law Centres Federation has 
made a corresponding case for the extension 
of law centre services supported by 
public funds. The Lord Chancellor's 
Department refuses to accept responsibility; 
meanwhile, under the impact of enforced 
cuts in local authority spending, existing 
centres are actually closing. 

In both of these areas a new kind of 
partnership between local enterprise and 
public funding is needed to redress imbalances 
in consumption. Inadequate funding 
is not the only problem; nor will increased 
budgets of themselves miraculously 
lead to the elimination of all relevant 
detriment -that is the satisfying of all 
currently unmet needs to a standard which 
would be recognised as adequate in Hampstead 
and Edgbaston. Equally however, it 
is difficult to envisage any set of arrangements 
which would ensure that all 
the people have sufficient access to good 
quality doctors, dentists, solicitors and so 

on without significantly increasing total 
expenditure. Market-based solutions based 
on competition and insurance principles 
are only likely to exacerbate consumer 
detriment in ways which are all too 
familiar. The traditional socialist case for 
the elimination of poverty and the radical 
and less traditional consumerist case for 
the erosion of consumer detriment con


verge at this point. 

Poverty is, therefore, a consumer issue. 
To reach that conclusion is not to render 
its existence in the midst of affluence more 
or less acceptable, nor to simplify the task 
of tackling it. But it does help to make the 
predicament of the "have-nots" more 
comprehensible to the "haves"; and it 
does strengthen the arm of a political party 
which is seriously in the business of taking 
on the problem. The consumer perspective 
ought for that reason alone to inform the 
content of any socialist programme for 
defeating poverty. 

7. Thinking Positivelyabout Markets 
There is a fallacy, deeply-rooted within the British Left, that social 
ownership somehow replaces the operation of markets. Of course it does 
not: some form of market always remains, even if only of the black variety. 
We therefore need to remind ourselves that it is possible -I do not 
argue desirable -to conceive theoretically of highly competitive, 
perfectly working markets in which all the units are socially owned. It is 
worth making the point simply to emphasise how regrettable it is that 
British socialists have customarily devoted so little attention to thinking 
about the development of a socialist competition policy. 

22 



Too much discussion of economic policy 
in Labour Party circles continues to rest on 
the assumption that the achievement of 
socialism is synonymous with the abolition 
of all markets and the supplanting of all 
competitive mechanisms. Market principles 
are often presented as necessarily 
and irredeemably capitalist. No clear 
distinction is drawn between questions of 
ownership and questions of market 
behaviour. Monopolies are acceptable, if 
not desirable, as long as they are not in 
private hands. There is little or no interest 
in, or understanding of, the basic concepts 
of market regulation. 

There have recently been some encouraging 
signs of a willingness to examine 
these issues. Geoff Hodgson's The 
Democratic Economy: a new look at Planning, 
Markets and Power (Penguin, 1984), 
for example, rejects the opposition of nationalisation 
versus markets and private 
enterprise, and poses the alternative of 
democratic autonomy through a 
framework of economic planning, collective/
social ownership and the (subordinated) 
operation of markets. The point 
to emphasise here is that the movement of 
discussion amongst socialists on questions 
concerning the proper role of markets increases 
the prospects of collaborative activity 
with consumer organisations which 
have learned something about markets the 
way they operate, who benefits and 
who gets hurt -over the years. This experience 
ought not to be irrelevant to a 
future Labour government. 

This is not to argue that consumerism 
has all the right answers, or that socialists 
should accept consumerist prescriptions 
uncritically. Some consumerist dogma indeed 
("all competition is good for you") is 
as mindless as some socialist dogma ("all 
competition is wasteful"). There are two 
fundamental reasons why the response 
should be a discriminating one, neither of 
which has any direct bearing upon the 
question of public ownership, about which 
consumer organisations are formally 
neutral. 

Consumer sovereignty 

First, what many consumerists say about 
the role of markets in a mixed economy is 
based on a view of the world which is ideal 
rather than real or even realisable. The 
basic consumerist model is one in which 
the individual consumer enjoys an equality 
of power in a perfectibly competitive 
market-place. This inadequately describes 
existing or probable reality; it makes insufficient 
allowance for the fact that many 
markets (not all) do not operate in the way 
they are supposed to in neo-classical 
theory. 

Secondly, turning from market structure 
to market behaviour, consumerists 
need to remind themselves of JK 
Galbraith's famous strictures in The New 
Industrial State (Penguin, 1969) on the imbalance 
of power in many producer/ 
consumer relations in the market-place; 
rather than responding to pre-existing demand, 
he argued, large firms play a major 
part in actually creating and manipulating 
consumer wants. The panoply of 
marketing tools available to companies for 
this purpose has continued to grow since 
Galbraith's analysis was first published, a 
process most evident in the direct-mail 
revolution . The individual buying decisions 
of consumers do count of course product 
lines disappear and companies 
close in consequence. But the power of 
corporate public relations and advertising 
is such that in spite of a significant improvement 
in the general quality of information 
now available to consumers, 
people still buy inferior products, unsafe 
products and over-priced products, and 
some of them have difficulty in paying for 
them . Consumer choice perhaps; but a 
poor sort of "sovereignty". 

A further though secondary objection 
to the simple consumerist model with major 
political implications is its short-term 
bias. Consumer organisations are opposed 
in principle to import restrictions on the 
grounds that such policies diminish consumer 
choice, which of course they do. 
But the short and long-term interests of 
particular groups of consumers may stand 

23 



to to 
in opposition to each other if the consequence 
of short-term rational choices is 
(longer-term) to put British factories out 
of business, diminish or eliminate home-
based competition and increase unemployment. 


Each of these objections to forms of 
consumerist political economy in which 
the market principle predominates raises 
basic questions about the management of 
supply and demand, the role of economic 
planning and the implications for individual 
choice. And if, as I have suggested, 
the neo-liberal approach is deficient 
or unacceptable, then it must be 
acknowledged that there are difficulties 
which planned economies will find it difficult 
to resolve too. One fundamental 
problem highlighted by a number of 
writers is that all economic systems, in 
whatever way they are organised, encounter 
a form of anarchy which emanates 
from the difficulty and uncertainty surrounding 
the attempt to match demand 
and supply at some point in the future . 
Production and investment decisions have 

be taken now, but with incomplete 
knowledge of the level and kind of demand 
which will materialise later. 

The important point for consumers is 
that although this question of allowing for 
unpredictable future demand presents 
capitalism with a problem, a completely 
planned economy cannot ·eliminate it 
either. What socialism can offer, however, 
in Phi! Wright's words, is "more organised 
alternatives for people affected by this 
inevitable kind of anarchy" (New 
Statesman, 26 October 1984). Wright goes 
on to sketch in some observations on the 
need for a "non-capitalist market", two 
of whose features would be the absence of 
concentrations of private property and a 
more equal distribution of income. The 
continuing importance of individual 
choice is clearly acknowledged. 

Towards a socialist 
competition policy 

Within this kind of framework the objec


tives of a socialist competitiOn policy 
should be to identify the sectors of the 
economy where the operation of markets 
is appropriate in the consumer interest and 
where it is not; to enhance the operation of 
particular markets by breaking up 
monopolies which work against the consumer 
interest; and, as in the case of the 
major public utilities like electricity and 
water where monopoly conditions are 
both appropriate and perhaps even 
desirable, to regulate the activities of suppliers 
to ensure that monopoly privileges 
are not abused and consumers exploited. 

The practical application of these principles 
will involve complex choices and 
trade-offs. This is apparent, for example, 
from recent experience in the transport 
sector. The effects of the deregulation of 
the market for long-distance coach services 
in the early 1980s illustrate some of 
the difficulties and conflicts. Many 
customers have undoubtedly benefited as 
regards both price and quality. But there 
have been substantial disbenefits to others, 
including rail passengers and employees in 
both industries. The deregulated social 
balance sheet must also take into account 
increased traffic congestion and pollution 
problems in city centres, particularly London. 
This is a market which demands the 
kind of regulatory approach which 
recognises the unacceptable "external" 
consequences of unrestricted competition, 
and perhaps, therefore, less competition. 

On the other hand the decision of the 
Civil Aviation Authority to allow British 
Midland Airways (BMA) to compete with 
British Airways (BA) on certain routes between 
Heathrow and Scotland has brought 
enormous benefits to air travellers without 
any observable consequential disbenefits 
to others. Since BMA entered the scene the 
service offered by BA to its customers has 
improved dramatically, as have the services 
provided by British Rail on corresponding 
routes . 

A positive role for the operation of 
markets can also be clearly observed in the 
upheavals currently engulfing the professions. 
The opticians and the solicitors have 
both recently had traditional monopolies 

24 


taken away from them, respectively on the . 
supply of spectacles and conveyancing. 
Significantly, the battle to introduce 
market disciplines into the conveyancing 
business has been led by a Labour MP, 
Austin Mitchell, supported by the Consumers' 
Association . In both areas the 
outcome is already proving to be beneficial 
to consumers generally. The overall 
benefits in relation to price and choice are 
already there for all to see. The necessary 
guarantees on quality and redress are in 
place. All providers and suppliers must 
submit themselves to the scope of stringent 
regulation . In short, a regulated market 
solution is appropriate. 

But there are many other sectors where 
it is not. Electricity generation, shipbuilding, 
coal production, water supply, 
rail services, steelmaking and blood banking 
are just a few . In each case any arrangements 
in which market as opposed to 
planning principles, were to be dominant, 
would be wasteful or inefficient, or both. 
The reasons -insufficient overall demand, 
the need to take advantage of 
economies of density and scale, and so on 
-will differ from case to case. 

The key political point in the mid 1980s 
however, is that socialists can no longer 
take it for granted that the old arguments 
will retain popular acceptance. On the 
contrary, there is very little prospect of 
halting the Government's relentless pro-
gramme of privatisation -the replacement 
of public by private monopolies 
under the disingenuous pretext of bringing 
about "greater competition" and "more 
consumer choice" -unless we can win 
particular arguments in detail on the 
Tories' own ground. This means being 
able to convince voters that many political 
arguments rooted in market principles as 
with the privatisation of the British Gas 
Corporation -are to a considerable 
degree a fraud upon consumers. 

After six years of Mrs Thatcher there is 
now enough experience of the indefensible 
application of market principles to enable 
us to do so. It can be shown, for example, 
that the consequences of putting hospital 
cleaning services out to competitive tender 

have been both to drive down standards of 
service to consumers and to drive down 
workers' wages. Consumer organisations, 
for their part, have been too reluctant to 
face up to these aspects of the unacceptable 
face of competition. Where market 
solutions have not worked, or have worked 
damagingly, they should be prepared to 
say so. 

Work to be done 

It is relatively easy to agree that the 
theoretical basis for a socialist competition 
policy should be a model of structural 
economic pluralism in which markets take 
their proper place but are subordinated to 
a dominant framework of socialist planning. 
It is much more difficult to work 
through the detailed policy consequences. 
In particular, some of the questions that 
need to be addressed (which markets, and 
by what criteria) imply a more vigorous 
commitment to the principle of policing 
the market-place than Labour Governments 
have sometimes demonstrated. 

One answer is to beef up the Monopolies 
and Mergers Commission (MMC), or 
some comparable new body, and to increase 
its powers. Early in 1986 it began to 
appear that Labour's Parliamentary Trade 
and Industry team were indeed thinking in 
these terms in relation to mergers policy. 
The proposal was advanced that in certain 
cases a suggested merger would be 
disallowed unless the bidder could successfully 
persuade the MMC that the deal 
was positively in the public interest (Financial 
Times, 22 January 1986). 

This kind of reform is the very least that 
will be required if the trend towards 
greater concentration -and less competition 
-in key sectors is to be reversed. A 
considerable amount of detailed work 
needs to be done. This should include a 
complete review of the Fair Trading Act 
1973, some of the provisions of which, for 
example in the newspaper industry, have 
been more often honoured in the breach 
than in the observance; and a systematic 
analysis of the work of the Price Commis


25 



sion under the last Labour Government. It 
is important, too, for Labour to articulate 
a clear policy for the regulation of 
monopolies and semi-monopolies. The 
Conservatives are in the process of 
developing a plethora of sectoral 
regulatory bodies with differing powers 
and duties. The case presented by the National 
Consumer Council for the creation 

of a rationalised Public Utilities Commission 
merits careful examination. 

Further work in this area is a priority. A 
socialist government which is unclear, or 
wholly negative, as to what role markets 
should play within a planned and 
regulated framework , is all too likely to be 
deflected from its course by the very forces 
it sets out to subordinate . 


8. Some Markers for 
a Labour Government 
The perspectives on which this pamphlet draws have already acquired a 
considerable resonance in public discussion, though within the Labour 
Party their acceptance will be dependent upon a willingness to 
acknowledge the socialist validity of different ways of seeing things. 
However, in addition to the terms of socialist discussion in general 
terms, it is important to begin to think about much more specificreforms. 

In one important sector, the control and machinery of government, national and 
delivery of local authority services, it is local, of quasi-government and of publicclear that progress on some fronts need not enterprise. 
await the return of a Labour Government. 
But the capacity of Labour councils to 
deliver real improvements in service stan-Machinery of governmentdards is heavily circumscribed -progressively 
so -by central government The voice of consumers within govern-
policy. The same applies to nationalised ment must be strengthened. In housing, 
industries like British Rail. Inescapably, education, health, energy, trade and other 
the comprehensive fulfillment of many areas of policy, consumers are a majority, 
basic consumerist aspirations depends not not a minority constituency. This is a 
only on the election of a Labour Govern-truism, but one which finds little reflection 
ment but also, critically, on the determina-in the organisation and weighting of the 
tion of Labour ministers to respond to work of corresponding governmentfresh thinking. New legislation will be re-departments. There is no convincingquired. So too will changes in the reason why, at official level, the policy 

26 


consequences of a demand or consumer-
led approach to given problems should apparently 
receive so much less attention 
than producer or supply-led approaches. 

This point, illustrated earlier in the 
discussion of "producerism" in government, 
is fundamental. An incoming 
Labour government must diagnose the 
nature and extent of the intellectual and institutional 
biases which prevail in 
Whitehall, and act to correct them. It is 
not appropriate, in terms of the internal 
allocation of staff and other resources, for 
government departments to relegate 
energy conservation, preventative 
medicine, advice services, quality 
assurance and other consumer priorities to 
the margins of their activities. 

These matters need to be tackled both 
within and between government departments. 
Many detailed questions of intellectual 
approach, policy priority and resource 
allocation will clearly be a matter for individual 
ministers to determine on the 
basis of manifesto commitments. But 
there is an imponant inter-departmental 
dimension too. The preoccupations of 
consumerism on the broad definition extend 
far beyond the confines of the Consumer 
Affairs Division of the Department 
of Trade and Industry (DTI). Some important 
consumer issues -like those of insolvency 
and insurance law reform -fall 
within the remit of other divisions within 
the DTI. But other departments are also 
involved. Home improvements are handled 
by the Department of the Environment 
(DoE). Hospital complaints are the province 
of the Department of Health and 
Social Security (DHSS). Home energy 
audits are the responsibility of the Energy 
Efficiency Office, a unit of the Department 
of Energy (DoEn). Banking matters 
involve the DTI, the Treasury and the 
Bank of England. The problem of fuel 
poverty, including disconnections, brings 
in the DoE, the DHSS, the DoEn, the 
energy utilities and, as always at the bottom 
line, the Treasury too. 

Some inter-departmental business does 
take place, though it is difficult for out


siders to follow its paths, or even to obtain 
confirmation of its existence. Its purposes 
appear to be responsive rather than initiative. 
Such arrangements are unsatisfactory 
for two reasons. First, the fragmentation 
of work on consumer issues within 
and between departments inhibits the 
development of coherent government 
strategy on thematic issues like regulation 
and de-regulation, competition and codes 
of practice. This would matter less if Civil 
servants were free to share (and in the 
habit of sharing) information and expertise 
amongst themselves across departmental 
boundaries. Unfortunately this is not 
the case. Indeed, and this leads to the second 
point, the reverse is often true. 
Government departments are accustomed 
to behaving competitively. In particular 
there is competition for chunks of spending 
resources and for slots in the 
legislative timetable, though these are only 
the formal manifestations of a culturally 
ingrained phenomenon. This is not helpful 
to the development across Whitehall 
boundaries of integrated responses to 
cross-departmental policy problems, or to 
the co-operative planning of joint work 
programmes on "big" topics like the 
regulation of public utilities. 

The subject of civil service reform extends 
much wider than the scope of this 
pamphlet, but one of its other features is 
relevant. To recap an earlier point, part of 
the reason why powerful people in government 
departments have thought and acted 
as they have is that they have been very 
close to the various producer lobbies-the 
National Farmers' Union, the British 
Road Federation and the electricity supply 
industry amongst others. There is nothing 
necessarily sinister about symbiotic relationships 
of this kind; however, the fact 
that they develop covertly is bound to 
create conditions in which conspiracy 
theory can flourish . From a consumer 
point of view it is bad enough that governments 
find it easier to talk to the people 
who build and finance homes than to those 
who live in and pay for them; but what is 
worse is not being able to find out what 
was said by whom, to whom and when . 

27 


Producer power in government is buttressed 
by official secrecy. Consumer 
organisations, handicapped as they are by 
the paucity of the resources available to 
them, will never succeed in redressing this 
imbalance until the processes of government 
consultation, policy formulation and 
decision taking are made more 
transparent. It is for this reason that 
Freedom of Information lies at the heart 
of the consumerist agenda. 

"Open government" is not a sufficient 
response to this imbalance however; a major 
administrative reorganisation in 
Whitehall is also necessary. The most 
radical option would be to create a new 
Department of Consumer Affairs with a 
wide-ranging brief extending beyond both 
the current remit of the Parliamentary 
Under-Secretary of State for Corporate 
and Consumer Affairs and the former 
remit of the old Department of Prices and 
Consumer Protection. Led by a Secretary 
of State of senior cabinet rank, the new 
Department would be free to examine any 
issue -from trade policy to delinquent 
directors to home improvements -exhibiting 
a strong consumer interest. This 
proposal implies some degree of separation 
as between executive and non-
executive functions, and would therefore 
certainly not be wholly problem-free. Civil 
servants working on inter-departmental 
projects can, additionally, be faced with 
genuine conflicts of loyalty of a kind with 
which Whitehall is not well-equipped to 
deal. It may be necessary to devise new 
standing procedures to cope with potential 
difficulties of this sort. 

In spite of the obstacles, there is much to 
be gained from an approach along these 
lines. It would offer the clearest possible 
signal to the world inside and outside central 
government of a fresh determination 
not to allow policy development to be 
steam-rollered by powerful producer interests, 
and would permit such activities to 
be carried out in a genuinely noncompetitive, 
inter-disciplinary working environment. 


One variant of this option -there are 
doubtless others -would be to replicate 

the existing Consumer Affairs Division of 
the DTI in a number of other key departments 
including the DHSS, the DoE, the 
DoEn, the Home Office and the Department 
of Education and Science, together, 
possibly, with the Scottish, Welsh and 
Northern Ireland Offices. The biggest 
threat to the success of this arrangement 
would be the lack of sufficient internal 

divisional autonomy. Detailed precautions 
would need to be taken, following consultation 
with the civil service unions, to 
prevent intra-departmental sabotage. 

Quasi-government and 
the consumer 

One supplementary option -it would not 
do on its own -would be to increase the 
resources available to the National Consumer 
Council (NCC), the · quasi-
governmental body whose formal terms of 
reference most closely coincide with the 
broad definition of consumerism. The 
NCC's total staff complement of approximately 
50 (including Glasgow and 
Cardiff-based personnel) is diminutive 
considering the breadth of its remit. There 
is a strong case for increasing both its 
obligations and its resources. Expansion 
should be conditional upon a fundamental 
structural reform however; the NCC needs 
to be made more accountable, though this 
should be done in a way which protects the 
independence of its policy-making procedures. 


The legitimacy claimed by consumer 
organisations currently rests far more 
heavily upon the quality of their research 
than upon the democratic purity of their 
formal representative structures. This is a 
sustainable position. Nevertheless, there is 
considerable scope for reforming these 
structures, particularly in the statutory 
sector where appointments are traditionally 
made by ministers on the time-honoured 
"great and good" principle. 

This kind of patronage is no longer acceptable. 
In principle, consumer representatives 
should be directly elected. 
Undeniably however, the democratic 

28 




reform of representation on national consumer 
bodies poses difficult problems. 
One possibility is to establish an electoral 
college comprising members of organisations 
affiliated to the Consumer Congress. 
Members of the college would be balloted 
every three years (say) in elections for part-
time positions on the National Consumer 
Council and the Nationalised Industries' 
Consumer Councils. Perhaps half the 
membership of these bodies would continue 
to be appointed by ministers, but on 
the basis of open competition through 
advertisement. No doubt other formulae 
could be devised. There is room for debate 
as to the detailed mechanics of change, 
though almost any reform along these lines 
would have the effect of raising the public 
visability of the organisations concerned. 

There is an interesting case for yet further 
enhancing the accountability of a 
reconstituted NCC by developing its links 
with Parliament. Just as the Council is 
now expected to take on pieces of work 
("remits") for the Government, reporting 
to its sponsoring department the DTI, so 
comparable exercises could be undertaken 
on behalf of Parliamentary select committees. 
Indeed, in the circumstances of the 
creation of a new Department of Consumer 
Affairs and of a corresponding 
select committee "shadow" -the Commons 
Select Committee on Consumer Affairs 
-the NCC would be ideally placed 
to act as the new Committee's research 
arm. Its resources would then be at the 
equal disposal of the executive and the 
legislature. An arrangement of this kind 
would simultaneously strengthen the 
NCC's voice in the policy-making arena 
and finally eradicate any grounds for continuing 
criticism as to the legitimacy of its 
operations. 

This principle of extending the 
democratic basis of consumer representation 
should also be applied at local level in 
the public services. In the housing, education 
and health sectors for example, elections 
to governing bodies could take place 
on the same day as local authority ballots. 
Direct election would bring the twin 
benefits of greater accountability in the 

running of our local communities, and of 
reducing the burden of responsibility particularly 
in relation to complaints-
handling -which now falls upon hard-
pressed local councillors. 

Such suggestions are not always popular 
with councillors themselves; however, the 
riposte that they already constitute the embodiment 
of consumer virtue by the fact of 
their elected status, is unsatisfactory. 
Councillors nominated to sit on existing 
area gas and electricity consultative committees, 
for example, have consistently 
been their least active members. Most are 
over-committed. There is a further objection 
in principle to such arrangements 
where councillors are nominated by 
authorities which are themselves active, 
perhaps on a competitive basis, as suppliers 
of services. No individual can 
simultaneously represent both the suppliers 
and the users of a given public service; 
there is a conflict of interest in formal 
terms which gives rise to a blurring of lines 
of accountability. 

Legislation and review 

We need new laws as well as remodelled institutions 
and reformed structures of consumer 
representation. The possible scope 
of legislative action is extensive, even on 
the narrow definition of consumerism. 

In some areas of policy the case for new 
legislation has already been made out. The 
Conservative Government has so far omitted 
to find the necessary Parliamentary 
time to implement its own White Paper 
recommendations on consumer safety 
(The Safety of Goods, HMSO., Cmnd 
9302, 1984), a failure which should be 
reversed by an incoming Labour Government. 
The related issue of product liability 
is also of urgent importance. The indications 
are that the Conservatives will 
legislate in 1986-87 along lines which, 
though broadly consistent with the requirements 
of an EEC Directive on the 
subject, will nevertheless leave open a major 
loop-hole. Manufacturers are to be 
allowed to claim exemption from the 

29 


obligations of full liability for damage or 
injury caused by their products on the 
basis of the so-called "state of the art" or 
"development risks" defence. Consumer 
organisations fear that this defence, had it 
been available to the manufacturers of 
Thalidomide, would have absolved the 
company from an obligation to pay adequate 
compensation to victims of the drug. 
An incoming Labour Government must 
legislate for full product liability. 

There are other areas in which the case 
for legal reform has already been sufficiently 
established, amongst them the law 
on misleading prices (including the 
phenomenon of never ending "sales"}, 
and on "material disclosure" by policyholders 
to insurance companies. This last 
legal get-out has enabled insurers to exploit 
a technicality and avoid paying out 
on a variety of types of claims on the 
grounds that "full disclosure of the relevant 
facts" had not been made by the 
policy-holder. It has given rise to serious 
injustice. 

Equally however, there are other problems 
-some familiar, some merely anticipated 
-to which the answers are not 
yet clear. This is the case for the establishment 
of "Molony Mark II". By the time 
the next government is elected, the report 
of the Molony Committee on Consumer 
Protection will be getting on for thirty 
years old. The social, economic and 
technological context has changed considerably 
in the meantime. One of the first 
tasks of the new Secretary of State for 
Consumer Affairs should therefore be to 
set up a new Molony-type review. Its terms 
of reference should be to identify gaps, 
failures and weaknesses in current consumer 
protection law and enforcement, 
with a view to possible legislation some 
time in the third or fourth session of 
Parliament. 

This will be a major undertaking; there 
is now much more legislation on the 
statute book to assess than there was at the 
time of Molony. Some of the issues that 
must be considered are familiar, others less 
so. The growing international trade in 
counterfeit goods and the worthlessness of 

a great many consumer "guarantees" in 
the notorious field of home improvements, 
are both relatively familiar 
problems to which no adequate solutions 
have yet been found. Less "traditional" 
areas include the consumer implications of 
new telemetric and metrological 
technology and issues arising from the 
electronic transfer of funds (automated 
banking). 

Unless Britain withdraws from the 
Community, other agenda items will flow 
from the work programme of the EEC 
Commission. The Commission, which on 
consumer matters generally has consistently 
promised more than it has achieved, is 
attempting to grapple with a variety of 
issues arising from the growing international 
· trade in electrical goods, 
holidays, toys, food and even broadcasting. 
Complex matters of safety, liability 
and redress have already been· raised. 
One objective of the new review body 
should therefore be to establish a 
framework -a set of working principles 
-which would provide the basis for a 
coherent national response to future international 
trade and consumer protection 
initiatives emanating from the EEC and 
elsewhere. 

Inevitably, "Mark II Molony" will also 
have to address itself to questions of e.nforcement. 
There is substantial evidence 
that the resources currently available to 
local authority trading standards and environmental 
health officers are stretched 
to breaking point. Low levels of enforcement 
are wrong in principle, demoralising 
to an over-extended inspectorate, and, in 
the end costly. It is a false economy to 
oblige local authorities, through rate-
capping and other financial penalties, to 
cut back on enforcement expenditure. One 
consequence is an unnecessary increase in 
the hospital population; another is 
foregone tax and national insurance 
revenue through lost production. Legislation 
is important, but so are the means 
necessary to enforce it. 

The new Committee would therefore 
have plenty to do. Indeed, perhaps the biggest 
difficulty will be to draw lines around 

30 



its work. The Committee's workload 
should be extensive enough to equip a 
Labour Government with the knowledge 
required to legislate in the more complex 
areas, many of which involve fast-moving 
new technologies, and realistic enough to 
enable that government to act on its major 
recommendations within the life-time of a 
single Parliament. 

Two other areas, both of which lie outside 
the scope of traditional consumer protection, 
should also be tackled during this 
time-span. These are plain language and 
the availability of advice services. 

Many consumer contracts, especially in 
the areas of credit-granting and housing 
tenancies, are so shrouded in gobbledegook 
that they are incomprehensible 
to the weaker party. The US State of New 
York has discovered a painless legislative 
solution to this problem which is worthy of 
emulation. It would be a simple matter-
and an impeccably democratic act -for a 
Labour Government to take up the National 
Consumer Council's Plain 
Language Bill at an early opportunity. 

One effect of a statutory requirement to 
use simpler contractual language would be 
to reduce the burden of work on the advice 
services. But the availability of these services 
-both generalist and specialist -is 
uneven. It is largely dependent on local 
authority discretion. The "right to 
understand" in this sense, or the "fourth 
right of citizenship" as it has been called, 
should be endorsed by socialists as it was 
during the period of the last Labour 
Government when a network of Consumer 
Advice Centres (CACs) was established 
with local authority funding. 

Most of these centres have now been 
closed; many other agencies face a similar 
fate. A renewed commitment to the future 
of law centres, Citizens' Advice Bureaux 
and other independent agencies is imperative. 
The right balance of advice agency 
provision is for discussion subject to 
assessments of local need. In any event, ex


perience suggests that sufficient provision 
will only be delivered if Parliament places 
an appropriate statutory duty on local 
authorities to conform with certain 
minimum requirements. This too should 
be a legislative priority. 

The "right to know" in the broader 
sense -the case for Freedom of Information 
legislation -has been sufficiently 
well-developed elsewhere. The scope of 
the new access law should extend to the nationalised 
industries, which are amongst 
the most secretive of our institutions. 
Other legislation will be required to provide 
for a fundamentally different approach 
to the running of publicly-owned 
enterprises. Renationalisation along 
Morrisonian lines, to underline an earlier 
point, will not be acceptable either to 
employees or to consumers. 

Price control is an exceptionally difficult 
area and one in which the short and 
long-term interests of consumers are often 
in conflict. A new Prices Act providing for 
the re-establishment of the Price Commission 
is nevertheless desirable. The 
Commission's principal task will be to 
monitor and investigate price movements 
in given sectors and to ensure that consumers 
are not exploited in monopoly, 
oligopoly or protected markets. 

The enactment of these measures within 
the framework of the kind of institutional 
reforms that I have outlined would greatly 
strengthen Labour's claims upon the consumerist 
constituency. But such claims 
would only be truly justified if Labour's 
thinking across the whole range of policy 
development were to be permeated with a 
thoroughgoing pro-user approach. After 
all most legislation is, in its effects if not by 
intention, consumer legislation on the 
broad definition. The performance of a 
future Labour Government -in housing, 
education, health, transport, social services 
and other fields -will be judged accordingly. 


31 


9. Conclusion 
Consumerist arguments and perspectives ought not to be regarded as 
marginal to socialist politics. On the contrary, they are of central impor


tance. 


Certainly there are conflicts; it would be 
foolish to underestimate the difficulties 
which they pose. Equally however, there is 
much common ground. In principle, no 
socialist should find objectionable a 
political prospectus which returns 
repeatedly to the twin themes of extending 
democratic representation to, amongst 
others, the consumers and users of goods 
and services; and of seeking ways to make 
the providers of goods and services more 
responsive to the needs of those who pay 
for them, directly or indirectly. Nor 
should there by any quarrel with the key 
consumer principles of access, safety, information 
and redress. 

The most serious potential for conflict 
arises from the stress placed by consumerists 
upon the primacy of the choice 
principle, with all that this implies for the 
role of markets. I have argued for a 
posJtJve, though selective socialist 
response to the consumerist position, to be 
located within an overall framework of 
economic planning. 

In industry, government and the public 
services, we have suffered from an inheritance 
of ''producerism''. This malaise 

has contributed to poor economic performance 
and has alienated consumers. 

In relation to the public sector taken in 
its widest sense, I have emphasised the 
convergence of interest which now exists 
between employees on the one hand, and 
users or consumers on the other. There is 
considerable scope for forging alliances 
designed to hold the line on jobs and services, 
and, more positively, to improve the 
overall quality of services provided. 

If we are to attract people to non-
bureaucratic forms of socialism we have to 
be able to show them alternatives which 
are persuasive. Labour Governments and 
local authorities, nationalised industries 
and other agencies, must each develop 
strategies which, being consumer-
sensitive, compel them to build houses that 
people want to live in; run utilities that 
their users are proud to identify with; and 
sustain the manufacture of safe, reliable 
and appealing products that set the standard 
on quality. In short, wherever there is 
an opportunity, we have to make possible 
the elaboration of what would be in more 
than one sense the consumer case for 
socialism. 

32 



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