Democratising public ownership: Labour’s new consultation

Today, the Labour Party launches an official National Policy Forum consultation on the subject of democratic public ownership.

After decades in which policy has been bound by the reigning neoliberal orthodoxy, public ownership is making a comeback. All around the world, activists, politicians, and civic leaders are rediscovering its potential to address some of our most important challenges, including climate change, increasing inequality, and political disenfranchisement. In just the past few months, there has been a cascade of examples of the new saliency of public ownership:

  • The governor of Jakarta, Indonesia—a city with some ten million people—committed to returning the water system to public hands;
  • Public ownership was included in the widely publicised Green New Deal legislation in the United States;
  • Residents in Baltimore, Maryland, voted to amend their city charter to ban water privatisation;
  • Neighborhoods in Berlin have stepped up their plans to bring thousands of housing units into public ownership to prevent price hikes and displacement.

Importantly, the new wave of public ownership is increasingly understood as needing to avoid some of the limitations of past models—including the overly centralised, opaque, and managerial top-down public corporation model of the postwar period, which was deliberately kept at arm’s length from democratic accountability and control. Instead, a defining feature of the return of public ownership around the world is a desire to make these enterprises and services as effective, accountable, and democratic as possible, and to avoid simply perpetuating the failings of past models.

The aim is to develop powerful new forms of public ownership that stimulate broad-based participation, increase accountability and transparency, and empower communities and individuals that have traditionally been excluded from economic decision-making. In sum, what is needed is democratic public ownership, an approach that that combines the benefits of broadly shared ownership—such as more equitable distributional outcomes—with the individual and societal benefits of confronting alienation with increased agency and empowerment.

When it comes to developing and advancing this vision at scale, all eyes are now on the British Labour Party. Relatively uniquely amongst many of the world’s large, mainstream political parties—many of which are still wedded to a failed neoliberal agenda and out of step with current events and political developments—the Labour Party has committed not only to a wide-ranging program of public ownership (in water, mail, railways, energy, and banking) but to radical new models of governance, accountability, and transparency. “Nationalisation,” John McDonnell affirmed during his 2018 conference speech, “will not be a return to the past. We don’t want to take power away from faceless directors to a Whitehall office, to swap one remote manager for another.”

Today, the Labour Party launches an official National Policy Forum consultation —the formal process by which the party democratically develops policy—on the subject of democratic public ownership.

Introducing the consultation, McDonnell and Rebecca Long-Bailey identify both the magnitude of the opportunity and the challenge, writing that

Democratic public ownership is a chance for the biggest transfer of economic power the UK has ever seen—a way of putting people in control of their lives, not just after clocking off, but at work too. Giving people a direct say in decisions about working hours, wages, investment, new technology, and health and safety, promises to make people both more fulfilled and more secure.

Simply put, democratic public ownership is an opportunity to bring about a fundamental paradigm shift in how economic and political power is distributed in our economy and society, moving it from the hands of the few to the many.

The core principles of democratic public ownership—including transparency, accountability, and participation—are also vital to the process of how democratic public ownership is designed. The National Policy Forum consultation process is a unique opportunity in this regard. In a historic new departure, hundreds of thousands of ordinary people, as well as key stakeholder groups (such as trade unions, consumer groups, and non-profit organisations), are being given the opportunity to directly participate, democratically, in redesigning the ownership and governance structures of major economic sectors. It is up to all of us to provide input on the numerous questions that need to be answered, trade-offs that need to be made, and tensions that need to be resolved around a new model for a truly democratic public ownership.

It is also an important responsibility. The Labour Party has set itself apart by making the simple, yet radical argument that in a world beset by a re-emergence of fascism and existential threats such as climate change, the way forward is not to shy away from democracy in favor of rule by international technocratic elites, but instead to double down on democracy, especially in the economic sphere. Success in this regard could have very far-reaching effects, perhaps eventually heralding the dawn of new global system built, from the ground up, on principles of equality, sustainability, and economic democracy. The consequences of failure, on the other hand—and of abandoning the field to a struggle between an insurgent neo-fascism and a dying neoliberalism—are unthinkable.


Thomas M. Hanna (@ThomasMHanna)

Thomas M. Hanna is research director at The Democracy Collaborative and author of Our Common Wealth: The Return of Public Ownership in the United States (Manchester University Press, 2018). With Andrew Cumbers, he assisted the Labour Party prepare the consultation on democratic public ownership.