New Labour approached a macro-economic policy and moving towards capitalism whereas Old Labour were more towards micro-economics and socialism. Because of globalisation, Labour shifted towards a macro-economic policy. New Labour’s main concern was inflation and increasing income tax by putting emphasis on prudency. Labours modernizers explained that although they encourage public spending, they did not ordered to increase spending nor decreasing it. Their main objective is to aim for investment and developments in economic to tackle inflation and taxes. Therefore, Labour approached a cautious start by relying on Conservatives budget plan to limit spending. The first policy carried out during Labour’s government is the independence of the Bank of England. New Labour focuses on low inflation in hope to reassure voters that the mistake from the past would not occur again. The policy limits the government’s control on the economy by restraining the liberty of the state’s …show more content…
Blair’s decision to change the constitution is the third characteristics of New Labour. Reforming the House of Lords was always been Labour’s policy and was further emphasised in Neil Kinnock’s Policy Review. He proposed to change the Lords in order to balance one’s freedom and limiting the power of the Lords. During Blair’s government in 1997, he created a Scottish Parliament and Welsh Assembly to pledge devolution for Scotland and Wales.
The final characteristics of New Labour is welfare and social policy. Atlee established the welfare state and was considered as the “most significant achievement” (Eric Shaw, 1996) of Labour’s government in 1945. Two years into Blair’s administration, he established a reform programme on welfare policy calling it ‘Welfare-to-work’. The main aim of the programme was to accomplish ‘The New