‘Most people believe we’ve been living in some sort of crazy neoliberal lab experiment for the last 40 years… And that’s because nobody has tried to challenge it.’
This week on The Capitalist, I spoke to Lord Frost, who led the UK’s Brexit negotiations and later served as Brexit minister under Boris Johnson.
We discussed why Andy Burnham’s move towards rejoining the EU didn’t surprise him, why he thinks the stay-out side is at risk of complacency and why the campaign to keep Brexit’s freedoms needs to start now.
But much of the conversation was about what Britain has failed to do since leaving, and the ‘massive, massive liberalisation’ he says is needed. Frost resigned from the Johnson government at the end of 2021 because it wasn’t challenging the big-state, high-spend status quo. He sets out what he thinks has gone wrong: state spending well above early Blair-era levels, markets of every kind gummed up by regulation and the erosion of a shared national project. He also explains why neither the Conservatives nor Reform UK are yet going far enough, and what it would take to make the Civil Service serve ministers again.
Below, you’ll find some longer excerpts from the conversation.
Marc Sidwell
Editor, CapX
Don’t take Brexit for granted:
‘I think there is a real risk of complacency on the stay-out side now. I think there is an assumption that once people look at it, all this [the costs and conditions of rejoining] will come into play, but there will be arguments made on both sides. The strategic context has changed with Trump and with Putin, and with European defence and collaboration looking to many a more plausible proposition. So I think it would be a real risk to let Burnham do his worst and only then start campaigning… It is not enough to say, “Oh, it’ll never happen,” or “The British people don’t want to talk about it.” We will be caught on the hop.’
Why he left the Johnson government:
‘I have been disappointed. It’s one of the reasons I left the Johnson government all those years ago at the end of 2021, because I was uncomfortable that we were not seriously challenging the big-state, high-spend model. The previous Tory government didn’t challenge high spending, really. It got stuck on things like the Net Zero programme… We need a massive, massive liberalisation. None of that’s been done, and no real attempt has been made by anybody on the Right to persuade public opinion that it needs to be done. It obviously should have started five, six years ago. It should start now. That is the second-best time to do it.’
The ideas nobody has heard:
‘People have simply not heard these ideas for a very long time. Most people believe we’ve been living in some sort of crazy neoliberal lab experiment for the last 40 years and it’s time to get the state back into politics. And that’s because nobody has tried to challenge it. People on the Right don’t really want to do it. They don’t want to talk about the spending cuts that are necessary. They don’t want to talk about reforming the labour market again. But if they don’t, we are not going to solve the problems. That’s the basic difficulty. Therefore, they must.’
What’s gone wrong with Britain?:
‘One is we’ve just let state spending drift up too high. It’s 10 percentage points higher as a share of GDP than it was in the early Blair era. That in itself is enough to take 1% off growth, probably. Second, the markets are all gummed up. All our markets of all kinds are simply gummed up, over-regulated massively compared to where we were 20 or 30 years ago. The third bit of it, I think, is less economic and more cultural. I think it’s about the erosion of the sense of the British nation state’s political project – that we are all one country together, all pulling in the same sort of direction.’
The Right isn’t radical enough:
‘None of the parties on the Right are really pushing things enough. They’re not pushing solutions that are commensurate with the level of our problems… Similarly, Reform UK. I think it’s not enough just to suggest we can do this by removing benefits from non-Brits and migrants and so on. Obviously, it all helps, but we all know it’s not really the core of the difficulty… They need to find a way of being more radical, accepting that might come with a short-run political cost.’
No, Minister?:
‘This sense that the Civil Service is a kind of state entity in its own right, with its own role and own responsibilities to protect the constitution in some way – I think that needs to be killed off… We don’t need to tear it up and start again, but we do need to water down Northcote-Trevelyan quite a lot. We do need ministers to have real control… Simply ranting about the blob is not going to do it. It’s not like there’s some plot among the Civil Service to stop things happening. They are operating in a system where the incentives are less to serve the government of the day and more to do other things, and therefore you have to change the incentives.’
