Dear friends,

I am giving a speech this morning at Policy Network called entrepreneurial socialism – it sets out how the Labour Party can unite around the fight against inequality with a #NewClause4.

You can read my Guardian article from yesterday here or below:

My new version of Clause IV charts a way forward for Labour

When Jeremy Corbyn sealed his stunning leadership victory, he boldly promised “real debate, not message discipline”.

Jeremy was right. And now we’re making progress hammering the Tories on tax credits, it’s time for progress with the real debate that was promised. We need to offer voters more than anger. We need to offer an alternative.

But before we get started, let’s remember this: every single part of the Labourparty needs to respect Jeremy’s mandate – and his mantra: the fight against inequality is central. For we now live in a land where we’re multiplying the super-rich and the super-poor. The number of billionaires is up by nearly 50% since before the crash – while 300,000 more children live in poverty. Corporate bank accounts are full – while children’s tummies are empty.

New Labour achieved so much in office. But we all know it’s now time to bury neoliberalism. The old rules aren’t solving our problems. The old rules are the problem.

Once upon a time, we said: deregulate, cut taxes, break down walls to free trade and enshrine “shareholder value” in company law. We prayed it would create good jobs and wealth that was shared. But guess what? Today’s global super-companies, bigger than countries, aren’t honouring the deal.

They’re not investing in creating good jobs – and all rewards are going to the top. Today, private investment is still lower than before the crash – despite £16bn in corporate tax cuts. There’s a mind-blowing £522bn in company bank accounts – and firms paid out £100bn last year in share buy-backs. Result? Three quarters of the “knowledge economy” jobs created since 2010 are in management consulting – while the number of advanced manufacturing jobs has fallen. And while median hourly pay is down some 9%, directors’ pay has rocketed to 120 times average pay.

Inequality is not inevitable. As Joseph Stiglitz argued in last month’s thought-provoking Rewriting the Rules, institutions matter – and right now they’re broken. So we need to rewrite the rules.

In his leadership campaign, Mr Corbyn proposed many things on which we agree: “tax justice”, rebalancing the fiscal burden, “welfare efficiency”, industrial policy, a green plan and devolution. But there are other ideas we should debate in a spirit of mutual respect. For instance, I personally think there’s an alternative to“People’s QE” or printing money, renationalising things and loads more public spending.

I think there’s a better way: rewriting the rules for our economy – starting with the Bank of England, our financial markets, our company boards and the OBR, plus our schools, our science base, and our social security system.

We should give the Bank of England a new mandate to aim for full employment – like the US Humphrey-Hawkins Act. In our capital markets, the average length of time for owning a share is down from six years in 1950 to less than six months today. So, we should give long–term investors a bigger vote – like France’s newFlorange law. And while we’re at it, let’s have a US-style Community Reinvestment Act to channel investment into deprived communities and sort out the rules so pension fund trustees know they don’t have to chase quarterly profits. Because investors hold shares so briefly, we should give long-term stakeholders – such as workers and creditors – more power on company boards as they do in Germany.

And it’s time we had a budget watchdog that reported to parliament on how we close the tax gap. Our inability to forecast tax is hobbling our efforts to budget prudently or to make sure big firms pay up. Indeed, out of George Osborne’s 11 budgets, he has missed his tax forecasts in eight of them.

To crowd in more investment to science and innovation, we should raise science spending to 3% of GDP, to match the Germans and South Koreans. In our schools, we should rewrite the national curriculum to help accelerate a young entrepreneurs’ revolution by delivering enterprise education to every child in every school.

And crucially, we need to re-found our social security system, reintroducing the contributory principle and an earned entitlement to subsidised lifetime loans for college, apprenticeship study – or simply reskilling, a little like the HELP loans in Australia.

I don’t believe that debate is disunity – but I’ve been around long enough to know that unity is strength. So, we need to start this debate by making sure we’re all on the same side. So as we begin debating how we rewrite the rules of our economy, we need to rewrite the rules of our party.

As Yvette Cooper pointed out this summer, it’s 20 years since we updated Clause IV. And today’s Clause IV doesn’t even mention inequality. That’s wrong. We need to say what we mean – and mean what we say. Our aims need to reflect our ambitions. So today, I’m publishing a draft of a new Clause IV, just to get the conversation started. As the great John Prescott once put it, it’s time once more to put our traditional values in a modern setting. And get down to business making the 21st century a Labour century.