Clause 4 and Common Ownership

Common Ownership & Popular Administration

Why All The Fuss?

by Chris Winch

It is easy to assume that Clause Four and, in particular, part 4, of the Labour Party constitution, represents a kind of Leninist, or, at least, dogmatic advocacy of state ownership of the means of production, distribution, and exchange. Close examination of Clause Four reveals nothing of the sort.

It is hard to see why it should be interfered with, given the useful breathing space that our internal doctrinal debates will give to the Tories, at the very moment when they are in a desperate condition themselves. So here is the non-Leninist, non-statist case for leaving it well alone.

Clause Four, Part 4 refers not to the state or even to the public ownership of the means of production, distribution and exchange. It refers to common ownership. As Stephen Pollard (research director of the Fabian Society) points out, in an important sense we already have quite a lot of this:

“There is no point, for instance, in striving for ‘common ownership’ because, in a sense, we already have it. The contributions of the 11 million people with pension schemes provide £500 bn of capital; 35 million owner occupiers with endowment mortgages and life insurance (as well as property and car insurance) own two-thirds of the shares in UK companies. The funds are the largest source of capital in the economy. Where 30 years ago two thirds of the shares in UK companies were owned by individuals, today the British people already own much of British industry.” (Stephen Pollard, To Be Fair, Clause IV Must Change. The independent, Monday 20th November 1994, p.17).

Since this does not solve all our problems, Pollard concludes that Clause Four should go. (In fact it would make more sense to demand a more democratic form of administration of such funds, which has happened in Australia.)

This is puzzling, if the reason that it should go is, on the one hand, that it represents an out-of-date aspiration towards a statist utopia, how can it also be the case that it should go because it already represents mundane but imperfect reality?

But Pollard is right, we do already have a large measure of common ownership and that fact does not mean that all is well for British workers and their families. In addition we need to think about other forms of common ownership, such as ownership by trade unions, co-operatives and municipalities. There is no need to get hung up on one particular form of common ownership.

Clause Four Part 4 does not rest content with common ownership, however, it refers also to “the best attainable system of popular administration and control of each industry or service. ”

We certainly do not have that, and without it common ownership is diminished in value. But popular administration and control can take many forms, ranging from state direction, through co-determination at the national level, to various forms of industrial democracy.

These things are not just desirable in themselves, they have the virtues of increasing worker involvement, enthusiasm, co-operation and productivity, as well as reducing exploitation and injustice.

We had a good chance of increasing popular administration and control when the Bullock Report on industrial democracy was published in 1977. The report was never implemented because sections of the party and the trade union movement on both the left and the right opposed it. A little bit more attention to the detail of Clause Four at the time might have helped focus the party’s attention on what was at stake with Bullock.

There is an irony in this. Much of what I have been advocating was argued for by Anthony Crosland in 1960 in a chapter of his book, The Conservative Enemy, entitled Industrial Democracy And Workers’ Control (published by Jonathan Cape, 1962). But, absurdly, Crosland thought these arguments were a good reason for supporting the Gaitskell position that Clause Four should go.

Clause Four seems to represent a practical and non-utopian objective that is never likely to be fully realised, but is always something to be striven for. Part 5 states that the party exists to “promote the Political, Social and Economic Emancipation of the people and more particularly of those who depend directly upon their own exertions by hand or by brain for the means of life.”

This does not look forward to a utopia. The work of emancipation is probably never finished; people will always be treated unjustly, be exploited and ridden roughshod over by bosses and managers and by their fellow workers; such is the way of the world. This does not mean that such things should not be prevented and minimised wherever possible.

Some of the means for doing so lie in diverse forms of common ownership, chosen on their merits according to the situation and made effective by a variety of methods of popular administration and control, again chosen for their merits according to the particular situation.

Clause Four does not call for extreme egalitarianism; instead it talks of ‘equitable’, i.e., fair, distribution. It defines workers very broadly, as those who depend directly upon their own exertions for the means of life. There is no mention of the industrial proletariat beloved of Leninists and Trotskyists.

It remains the case that, despite a degree of common ownership, most people still depend and will continue to depend on their own exertions for the means of life for the foreseeable future. Neither is there any mention of abolishing the market. In fact nothing is said about this. Common ownership and popular control have implications for the workings of the market, but these are by no means determinate.

As Pollard says in his article, it is possible to trade in the market for social, as well as purely profit-making purposes and, in addition, there is no reason, apart from dogma, why commonly owned organisations should not trade for profit in the market place. Clause Four raises no barriers to this and leaves the question of the nature of the market and the degree of control that should be exercised over it entirely open. This is as it should be in a party committed to the pragmatic advance of the interests of the broad working class.

If Clause Four were to be abolished tomorrow, there would still be disputes amongst socialists about the desirability of state ownership or industrial democracy and this is as it should be.

What is so regrettable is an unnecessary controversy about a sensible and practical clause in the party’s constitution, which seems to have stood the test of nearly 80 years’ politics very well. If the debate draws the attention of members to what the clause really says, then perhaps it will have done some good after all.


This article appeared in January 1995, in Issue 45 of Labour and Trade Union Review, now Labour Affairs.  You can find more from the era at and