Returning from paternity leave, Ed Miliband has set out his stall on how Labour will rethink its policies under his leadership. Most leaders of the opposition establish policy reviews of one kind or another, to wipe the policy slate clean. David Cameron set up a number of policy review groups that produced little but headaches for him, in contrast to his wider brand repositioning, which was largely successful. In his first two years in the job, he established a clear character for his leadership of the Conservative Party: liberal, green and centrist. In those early days, the direction of travel was much more important than the detail.

Referring to Cameron's scene-setting Arctic jaunt, Mr Miliband has said he 'won't do huskies'. So what will be the character of the Labour Party under his leadership? What will be the core components of its political identity? To help work this out, here are seven character tests for the Labour leadership.

1. Will Labour be a liberal party?

As the shadow of 9/11 has receded, British politics has become more liberal. Barring a catastrophe, it will remain that way. Parties are also more liberal in opposition than when they exercise the levers of power for themselves, and in this Labour will be no different. Younger cohorts of voters are more tolerant and diverse than older ones and so the underlying trend is towards a more liberal polity.

Ed Balls' weekend comments confirm the liberal direction of travel set out by Ed Miliband when he became leader. The challenge for Labour is to reconcile this liberalism with currents of small 'c' conservatism amongst the electorate, which is now both increasingly liberal and more conservative in unpredictable ways. In particular, it will want to respond to the public's desire for swift and tough action to be taken against incivility and antisocial behaviour, which spans the social classes but is particularly acute in Labour-held seats. No political party can safely allow itself to be seen as indifferent or unresponsive on low-level crime and antisocial behaviour.
 
2. Will Labour be pluralist, in favour of democratic and constitutional reform, and open to the politics of coalition? Or will it revert to its tribal core?

Tribalism runs deep in the Labour Party, spanning the right and left of its MPs and membership, and it is particularly strong in Labour’s traditional heartlands of Scotland and northern England. Its tribal MPs regard democratic and constitutional reform as an irrelevance at best, a harmful electoral distraction at worst. They have no appetite for supporting the 'Yes to AV' campaign and even less for reaching out beyond party lines to connect with progressive Liberal Democrats.

Ed Miliband is different: he is a democratic reformer who has spoken warmly of the radical liberal tradition in British political thought. Even if he is hostile to Nick Clegg's leadership of the Liberal Democrats, he is more open than much of his party to building new progressive alliances with progressive social liberals.

In this he is on the right side of history. The vote share of the two main political parties in Britain has fallen from 97 per cent in 1951 to 65 per cent in 2010, its lowest share since 1918. In Europe, a similar story has unfolded, as the voting blocs of 20th century class politics have disaggregated. Social democratic parties are polling 25–30 per cent of the popular vote and coalition politics is the norm. All of this strongly suggests that Labour will have to get serious about pluralism, whatever the fluctuations in the polls.

3. Will Labour be an egalitarian party?

The answer to this is obviously 'yes'. Ed Miliband has gone further than his predecessors in committing Labour to the goal of reducing inequality, and not just to narrowing the gap between the poor and the middle class. Yet he also recognises that the Croslandite model which sustained New Labour’s social justice ambitions – of redistributing the proceeds of growth – had run its course by 2008.

Naturally, all governments tax and spend: that is their core business. The big question for Labour is whether it can develop a new model of economic growth that is capable of generating a fairer distribution of market rewards than has been the case for the last 30 years, and so lessening its reliance on secondary redistribution. Ironically, Labour is likely to enter the next election as a fiscally conservative party, for the simple reason that insurgent parties don't often win by promising tax increases. If that is the case, however, it will have to become more social democratic on economic policy, lest it be punished once again for failing to give an account of how to increase the living standards of the broad mass of the population.
 
4. Will Labour be localist or centralist?

This is a key question of statecraft for Labour. In opposition, parties tend to become more localist because they win local government elections and councillors become disproportionately important amongst the activist base. This is what happened to the Conservative Party: it was highly centralist in the 1980s and then became localist in opposition (albeit with a preference for civic and public service markets, rather than a powerful local state). New Labour's 'delivery state' chalked up some remarkable successes before it ran out of steam, when Labour ministers were left defending a hotchpotch of indicators, targets, inspection regimes and local area agreements. New Labour statecraft had run its course and the abandonment of much of this centralist architecture has given the Coalition early ideological momentum.

However, there are clear tensions in the government about how to interpret localism, with supporters of local government arguing against proponents of quasi-markets (witness Michael Gove's retreat on school funding). Sooner or later, each of the political parties will have to decide whether localism really means what it says on the tin, which will require a new local government funding base, more devolution of powers and other measures (see ippr north's discussion paper Five Foundations for Real Localism).

5. Will Labour embrace small 'c' conservatism or left communitarianism?

There is an emerging new left communitarianism - epitomised by Jon Cruddas, Maurice Glasman and others - which I've written about before on this blog and elsewhere. It takes seriously a popular concern to preserve and cherish valued local institutions, like the pub and post office. It attends to local organisations of self-government, like mutuals and community groups. It believes that expressions of political identity like 'Englishness' increasingly matter, and it backs community organising as a principal motor of Labour's renewal. It has influence across the Labour Party, as the leadership campaigns of both the Miliband brothers testified.

It would be a major act of bold political leadership to decide to embrace the conservative strands of this thought – and the sentiments and concerns amongst the British people to which they respond - in Labour's new identity. Yet it would also pay dividends, equipping Labour with an account of social patriotism which it currently lacks and which renders it literally speechless on some core voter concerns. It would also allow Labour to embrace the Burkean strands of the Big Society debate, instead of condemning the concept out of hand.
 
6. Will Labour be reformist on public services?

There is a clear fiscal imperative for Labour to support reform of public services if it wants to preserve universal entitlements and collective provision. Ageing will add about 6 per cent to the share of GDP taken up in public services, so it is imperative that costs are controlled, productivity enhanced and reforms secured which can promote both equity and efficiency in the public sector. Politically too, the lesson of the Brown years for Labour is that parties lose support when they do not offer a compelling vision of how public services can be improved and made more responsive to their users. Currently, the political ground on reform has been ceded to the Coalition.

All of this means that Labour must rediscover its appetite for public service reform, even if it does not support the detail of the Coalition's plans in every area. Strategically, it must place its big bets on services that matter most to achieving full employment and raising family living standards - childcare and care of the elderly in particular -  rather than simply spin the wheel again on schools and the NHS, the big winners of the New Labour era. Fortunately, collective services like the NHS stand out as the most efficient and fair ways of meeting rising social needs in an ageing society, as long as they are personalised and responsive, and costs are controlled.

7. Pro-European, progressive globalisation?

New Labour was intellectually pro-European but politically cautious in advancing the case for Britain in Europe. It was more full-throated in its commitment to the benefits of globalisation. Current circumstances are not propitious for either kind of internationalism, as the after-shocks of the global financial crisis of 2008 continue to reverberate. In the long run, however, there is no future for Labour in a strategic retreat into anti-globalisation, nor in a tepid Euro-pragmatism. Both are political cul-de-sacs. A progressive future will only be built through outward engagement in Europe and beyond.

There are other ways of setting these tests. I have not chosen, for example, to list anything on environmentalism, since I take it as read that Labour will continue to develop its green credentials under Ed Miliband's leadership. Nor do these seven tests tell us anything about Labour's organisational form or its internal constitution. They are simply framed to guide how we might think about its political character. But how it answers these tests will be critical in determining its political future.

Cross posted from Nick Pearce's blog at ippr.