Will Gordon Brown's tight grip on public spending end academics' love-in with Labour, asks David Walker in the first of a series on social exclusion. Universities, Bahram Bekhradnia (right) points out, already have difficulties taking more students from poor families

It's 8am. Chancellor Gordon Brown is already at his desk. Guests are arriving at Number 11 Downing Street for the first in a series of policy seminars organised by the John Smith Institute - a new think tank of Brownist mien.

The subject is welfare reform. The chancellor is supposed to stay for half an hour but sits on, listening intently, scribbling notes. This is the inner loop in operation. And to judge by the guest list, social policy academics are in it - Ruth Lister from Loughborough, Nick Barr and Julian Le Grand from the London School of Economics, Hilary Land from Bristol. Social exclusion may be their subject matter, but it does not describe their position in the government's power structure.

If chancellor Brown's breakfasts are a guide, new Labour and the social policy specialists in the universities are enjoying a close relationship. Indeed, while Le Grand's inclusion is only to be expected (he and fellow LSE professor Howard Glennerster are noted for supporting the government's line), the appearance of Ruth Lister's name on the roster for Number 11 shows how things have moved on since last year. It was only in October she put her name to that celebrated letter by social policy professors to the Financial Times published while Labour was in conference at Blackpool attacking the new government over its plans to cut the lone parent premium and refusing to increase cash benefits to the unemployed.

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But since then Lister, former director of the Child Poverty Action Group, has been credited with changing the chancellor's mind over tax credits for working women, the centrepiece of his Spring budget, ensuring that they are going to be claimable by the woman in a household. And Lister's subsequent endorsement of the budget was appreciated in the highest circles.

Suddenly, you can hardly turn a corner in London without being confronted by lively debate involving "welfare" academics, advisers and often ministers ... in ad hoc seminars inside Whitehall, at the Institute for Public Policy Research, the Employment Policy Institute and, especially, at the LSE in such units as the Centre for Analysis of Social Exclusion. Few such occasions would be complete without the LSE's Blairite director Tony Giddens and at least one of his professors.

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But if that makes it sound like a love-in between the social policy establishment and new Labour, albeit delayed by a year, there are plenty of academics who would disagree. Is this a government willing to tackle the "structural" causes of poverty and inequality? If it is, say these academics, its methods will need to run deeper and wider than anything currently on the agenda, say, of the Social Exclusion Unit established in the Cabinet Office last year.

"The unit is looking at (the problems of) council estates and school exclusion rather than investigating the structural causes of poverty and what can be done through government action", says one professor from outside the charmed circle, voicing a general complaint. "New Labour's agenda is a more liberal version of conservative orthodoxy," says another. This government is no more invulnerable to an economic downturn than any other, says yet another critic, "and an economic downturn could have very severe implications for the future of Labour's flagship Welfare to Work policies".

If Ruth Lister is happier with the government than she was, many of her co-signatories of that Financial Times letter sound as if they are still unpersuaded about new Labour's virtues. Peter Taylor-Gooby of the University of Kent says that "this government has been concerned to set and control the agenda, and this has led to the ruling out of consideration policy options that many academics consider appropriate, for example in the debate about the future of pensions. It's not so much us and them as the extent to which different alternatives actually enter into the agenda of debate: I do feel a concern that the focus is very much on particular perspectives."

Some academics apply a "`proof of the pudding" test - is the government commissioning more research; is the government applying a concern about social exclusion and inequality to academics' own backyard, the universities? The verdict on both counts is failure. Jonathan Bradshaw of the University of York warns against mistaking a flurry of London-based activity inside fashionable think tanks for intellectual progress. "No new research has been commissioned by the Department of Social Security that wasn't in the pipeline before the election. There's no activity yet on Frank Field's green paper on the reform of welfare. The Department of Health research programme hasn't emerged."

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"We don't yet know,'' says Taylor Gooby "whether they are going to be willing to face difficult evidence". He cites the debates about funding higher and further education, and the risk that tuition fees will deter working-class students from applying for university. He emphasises the importance of non-governmental funds, notably the philanthropic charities such as the Rowntree Trust and Nuffield Foundation, in providing independent monitoring of government initiatives.

But those are critical voices. Other academics working on social exclusion find it hard to suppress a lively sense of participating in the business of practical reform. Earlier this year the Treasury - long regarded as the bastion of fiscal conservatism and policy immobility - convened a series of seminars on provision for children below the age of eight to consider the idea that more spending now on socially disadvantaged children could save money later, in terms of school exclusion, youth crime and adult dysfunction.

"It was extraordinary," says John Bynner of City University, who took a leading role in laying out the empirical evidence. "One gets the impression there is real listening going on". Bynner is optimistic that the government wants to hear the evidence, even going as far as suggesting that the much vaunted "Third Way" for Blair means basing policy firmly on evidence. "It used to be said that aetiology (studying causes) was of no interest to policy makers. But this government is encouraging longitudinal studies which won't produce results for years."

Nonetheless Ruth Lister's eyes, along with those of all her colleagues, are on July. It is then that the government will publish the results of its nine month "comprehensive" examination of spending. This will amount to its declaration of faith, or not, in public expenditure over the next three years. Academics, as beneficiaries of public spending, tend to take promises to spend as a sign of governmental goodwill. In the social policy community at large, the favour that new Labour has started to find will take a sharp knock if Gordon Brown, having breakfasted, decides to continue with the Tory spending trajectories he committed the government to a year ago.

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