Labour wants to drag Britain back to 1970s
SHADOW chancellor John McDonnell sparked a business backlash yesterday by unveiling his socialist vision for Britain.
It included a right for workers to take over the companies that employ them.
He set out plans to borrow £100billion to create a national investment bank which would splash the money on infrastructure and “skills”.
Salaries
He denied the massive debt would send taxes rocketing and said he thought that the loan would “pay for itself ” by triggering economic growth.
Mr McDonnell told the Labour Party conference in Liverpool that he would boost the power of trades unions and allow them to control collective bargaining for wages across whole sectors of the economy.
A Labour government would also increase the Living Wage to at least £10 an hour – it’s currently £7.20 an hour – with taxpayers shelling out money to help smaller firms meet the bill.
Mr McDonnell said he was “interested in the potential of a universal basic income” – flat-rate weekly benefits paid to every adult in the UK, in work or out – which would cost at least £8billion a year.
Delegates applauded as the hard-Left veteran asked them to imagine the effect of his policies.
Critics said they would drag Britain back to the 1970s. But he said: “We will be developing policies that will shift the tax burden more fairly, away from those who earn wages and salaries and on to those who hold wealth.” Labour, he said, would be “an interventionist government”.
Mark Littlewood, directorgeneral of the Institute of Economic Affairs think tank, said: “John McDonnell’s speech was the epitome of fantasy economics.
“The fact he’s proudly trumpeting Labour as a party of interventionism despite its catastrophic historical record should worry business and voters.
“It’s time for the shadow chancellor to get real.”
Conservative MP David Gauke, Chief Secretary to the Treasury, said: “Labour would leave working people worse off by spending, borrowing and taxing even more than they did last time.”
Combative
Manufacturers’ organisation EEF warned that returning to collective bargaining was “a backward step” and that a £10 minimum hourly wage would take minimum pay up to £19,250 a year.
With add-ons, it would put up the cost of hiring a new worker to £23,000.
CBI director-general Carolyn Fairbairn said businesses would be wary of Mr McDonnell’s combative tone and focus on intervention.
Simon Walker, boss of the Institute of Directors, said that a return to subsidising industry through bumper levels of Government borrowing was the last thing that Britain needed.