Water companies added to flood of uncosted nationalisations
Labour manifesto launch reveals extra pledge on government ownership, but without funding details
LABOUR yesterday announced that water companies will be included in its plans to nationalise Britain’s infrastructure, but its manifesto contained no explanation of how it would be funded.
A draft copy of the manifesto, leaked to The Daily Telegraph last week, contained plans to nationalise the railways, Royal Mail and National Grid, but while water companies have been added to that list, the money to pay for it has not increased.
The Conservatives described the manifesto as “a shambles”, joking that it seemed to have been costed by the shadow home secretary Diane Abbott, who famously got her figures muddled when announcing a policy on extra police officers earlier in the campaign.
Labour intends to nationalise the utilities using £250 billion worth of borrowing. The manifesto makes no attempt to break down the cost of nationalising each industry, or put a price tag on other major capital projects, such as extending HS2 to Scotland.
Jeremy Corbyn said he could not specify the cost of each project because “we don’t know what the share price would be at the time that we do it”.
Other projects to be paid for out of a new national transformation fund include setting up publicly run energy companies, a new “Crossrail of the North” linking Newcastle and Manchester, and superfast broadband for all.
Labour also intends to build a new mainline track to Brighton, electrify the entire rail network, invest in renewable energy and low-carbon gas power stations and deliver funding for scientific research.
Mr Corbyn said recently “we should not be afraid of debt or borrowing”, but Theresa May has said his plans will “bankrupt” the country. Here we analyse key points of the manifesto.
Brexit
Pledge: Rejection of “no deal” as a “viable option” and legislating to ensure Parliament has “a truly meaningful vote on the final deal”.
Scrapping the Great Repeal Bill, replacing it with an EU Rights and Protections Bill “that will ensure there is no detrimental change to workers’ rights, equality law, consumer rights or environmental protections as a result of Brexit”.
Analysis: Ministers have repeatedly said the ability to walk away without a deal must remain an option if Theresa May is to have a strong hand in negotiations.
Migration
Pledge: The manifesto contains no pledge to reduce net migration and makes “no apologies” for putting jobs, growth and prosperity “before bogus immigration targets”. Instead, Labour promises “fair immigration rules” and says that in areas where immigration has placed a strain on public services extra money will be made available for those services. The rights of EU nationals already living here will be guaranteed immediately.
Analysis: Immigration has proved hugely divisive for Labour, which risks alienating its core voters in northern heartlands by refusing to commit to cutting migration.
Lord Green of Deddington, chairman of Migration Watch UK, said it was “the worst possible manifesto” for anyone worried about migration, reflecting an “arrogant disregard of many people’s genuine concerns”.
Pensions
Pledge: Maintaining the pensions “triple lock” that ensures pensions rise by inflation, average earnings or 2.5 per cent, whichever is higher. Winter fuel allowance and free bus passes to remain a universal benefit. State pension age fixed at 66, rather than rising to 67 in 2028, as is current policy.
Analysis: This policy could prove to be one of Labour’s most expensive commitments. Steve Webb, the Liberal Democrat former pensions minister, has said this would cost £300 billion by 2046.
Workers’ rights
Pledge: Labour would lift the public sector pay cap, at a cost of £4 billion, introduce a “real living wage” of at least £10 per hour by 2020 and ban zero hours contracts.
It would also guarantee trade unions a right to access workplaces so unions can speak to members and potential members. Unpaid internships would be banned. Analysis: Higher wages for the low-paid are populist measures, but could result in fewer jobs.
Ryan Shorthouse, of the liberal conservative think-tank Bright Blue, said: “Raising the national minimum wage to £10 per hour by 2020, without consideration for the performance of the economy, risks reducing the supply of jobs. Banning zero-hours contracts altogether, meanwhile, removes from some people employment that they want and like.” Raising the living wage to £10 would cost nothing, according to the manifesto, because it would all be funded by business.
Defence
Pledge: Renew the Trident nuclear deterrent and spend at least 2 per cent of GDP on defence. Analysis: Jeremy Corbyn’s draft manifesto
‘The worst possible manifesto for anyone worried about migration’
originally said that Britain should be “extremely cautious” about using the nuclear deterrent.
The comment prompted a huge row in the Labour Party, with Mr Corbyn ultimately backing down and removing the warning about using nuclear weapons.
Education
Pledge: Abolishing tuition fees and reinstating maintenance grants, which Labour estimates will cost £11.2 billion.
Mr Corbyn’s party has also pledged to increase school funding by
£6.3 billion and invest a further £2.5 billion in further education
Analysis: Scrapping tuition fees has provoked controversy in shadow cabinet amid concerns that it will benefit middle-class children significantly more than the poorest in society.
Childcare
Pledge: Extending 30 hours of free childcare a week to all two-year-olds and some one-year-olds at a cost of £5.3 billion. Labour will also consider plans to extend maternity leave to 12 months and would replace childcare vouchers with direct state funding on nurseries.
Analysis: Both economists and childcare experts believe that the policy could cost significantly more than the £5 billion pledged.
NHS
Pledge: Spending an extra £30 billion on the NHS over five years to take 1 million people off waiting lists, offer free hospital car parking and improve hospitals. An extra £8 billion will be spent on social care.
Analysis: Labour has said it will meet the pledges by hiking income tax for those earning £80,000, raising insurance premium tax on private healthcare and increasing corporation tax. Economists, however, have warned that the tax proposals may raise little or nothing.
Council tax
Pledge: A Labour government would give local government £1.5billion of extra funding for next year and initiate a review into reforming council tax and business rates and “consider new options, such as land value tax”.
Analysis: The plans would see people taxed based on the value of the land that they own rather than the value of their properties. It would see a dramatic shift in taxation, with Britain’s biggest landowners paying significantly more while most people would see their bills cut.
Economists have long backed the idea of introducing a land tax, arguing that a tax on the rental value of land is fairer and more efficient than other taxes.
Capping executive pay
Pledge: Company bosses will be banned from earning more than 20 times their lowest-paid worker if they take government contracts in a crackdown on “boardroom excess”.
Analysis: The Institute of Directors has described the policy as a “knee jerk reaction” and warned that it could damage business.