£500 for workers promise

Plans for employee ownership schemes in large companies could net almost 11 million workers up to £500 a year each, shadow chancellor John Mcdonnell has said.

Additional dividends would go towards a national fund to pay for public services and welfare, raising an estimated £2.1 billion a year from private business, Labour have said.

Mr Mcdonnell announced plans for “inclusive ownership funds” (IOFS) at the TUC congress in Manchester earlier this month, telling union leaders they would give workers “a say in the management and direction of their compa- ny”. In his keynote speech to Labour’s conference in Liverpool, he will pledge that workers will also receive dividend payments direct from the fund.

Under Labour’s plans, legislation would require private sector companies with 250 or more employees to transfer at least 1 per cent of their ownership into an IOF each year, up to a maximum of 10 per cent. Smaller companies would be able to set up a similar scheme on a voluntary basis.

Labour estimates that 40 per cent of the private sector workforce – some 10.7 million people – will initially be covered by the scheme. Dividend payouts will be made at a flat rate to all employees of the firm.