Tories: state broadband breaches EU rules

LABOUR has sought formal legal advice that Jeremy Corbyn will still be able to implement one of his flagship election pledges if he keeps the UK in the European Union.

The Sunday Telegraph understands that a QC has provided the party with advice on the legality of creating a nationalised broadband service, under state aid rules and other relevant laws.

The disclosure highlights Mr Corbyn’s readiness to overturn the UK’s planned exit from the EU if he becomes prime minister. A majority of the shadow cabinet is preparing to campaign to Remain if Mr Corbyn delivers on his promise of a second referendum on the UK’s membership of the bloc. It comes as an analysis by the Tories claims that up to 10 of Labour’s major manifesto commitments, including the plan to nationalise BT’s broadband business, would fall foul of EU directives and laws.

Steve Barclay, the Brexit Secretary, said Labour’s manifesto showed an “alarming misunderstanding of EU laws, despite the fact most of their MPs want to remain in the bloc”.

The report claims Labour’s plans to create a state broadband service would breach EU rules on state aid – financial assistance to firms that could market competition.

Following legal advice, Labour is understood to believe the proposal would not amount to state aid. A Labour spokesman described the Conservatives’ claims as “groundless nonsense”.

Meanwhile, in a new report, the Institute of Economic Affairs says proposals to bring key utilities back under state control “ignore important lessons” from the post-war period. The study, Renationalisation: Back to the Future, warns that the potential costs of nationalisation are “huge”, and “most of the potential benefits could be achieved in other ways”. distort