John McDonnell has promised Labour will nationalise railways, water, energy and Royal Mail.
Speaking at the party’s annual conference in Brighton, the Shadow Chancellor promised to “take back” key public services that are currently run by private companies.
He said: “Ours will only become an economy for the many, if we significantly broaden ownership. That means supporting entrepreneurs, small businesses, the genuinely self-employed and massively expanding worker control and the co-operative sector.
“Building an economy for the many also means bringing ownership and control of the utilities and key services into the hands of people who use and work in them. Rail, water, energy, Royal Mail: we’re taking them back.”
Labour has previously called for public services to be brought back under state control but the bolder rhetoric used by Mr McDonnell reflects a new confidence among the party leadership and its supporters after they exceeded expectations in June’s General Election.
Labour is committed to leaving the European Union but would have different negotiating priorities to the Conservatives. It has said it would have a “strong emphasis” on staying in the single market and the customs union. German Chancellor Angela Merkel and leading figures in Brussels have been unambiguous that membership of the single market is impossible without free movement.
The party would drop “bogus immigration targets” but move to a managed system of migration favoured by many leave voters. It has said this “may include employer sponsorship, work permits, visa regulations or a tailored mix of all these”.
Labour’s manifesto commits to balance government spending with the amount raised by taxation, which can mean little more than significant tax increases. The greatest burden will fall on higher earners but they cannot meet demand on their own. It has also promised to bring rail companies back in to public ownership and cap fares. The party would also renationalise Royal Mail. It also promises a “transition” to publicly owned energy.
No one earning under £80,000 would pay any more in national insurance or income tax. It would raise corporation tax, from the current low of 19p to 26p. This higher rate would still be a competitive internationally, but the government is currently fighting hard to attract business in the wake of Brexit and they say a low corporation tax rate is crucial. Labour would also lower the top, 45p income tax threshold to £80,000. In theory, this could raise £7bn, but only if higher earnings did not decide to move abroad.
Labour has promised more money for GP services, free hospital parking for patients, staff and visitors, and to take a million people off NHS waiting lists by guaranteeing treatment within eighteen weeks. These promises will be expensive to keep, and there is no certainty that the party’ s commitment to raising taxes on higher earners, increasing capital gains tax and reversing cuts to corporation tax will be enough to meet the need.
The party has pledged to abolish university tuition fees and reintroduce maintenance grants and give free school meals to all schoolchildren.
Labour’s manifesto commits to building 1m new homes, and would introduce controls on rent rises for private renters. It would also scrap the so-called bedroom tax.
Labour would ban fracking, but, crucially, also supports new nuclear projects. It would also introduce a new Clean Air Act to deal with illegal air quality
Its manifesto says it is committed to the NATO target of 2 per cent spending on defence. It is also committed to the renewal of Trident, even though Jeremy Corbyn has spent a lifetime campaigning against it.
Labour’s 2017 manifesto committed the party to nationalise rail companies as their franchises expire, create a “publicly owned, decentralised energy system” and a network of regional publicly-owned water companies, and reverse the privatisation of Royal Mail “at the earliest opportunity”.
In Brighton, Mr McDonnell received a standing ovation from party activists after criticising what he called the UK’s “rentier economy, where wealth is secured not by what you produce, but by the amount of rent you can charge”.
He announced that Labour would bring existing Private Finance Initiative (PFI) contracts back under state control. The party has previously ruled out making any more PFI deals but has not, until now, said it would phase out existing contracts.
In a sign of some reconciliation between Labour’s warring tribes, Mr McDonnell also praised the New Labour governments for investing in public services.
He said: “In 1997, after 18 years of Thatcherism, when whole industries and communities across our country had been destroyed by the Torie,s and our public services were on their knees, it was the Blair/Brown Government that recognised and delivered the scale of public investment that a 21st century society needed.
“We should never forget that we are part of that great Labour tradition and we should be so proud of it.”Reuse content