Consultation Papers for Manifesto
- 1 Consultation Documents
- 2 Funding Britain's Future
- 3 Tax Transparency Programme
- 4 Fiscal Credibility Rule
- 5 Alternative Models of Ownership
- 6 Labour's Industrial Strategy
- 7 A National Investment Bank for Britain
Want to know more about our plan for a better, fairer Britain? Explore the additional resources below. These documents provide background and costing for the manifesto.
Funding Britain's Future
This short document shows how Labour will make the taxation and spending decisions in government that will transform and rebuild our country. After seven years of Conservative failure, we need to break with the past. Investment by businesses is falling. Wages are lower today than they were ten years ago. Under the Conservatives, Britain has become the only major developed economy where wages have fallen, even when the economy has grown. Our public services have been driven into crisis, even as this government has slashed taxes for the rich. Our National Health Service is under severe strain. Our schools are under-funded. One million vulnerable elderly people are going without the care they need. And yet this is a country with huge potential. We live in the fifth richest economy on the planet, but that wealth is held in the hands of the few. Too many are in low-paid, insecure work. Too many worry our children will not have the same opportunities we enjoyed. We can do so much better than this. We are being held back by the failures, not only of this Tory government, but of a system rigged for the benefit of the richest. It doesn’t have to be like this. We could all be living richer lives if we had an economy that worked for the great majority. That is what Labour aims to achieve. In this pamphlet we publish the costs and funding sources, and reference the research and calculations for each policy proposal. Every spending commitment is fully costed. Every source of funding is explained.
Labour is setting out our plans in detail because we are confident that, when they are presented before the people of Britain, they will show how a Labour government can transform the country. This is the most comprehensive costing exercise, provided by any political party, at an election in recent times. It is published to allow informed scrutiny and debate in this election campaign. Every spending commitment we make today will be overseen in government by an independent Office for Budget Responsibility. We give a cast-iron guarantee not to raise National Insurance contributions or VAT, and not to raise income taxes for 95 per cent of the workforce. We ask only that those at the top pay their fair share. By creating a fairer system of taxation, tackling tax evasion and avoidance, and encouraging a fairer tax system, we are able to rebuild our NHS, social care, education and other services. Labour’s programme is aimed at transforming our society. It is ambitious for this country, the scale of investment in our public services and our economy matches that ambition. We present here the foundations of a country built for the many not the few.
Rt Hon John McDonnell Shadow Chancellor of the Exchequer
Download for more information about our funding plan, or alternatively you can view on screen.
Tax Transparency Programme
Labour’s Tax Transparency and Enforcement Programme will be the most comprehensive effort ever made by any UK government to end the social scourge of tax avoidance and ensure that those super-rich individuals and minority of giant corporations seeking to duck their responsibilities to society will pay their fair share. By its nature, tax avoidance is difficult to quantify. Estimates of the wealth hoarded globally in tax havens range from $4-$20 trillion. Even HMRC estimates that the tax gap”, some of which is due to tax avoidance and evasion, comes to £36 billion.
- To meet the scale of avoidance, we will reverse the cuts at HMRC, restoring staffing numbers with an additional £200 million of funding, which will enable HMRC to properly investigate avoidance and bring in more revenue.
- Under a Labour government committed to closing the loopholes and ending tax avoidance through our Tax Transparency and Enforcement Programme, we are confident that at least an additional £6.5-8.5 billion a year can be raised.
Download for more information on our tax transparency and enforcement programme or alternatively you can view on screen.
Follow the link to see Labour's manifesto commitments on Taxation
Fiscal Credibility Rule
- Labour will close the deficit on day-to-day spending over five years
- Labour make sure government debt is falling at the end of five years
- Labour will borrow only to invest
- When the Monetary Policy Committee decides that monetary policy cannot operate (the “zero-lower bound”), the Rule as a whole is suspended so that fiscal policy can support the economy. Only the MPC can make this decision.
- In addition, we will legislate so Office for Budget Responsibility reports to Parliament, not Treasury.
Download for more information on our fiscal credibility rule or alternatively you can view on screen.
Alternative Models of Ownership
- The economic system in Britain, in its current guise, has a number of fundamental structural flaws that undermine economic strength and societal well-being. The predominance of private property ownership has led to a lack of long-term investment and declining rates of productivity, undermined democracy, left regions of the country economically forgotten, and contributed to increasing levels inequality and financial insecurity. Alternative forms of ownership can fundamentally address these problems.
- These issues are all the more pronounced given the increasing levels of automation in our economy. Automation has an emancipatory potential for the country’s population, but the liberating possibilities of automation can only be realised – and the threats of increased unemployment and domination of capital over labour only countered – through new models of collective ownership that ensure that the prospective benefits of automation are widely shared and democratically governed.
- Cooperative ownership has the ability to increase employment stability and increase productivity levels, as well as making firms more democratic. To support the expansion of cooperatives in the UK it is necessary to improve their access to finance, and examples from Italy and Spain point in the direction necessary to achieve this. Cooperatives can further be supported by national legislation and a re-worked government procurement policy.
- Municipal and locally-led ownership can improve service provision and guarantee that economic prosperity is not concentrated in certain regions of the country. A variety of policies, including place-based budgets, increased powers being handed to local authorities, and the relocation of various major institutions outside of London can foster this type of ownership.
- National ownership of certain industries promotes long-term planning of the economy, helps to provide modernising infrastructure, quality health and social care, and to combat climate change. Examples around the world point to the positive contribution of national ownership, but in the UK national state ownership has historically tended to be too centralised, with power in the hands of a private and corporate elite. To improve national ownership in the UK requires taking measures to increase the democratic accountability of state ownership.
- To turn the proposals of this report into practical and popular policy will necessitate, amongst other things: the examination of sectors of the economy which may require national government intervention; the drawing up of a list of policies to develop and to have an open consultation with stakeholders on the biggest proposals; the establishment of a network of activists/experts to discuss governance issues in collectively/publicly owned organisations; and the preparation of a policy document for publication ahead of the September Party conference.
Download more information about our plan for alternative models of ownership or alternatively you can view on screen.
Labour's Industrial Strategy
For decades, policy-makers have assumed that the best way to secure a successful economy is to leave the market to its own devices. This approach helped lead to periods of growth, most notably in the early 2000s. But it has also allowed long-term economic problems to accumulate. Inequality has ballooned as the economy has shifted towards low-paid, insecure jobs. A decline in Britain’s manufacturing base and our over-reliance on the financial sector, centred around London and the South-East, have created vast regional and sectoral imbalances. While the South-East struggles with a rising cost of living crisis, post-industrial northern and coastal towns have seen their economies and communities held back. We have also seen the current account, productivity growth, wage growth and investment all deteriorate, while Britain’s spending on research and development is more than a quarter below the OECD average.
Download our report on Labour's Industrial Strategy or alternatively you can view on screen.
A National Investment Bank for Britain
In July 2016, John McDonnell MP, Shadow Chancellor of the Exchequer, announced Labour’s support for a National Investment Bank (NIB) and network of regional development banks (RDBs) as part of Labour’s pledge to rebuild and transform Britain. The NIB and RDBs form part of Labour's promise to mobilise £500bn of investment over ten years to redress many of the structural problems in the British economy, a figure which includes both public sector and private sector financing. The existing financial system has proven inadequate for the purposes of much of the UK economy: in addition to widespread criticisms of short-termism and a failure to invest in the economy for the long term with investment disappointing by international comparisons, wide disparities have emerged between our regions and nations.
The idea of a National Investment Bank is not a new one, nor one without international precedents. Different forms of state-backed banks already exist in many countries and sub-regions, including Germany, Canada and North Dakota, and a British counterpart should be able to learn from best practice elsewhere in the world.It should be noted that the NIB and RDBs are not designed to be an alternative to public spending commitments through normal department spending limits, whether on revenue or capital accounts. The July 2016 speech by John McDonnell referred to a programme of public capital expenditure, averaging £25bn per year over ten years, as part of what is needed to address the shortfall in infrastructure spending, and the £250bn lending target of the NIB and RDBs is in addition to this.
Since then it should be noted that the incoming Chancellor of the Exchequer, Philip Hammond MP, has implicitly conceded the need for greater public investment, while refusing to take it seriously, with a token increase in capital expenditure of £27 billion over the next five years.
The aims of this working group are to consider some of the important questions about the implementation of the National Investment Bank: how it relates to our industrial strategy, how it is funded and structured, what should be its aims and structures, and how Labour should go about its implementation.The contents of the report are the conclusions of the group overall, not always unanimous, and so should not be taken to represent the views of any single member of the working group.
Download more information on our plan for a National Investment Bank for Britain or alternatively you can view on screen.