Labour party’s plan to nationalise mail, rail and energy firms
Draft manifesto reveals vision of public ownership as part of Jeremy Corbyn’s ‘transformational programme’
Photo by Chatham House
Jeremy Corbyn will lay out plans to take parts of Britain’s energy industry back into public ownership alongside the railways and the Royal Mail in a radical manifesto that promises an annual injection of £6bn for the NHS and £1.6bn for social care.
A draft version of the document, drawn up by the leadership team and seen by the Guardian, pledges the phased abolition of tuition fees, a dramatic boost in finance for childcare, a review of sweeping cuts to universal credit and a promise to scrap the bedroom tax.
Party sources said Corbyn wants to promise a “transformational programme” with a package covering the NHS, education, housing and jobs as well as industrial intervention and sweeping nationalisation. But critics said the policies represented a shift back to the 1970s with the Conservatives describing it as a “total shambles” and a plan to “unleash chaos on Britain”.
Corbyn’s leaked blueprint, which is likely to trigger a fierce debate of Labour’s national executive committee and shadow cabinet at the so-called clause V meeting at noon on Thursday, also includes:
- Ordering councils to build 100,000 new council homes a year under a new Department for Housing.
- An immediate “emergency price cap” on energy bills to ensure that the average duel fuel household energy bill remains below £1,000 a year.
- Stopping planned increases to the pension age beyond 66.
- “Fair rules and reasonable management” on immigration with 1,000 extra border guards, alongside a promise not to “fan the flames of fear” but to recognise the benefits that migrants bring.
On the question of foreign policy, an area on which Corbyn has campaigned for decades, the draft document says it will be “guided by the values of peace, universal rights and international law”. However, Labour, which is facing Tory pressure over the question of national security, does include a commitment to spend 2% of GDP on defence.
The draft manifesto, which will only be finalised after it is agreed on Thursday, also makes clear that the party supports the renewal of Trident, despite Corbyn’s longstanding opposition to nuclear weapons.
An accompanying sentence to the policy – “any prime minister should be extremely cautious about ordering the use of weapons of mass destruction which would result in the indiscriminate killing of millions of innocent civilians” – has been removed from more recent versions, the Guardian understands.
After Corbyn generated controversy by saying he was “absolutely fine” with a second referendum being held in Scotland, the document makes clear Labour opposition to such a move. Instead, it says, the party will “campaign tirelessly to ensure that a desire to remain a part of the UK is respected”.
A section on Brexit states that Labour accepts the terms of the referendum result and will seek to unite the country around the deal. A trailed policy to rip up the Conservative’s white paper on the issue and replace it with a plan that emphasises the benefits of the single market and customs union is included – along with a pledge to unilaterally guarantee the rights of EU citizens and offer parliament a “meaningful vote” on the final agreement.
Other policies in a draft that could stir controversy include ruling out a “no deal” scenario on Brexit, only sending the armed forces to combat if “all other options have been exhausted” and a 20:1 pay ratio for companies with public sector contracts.
The manifesto claims that the policies will be fully costed as part of Labour’s fiscal credibility rule under which the shadow chancellor, John McDonnell, has promised to maintain an “iron discipline” in day-to-day spending. The money will be raised through tax rises for those earning over £80,000 – although full details of such a policy are not included – and a reversal of corporation and inheritance tax cuts.
However, the party is prepared to borrow £250bn to fund capital spending infrastructure and will promise to set up a national investment bank.
The plans for the energy market do not represent wholesale nationalisation but steps similar to those in Germany to break down the dominance of a handful of companies.
The draft manifesto promises a temporary emergency price cap “while we transition to a fairer system for bill payers”. It also promises to “take energy back into public ownership to deliver renewable energy, affordability for consumers, and democratic control”.
The changes would involve central government control of “the natural monopolies of the transmission and distribution grids” as well as for the policy functions of the regulator. And it would pave the way for at least one publicly owned energy company in every region of the UK.
On plans for the railways, Corbyn has previously argued that ongoing chaotic train delays are proof that “private transport operators cannot be trusted with having passengers’ best interests at heart”.
The draft policy also promises free wifi for rail passengers.
Corbyn’s drive towards the renationalisation of large sections of Britain’s public services will be a defining feature of the election, reminding voters of his leftwing roots campaigning against the sweeping privatisations of the 1980s Tory party. Theresa May is likely to strongly criticise the Labour leader’s radical pitch that some experts have warned could cost tens of billions of pounds, but is herself offering to be more interventionist than former Conservative leaders.
A Conservative spokesman said: “The commitments in this dossier will rack up tens of billions of extra borrowing for our families and will put Brexit negotiations at risk. Jobs will be lost, families will be hit and our economic security damaged for a generation if Jeremy Corbyn and the coalition of chaos are ever let anywhere near the keys to Downing Street.”
However, some in the Labour party may feel the plans do not go far enough, as they only promise a review of Conservative welfare cuts to universal credit and legal aid. The decision to limit tax credit and universal credit payments to the first two children in the family is also expected to be placed under review, while the so-called “rape clause” will be ended immediately.
Other policies range from creating a minister for England, lowering the voting age to 16, extending abortion rights to northern Ireland, rolling back on maternity discrimination and scrapping employment tribunal fees. There is an offer to insulate the homes and upgrade the boilers for disabled veterans.
A section on wildlife promises to keep the foxhunting ban, end the badger cull and support a ban on wild animals in circuses. In order to protect bees the party will promise to ban neonicotinoids, an insecticide that has led to a decline in population.
The draft manifesto will be scrutinised by Labour’s national executive committee and shadow cabinet from midday on Thursday at what is known as the clause V meeting.
The session, which also involves the heads of the national policy forums, will hammer down a final document that will be published next week.
There is likely to be an investigation into who may have leaked different versions of draft documents to parts of the media on the eve of the meeting. Strategists will be frustrated that their plans to announce policies on a day-by-day basis between now and early next week, when the official launch was due to take place, have been undermined. On Wednesday he was joined by the shadow education secretary, Angela Rayner, to announce plans for a national education service.
By reversing repeated cuts to the corporation tax rate made by the Tories since 2010, Labour believes it could fund a series of ambitious pledges, including restoring maintenance grants for the poorest students, guaranteeing that five, six and seven-year-olds will not be taught in classes of more than 30, and restoring the educational maintenance allowance, paid to 16 to 18-year-olds in full-time study.
The day became dominated by higher education after a video of McDonnell showed him telling activists about the plan to scrap tuition fees.
However, Rayner said she had wanted it to be focused on further education because that was so often neglected by politicians. “I’ve been deliberately trying not to talk about higher education today,” she said. “I’ve talked about my personal story [in further education] because many politicians have talked about parity of esteem, but they’ve not touched FE. Because they’ve not felt the transformative effect that FE has.
“When I was a mum at 16, I was made to feel that that’s it. There was nothing left for me. I’d failed at secondary school and there was no option for me to go back and to be good at anything. Whereas FE gave me the opportunity to get a vocational qualification in care and get back into the workforce.”
Labour’s election package will be built around Corbyn’s “10 pledges” from last year’s annual conference. That focused on infrastructure to help create “a million good quality jobs”, a promise to build half a million council homes, getting rid of zero-hours contracts, ending privatisation in the NHS and funding social care, the national education service, more focus on climate change, renationalisation and a more progressive tax system.
This article originally appeared in The Guardian.