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Labour or Tory – Who’s Credible?

20th May 2017

Labour/Tory – Costing and Credibility

Labour’s 2017 Election Manifesto has been widely welcomed. It can fairly said that it contains something for pretty well everyone. The pledges in ‘For the Many, Not the Few’ are carefully costed. They come to £48.6bn The 128 page Manifesto is accompanied by an 8 page documented called ‘Funding Britain’s Future’ (link below), fully referenced. This document costs every single item in the Manifesto. The total cost is £48.6bn. The figures add up. Labour showed that 95% of the population would not pay an extra penny. Only the rich would contribute a little more.

Immediately the Tories and their press hirelings started banging the drum about Labour bankrupting Britain. Unnamed ‘experts’ were adduced in the Tory press to rubbish Labour’s arithmetic, saying the reforms will cost more money. The ‘Daily Mail’ contented itself with vague assertions that the programme will cost more than Labour claims – with no proof. The ‘Sun’ went further, declaring that it would lead to £30bn more borrowing. Not a shred of evidence was presented to prove this point.

What the Tories seem to have homed in on were the proposals for nationalisation and for investment in the Manifesto. We are told that Labour proposes to take over the railways, energy and water. All these proposals are very popular, including among Tory voters. It is widely recognised that the privatised utilities have run amok, ripping off consumers and garnering monopoly profits.  Actually complete nationalisation is not on the table.

Labour proposes to take over the franchises of the Train Operating Companies as they expire. What is the cost to the taxpayer? Zilch, nothing, not a sausage. This is what happened after private owners National Express walked away from the London to Edinburgh franchise. The publicly owned East Coast franchise then took over and delivered £1bn back to taxpayers. The Tories couldn’t abide this. They gave the franchise to Virgin and Stagecoach, so the rip-offs could resume.

As for the proposals on energy, the Manifesto is much more cautious in its proposals. Having made the points about millions living in fuel poverty thanks to privatisation of gas and electricity the Manifesto begins, Labour will:
“Regain control of energy supply networks through the alteration of operator license conditions, and transition to a publicly owned, decentralised energy system.”
Labour goes on to propose:
“Supporting the creation of publicly owned, locally accountable energy companies and co-operatives to rival existing private energy suppliers.”

Now, whatever you think of that, it’s not exactly a call to storm the Winter Palace. It’s a cautious, conditional approach to a real problem, in what even Theresa May has described as a ‘broken’ market.

Similarly with the supply of water, life’s prime want, and the postal service, publicly owned since 1516. Labour pledges to:
• “Replace our dysfunctional water system with a network of regional publicly-owned water companies.
• Reverse the privatisation of Royal Mail at the earliest opportunity.”

None of this is to happen on day one of a Labour government. Yet presumably these tentative proposals are what cause Tory reps to shriek about a £58bn tax black hole in Labour’s Manifesto. Where do they get the £58bn figure from? They don’t say. They made it up.

The figure first made the light of day in a car crash interview Chancellor Philip Hammond had on the ‘Today’ radio programme on May 17th.  He was asked how much theHS2 rail programme would cost. His guess, for that is what it was, was 63% out. This is a bit of a worry, as Hammond is supposed to be running the economy and the HS2 project. Then he unleashed the £58bn scare story. Jon Humphreys reminded Hammond that he was confusing and mixing up current and capital spending. Again this is even more of a worry as this bloke is also supposed to be an accountant. His goofs would shame an Accounts Clerk in their first week at college.

Labour is committed to subsidise all current spending from current taxation. That is clearly set out in ‘Funding Britain’s Future’: “Labour will therefore set the target of eliminating the government’s deficit on day-to-day spending within five years.” So Labour will eventually pay down the deficit in government spending they will have inherited from the Tories.

Labour will borrow to invest. Even the International Monetary Fund thinks the present government is bonkers for not investing in capital items which will make Britain richer in the future now that interest rates are effectively negative. This is free money, and that is exactly what Labour is proposing to do.

When the Tories launched their manifesto, there was no accompanying booklet like ‘Funding Britain’s Future’. Nothing has been costed. John McDonnel l reckons there are 60 uncosted promises in their manifesto. This is pathetic, an insult to the electorate.

The worst example of this is probably the Tory proposals for the ‘reform’ of social care. The National Pensioners’ Convention calls the proposals, a ‘Frankenstein’s monster’ of bolted-together bad policies that will damage pensioners and place an unfair burden on their families. The NPF representative explained:
“Over 500,000 people receive care at home at the moment. Under the current system, the value of their property is not taken into account, just their income and savings, but under the new Tory plan the property value will count too… Now everyone who owns a property will pay in full. That’s a huge change and it will affect a significant proportion of those 500,000 people - at least half, so a minimum of 250,000 older people.”

Most homes in the UK in 2017 cost far more than the £100,000 threshold, so homes will have to go to pay care bills. The NPF knows about these things, and it is worried. By contrast the Tory press is lying to pensioners about the effect the proposed changes will have on them.

The ‘Daily Express’ rushes to reassure pensioners about the Tory proposals, calling them ‘fairer’. This from a paper whose commitment to telling the truth ha run to headlines like ‘Diana: MI6 had tunnel murder plan, says spy’. Likewise the ‘Daily Mail’ headlines ‘You Won’t Have to Sell Home to Pay for Care’, the direct opposite of the truth.

As part of their triple whammy against pensioners, along with abolishing the triple lock, the Tories propose to get rid of the universal winter fuel allowance. Who will still get it in a means tested system? They can’t or won’t say. One proposal is that only the poorest pensioners entitled to pension credit will receive the winter fuel allowance. The trouble with this is that one million pensioners on less than £160 for a single person don’t claim pension credit? Why not? Have you seen the length of the form they have to fill in? That shows in a nutshell why universal benefits work and means testing deprives people of what they’re entitled to.

The Tory proposals are dishonest and shot through with holes. Labour’s reforms are carefully costed and credible.

As John McDonnell commented, “She’s having a blank cheque. You would not let someone go off to the supermarket with a blank cheque, take things off the shelves and not tell you how much they’re going to pay for.”

Labour’s costings in full are here