The Tories have condemned Labour’s plans as “eye-watering”, “wild”, “reckless”, “unaffordable” and set to “bankrupt the country”, with much of the press singing in tune.
Just after Labour’s 2017 election manifesto came out, Solidarity estimated that its proposals would “take some tens of billions of pounds — John McDonnell estimates £50-odd billion — out of the £1,000 billion a year which currently goes to the rich and the very well-off, or to enterprises under their control”.
The 2019 manifesto isn’t out until Thursday 21 November, but the indications are it will be a similar document to 2017 in terms of social spending. Some of Labour’s high-profile plans, for instance on broadband and climate change, as well as on public services, are focused around capital spending rather than year-to-year spending on services themselves.
McDonnell summarises the plans as a promise to “tax the rich to pay for things everyone needs” and “use the power of the state to invest to grow our economy, create good jobs in every region and nation and tackle the climate emergency.” Very welcome after the Blair and Tory years, but begging the question of whether capitalism can really be transformed into “our” economy without taking ownership and control away from the profiteer class.
The Tories feel vulnerable on the NHS, but really they are only recycling an announcement from Theresa May that funding for NHS services go up an average of 3.4% a year over the next five years, perhaps enough for the health service to stand still after years of real-terms cuts.
In addition to more money for NHS capital spending, training and education and public health promotion, Labour is promising an extra £6bn a year on NHS services, a rise of 3.9% a year – about the average between 1955 and 2019, but much less than the 6% a year under New Labour.
Under the Blairites, a growing chunk of the money disappeared into PFI payments and the profits of private companies taking over NHS services. That process has accelerated since the start of the Tory-Lib-Dem coalition in 2010, and despite assertions that “the NHS is not for sale” the Tories plan to continue it.
Despite its anti-privatisation rhetoric and pressure from NHS campaigners, Labour remains vague on reversing privatisation, but is committed to repeal the Tory-Lib-Dem 2012 Health and Social Care Act which is the current charter for increased marketisation.
Labour has also promised £6bn to fund free social care for over 65s – but, unfortunately, not for everyone – and nodded towards encouraging “direct provision” by local authorities, but remains unclear on that too. Following their fiasco over the issue in 2017, the Tories are currently very quiet on the subject.
Without increased national spending on social care, local government faces further disaster, as social care will make up a rapidly growing proportion of council budgets. Councils have borne a heavy brunt of the cuts since 2010, losing more than half of their central government funding, and under the Tories there is more to come. In the summer one in five councils said they were on the verge of bankruptcy, while another third said that within three years they would be unable to meet their legal obligations to provide adult social care and child protection.
The record of Labour councils in resisting these attacks has been terrible – passive and defeatist and sometimes worse – but in fact the mostly right-wing dominated Labour councils have set out a clear position for the election than the party’s more left-wing leadership. 120 Labour council leaders and mayors have written to the party calling for a pledge to reverse all cuts within the life of one Parliament.
Labour’s local government spokesperson Andrew Gwynne has responded positively to their call for emergency increases in funding but evades the central demand to reverse all cuts. He says nothing about restoring council’s powers and autonomy either. However, the difference between even this evasion and the Tories is huge.
The Tories are cynically trumpeting an increase in school funding by £7.1bn over three years – but at best this will make up the 8% real-terms fall in per-pupil funding they have imposed over the last decade (£6,537 per-pupil in England in 2009 to £5,994 in 2018). Labour will cut class sizes and give free meals to all primary school children. To its promises to scrap university tuition fees and restore student grants and the Education Maintenance Allowance, it has added a pledge to provide every individual with six free years of adult learning. That is a very important break from the drastic rundown of adult education under the Tories (and Lib-Dems) since 2010.
Labour is also promising to scrap primary school SATS, stop the creation of academies and free schools and open the door to returning schools to council control. There is speculation Labour may go further towards its conference policies of reversing academisation and at least restricting private schools. It is also promising to open 1,000 Sure Start centres.
Next year the Tories promise to end the freeze on the level of benefits – I.e. yearly real-terms cuts – they introduced in 2016. This policy has cost the poorest seven million families in the UK something like £550 a year each on average, and an increase next year, even if above inflation, will not undo the damage of a 6% real cut in income, let alone increase living standards. The Tories do not plan to remove the limit on benefits to only two children, or the cap on overall amount of benefits that can be claimed, policies which have been equally damaging.
Labour has promised changes in the opposite direction, replacing the current system of Universal Credit into which the Tories are merging most benefits.
This includes reducing and phasing out delays for the first UC payment and scrapping the two-child limit and the overall cap. Labour will also scrap the “bedroom tax” rule reducing housing benefit for council or housing association tenants with a spare room or rooms and abolish the “sanctions” regime which has increasingly functioned to bully and impoverish claimants.
The £3bn Labour is promising to invest in welfare is only a fraction of what has been stripped out from benefits over many years. Labour argues it will save more money by boosting jobs and living standards and so reducing the need for benefits in various ways.
On housing, the Tories’ policy appears to amount to encouraging more private sector house-building – as if the issue was lack of building, rather than lack of quality and really affordable homes. The failure of the market to provide for housing needs is shown by the government’s failure to get a single one (!) of its 200,000 projected “starter homes” for first time buyers under 40 built. One goal it is achieving is running down the UK’s council housing stock.
Labour has now committed to abolishing the “right to buy” policy which has helped run down the council housing stock. It has also promised a significant council house-building program. Having promised three-year tenancies in 2017, the party is now committed to “indefinite” tenancies for private renters. The rest is still unclear.
Labour is also promising an increase in free childcare hours (though still quite limited and still provided through the private sector) and free travel for under 25s.
Labour promises a £10 legally-mandated minimum wage by next year – without lower youth rates (it’s not clear if occupation exemptions will also scrapped or narrowed). That would represent the biggest ever increase in the National Minimum Wage and give the UK one of the highest minimum wages in the world, measured against median hourly earnings. The Tories are also promising some increase.
On all historical experience, a strong trade union movement is necessary to make sure Labour promises are stuck to and not nullified by pushback from capitalists.
The Tories will keep all anti-union laws and want a further decline in the strength of workers’ organisation.
Labour is committed to reintroducing and expanding collective bargaining between employers and unions across the economy, to drive up wages and conditions and strengthen unions. It will scrap the 2016 Trade Union Act, which further limited workers’ and unions’ right to organise industrial action. It implies various other changes to make industrial action easier, for instance allowing workplace as well as postal balloting for strikes. Labour conference policy is for repeal of all the laws from Thatcher’s time outlawing solidarity strikes, political strikes, quick-response strikes and effective picketing, but the signs are that the manifesto will leave that out.
Labour proposes new higher tax rates of 45% for those on over £80,000 a year and 50% over £123,000 – both lower than the top tax rate under Thatcher. And to restore corporation tax to 26pc, lower than it was throughout the New Labour governments and much lower than it was under Thatcher.
We will see what’s in the Labour manifesto, but what we said in 2017 surely remains relevant:
“The proposed clawback from the rich is moderate. In simple arithmetic, they could afford it easily – some tens of billions out of hundreds of billions of value which they siphon away each year. But the rich do not get rich, in a capitalist society, by being generous and easy. They get rich by being the people most ruthless in pursuit of greed, exploitation, trampling down and squeezing the working class.
“What they say now, while they are still confident of a Tory victory, about Labour’s policies being ‘wild’, ‘ruinous’, ‘disastrous’, and ‘illegal’, is a pale anticipation of how they will react if Labour wins. They have a hundred levers of sabotage of an elected government — from ‘strikes’ of capital, through top officials, to the Labour right — and they will use them.
“Even the moderate rebalancing proposed by Labour’s manifesto can be implemented thoroughly and securely only by a labour movement ready and willing to take economic power out of the hands of the ultra-rich, by workers’ control and social ownership across industry.
“The movement will become strong enough to do that only by uniting, now, to create and organisation in every workplace and working-class street capable of winning a majority for the manifesto and fighting the battles needed to implement it.”