In his Andrew Marr interview yesterday, when it was put to him that in ruling out nationalising the big six energy companies he was breaking a leadership election pledge to support “common ownership” of energy, Sir Keir Starmer insisted that nationalisation and common ownership were not the same thing. But he would not elaborate, or explain what kind of “common ownership” for energy he would favour.
In fact, Labour has produced a very good policy document on just this topic. But it was published in 2017, when Jeremy Corbyn was leader. It is here (pdf). It is probably not a particularly useful guide to Starmer’s thinking on this topic, but it does set out alternatives to old-style nationalisation, particularly cooperative ownership and municipal ownership.
Here is an extract from the key chapter.
There exists a wide array of alternative models of ownership that could, as indeed they do in various other parts of the world, prove of benefit to our economy. This section will outline a number of these, starting at the micro level (cooperatives), before discussing municipal and local-led ownership, and finally at the most macro level (that of national ownership). For each the report will consider their merits, existing examples, and what is required to expand or create them in Britain.
Taking back 'red wall' not enough to win election, says Labour thinktank
Currently Labour has just 199 MPs. Last night the Fabian Society, the Labour thinktank, published a report (pdf) looking at the seats the party would need to win to form a government. It has looked at the 150 seats that the party came closest to winning in 2019, saying that to win a majority of one, the party would need 123 gains.
The main message from the report is that just focusing on the “red wall” seats, the traditional Labour constituencies that fell to the Tories in 2019, is not enough. It says most of the 150 seats are not formerly loyal Labour seats, and that they are a diverse group.
The 150 target seats, by category Photograph: Fabian Society
It also says most of these target seats cover towns and villages, not cities. It says:
Ninety-five of the 125 constituencies are made up of towns (or sometimes villages), with many of these in the north, Midlands and Wales and usually not adjacent to core cities.
Luke Raikes, the Fabian Society’s research director and the report’s author, said:
This report shows not just the mountain that Labour has to climb, but the route it needs to take to succeed. Labour has an opportunity to recast its appeal to focus on towns in the country’s demographic ‘middle’. Reaching out to formerly loyal ‘red wall’ seats is necessary but not sufficient for Labour. The party needs to reconnect outside big cities in towns and villages of every shape and size.
Nandy proposes 'new foreign policy partnership with Europe'
Lisa Nandy, the shadow foreign secretary, finished her speech to the Labour conference a few minutes ago. Here are the key points.
Nandy said Labour wanted “a new foreign policy partnership with Europe to address our shared challenges, from climate change to Russia”.
She said Labour was launching “a new taskforce on illicit finance with the aim of making the UK the most inhospitable place in the world for dirty money and ill-gotten gains”.
She said Labour would legislate to place a duty on companies to eliminate forced labour from their supply chains. “We will end cotton imports from Xinjiang,” she said.
She said Labour would end arms sales to Saudia Arabia.
She said Labour would remain “a proud, fiercely internationalist party” despite Brexit. She went on:
We face challenges unlike any we’ve faced before.
Engaging with a Chinese government essential to progress on climate change while standing firm in defence of human rights, freedom and security.
A Russian state that uses chemical weapons on the streets of the UK.
A world where drones, cyber-attacks and disinformation can be deployed without consequence against innocent people on the other side of the world.
The Tories say we can turn our backs.
Conference, they are wrong.
Building walls is easy. Building bridges – in the world, in the country and let’s be honest, with each other – that’s the hard part.
She said a Labour government would push at the UN human rights council for a global treaty to end violence against women and girls.
Lisa Nandy speaking at the conference this morning. Photograph: Hannah McKay/Reuters
The Labour pledge to scrap business rates has received a warm welcome from the Federation of Small Businesses, and the Conservatives seem wary of saying it is a bad idea. In a statement released overnight, Oliver Dowden, the Tory co-chairman, just focused on the measures the government is already taking to help businesses, without saying anything negative about the Labour plan.
But, in a briefing note, the Conservatives point out that Paul Johnson, director of the Institute for Fiscal Studies, the public spending thinktank, criticised the notion that getting rid of business rates would help the high street in an article earlier this year. Johnson said scrapping business rates would not help shops in the long term because rents would just go up. He said:
So why wouldn’t cutting business rates help all that much in the long run if your aim is to preserve high street shopping? Surely if you reduce the costs to me of running my shop, I am more likely to stay in business. There’s the rub. While cutting business rates might reduce my costs in the short run, it won’t make much difference in the long run. I’m not only paying a business rates bill; I’m also paying rent to the owner of the shop and of the land on which it sits. Because there is only a limited amount of land for shops, especially in places such as central London where rents and business rates are highest, cutting business rates will largely simply lead to higher rents.
However, in the same article, Johnson did say that it would be better to base business rates on the value of land than on the rental value of property.
Labour to review tax breaks worth £170bn to see if they're still justified, Reeves says
There are two announcements in Rachel Reeves’ speech that were briefed overnight by Labour. She is announcing a plan to scrap business rates, funded temporarily by what will effectively be a £2.1bn windfall tax on tech firms, although Labour has not said what the ultimate replacement for business rates will be.
But she is also announcing a review of all government tax reliefs, worth £170bn in total. Reeves says:
We will look at every single tax break. If it doesn’t deliver for the taxpayer or for the economy then we will scrap it.
Labour will tax fairly, spend wisely, and get our economy firing on all cylinders.
In a briefing note released to journalists, Labour explained why it is doing this. Here is an extract.
The government spends over £170bn a year on tax reliefs – more than it does on the health service. While some help create jobs or promote important social policies, others are wasteful and inefficient.
There are some tax reliefs we would keep – such as the VAT exemption on food. There are other reliefs Labour would scrap – such as the tax breaks that private schools benefit from through their charitable status.
We would review the others to make sure public money is being well spent. The government does not even know how much all their reliefs cost. Our review will make sure money is not being wasted on tax reliefs that have little or no benefit.
In its most recent figures, HMRC reports there are over 1,000 tax reliefs in the UK. Of those that have been costed, the exchequer loses over £174bn per year. These are defined as those that are intended to help or encourage particular types of taxpayers, activities, or products for economic or social objectives.
HMRC has published cost details of 186 non-structural reliefs, but the remaining 153 are uncosted. That means they do not know the cost of the majority of tax reliefs that exist.
The public accounts committee looked at the system of tax reliefs in 2020 and found “tax reliefs have an enormous impact on tax revenue but it is far from clear whether they deliver the economic and social objectives many are supposed to support.”
The note also says that, when it considers which reliefs to keep and which to scrap, Labour would consider issues like whether they help create jobs, whether they reduce the cost of living and inequality and whether they improve the efficiency of the tax system.
Reeves says raising income tax 'not on our agenda'
Here are the main lines from Rachel Reeves’ various interviews this morning. I’ve taken the quotes from PA Media.
Reeves, the shadow chancellor, said the government was to blame for the current fuel shortages at petrol stations. She said:
Since last year I have been meeting and talking with the Road Haulage Association and hauliers about some of the problems coming down the line. The government ignored those problems, which is why we are now facing the situation where people go to the supermarkets and see shortages of goods on the shelves, and why they are queuing up at petrol stations and not being able to fill up their tank. That is not acceptable, this is an out-of-touch and complacent government.
She said most people “couldn’t care less” whether HGV drivers are British or foreign. The goverment has said it will allow an extra 5,000 visas for foreign drivers, but yesterday Keir Starmer said up to 100,000 foreign drivers may be needed.
She said Labour would take a “pragmatic” approach to nationalising services like energy. She said:
What matters is that essential services like gas and electricity are delivering for consumers, and we would look at that in the round. But I agree with Keir Starmer, this is not the moment to be looking at nationalising companies, we need to be focusing on the day-to-day bread-and-butter issues that are affecting people’s lives.
I have always believed that we should take a pragmatic approach, that we should look at what works for taxpayers and our economy.
Where that means common ownership – for example, some of the rail services have come into public ownership – that is the right thing to do.
But I would always take a pragmatic approach: what is good value for taxpayers and what is good for our economy?
She said raising income tax was not on Labour’s agenda. She said:
Keir and I are both very clear, we have no plans to increase income tax and neither of us want to increase income tax, it is not on our agenda.
The only people who are increasing taxes for working people are the Tories with their jobs tax that comes in next year that hits ordinary working families and struggling businesses.
She said Labour wanted “those with the broadest shoulders” (ie, the wealthy) to pay more in tax.
She said she would not have called the Tories scum, although she could understand why Angela Rayner felt angry about them.
She said she objected to the debate about trans issues being reduced to a question about whether only women have a cervix. Asked this, she told LBC:
I just think that this issue has just become so divisive and toxic, and it pits people against each other – both groups who have faced discrimination in society – women and trans women. I just find this debate incredibly unhelpful and unproductive, to be totally honest.
Pressed on whether it was transphobic to say only women have a cervix, Reeves replied: “I don’t even know how to start answering these questions.” When asked the question again, she replied: “I wouldn’t say that. If somebody identifies as a woman or a man, they should be able to do so whatever their body parts are.”
This is from LBC’s Matthew Thompson.
“Is it transphobic to say that only women have a cervix?” A yes or no question you might think.
This morning the Today programme also broadcast an interview with Jeremy Corbyn recorded yesterday. Asked if he agreed with John McDonnell when he said the current Labour leader was acting like a Blairite tribute band, Corbyn made it clear he did. He replied:
Well, John has a way with words, he really does. I admire him. And I love the way he described the essay written by our leader as the Sermon on the Mount written by a focus group.
And asked if Angela Rayner was right to describe the Tories as scum, he replied:
She has a way with words and she’s right to be really strong in opposing what this government has done. I am alarmed at the levels of poverty and inequality in our society, and I’m horrified at the way in which racist attitudes are promoted against refugees and asylum seekers. History is not going to judge well in 50 years’, 100 years’ time, those that turned desperate refugees away.
The voting figures published by Labour show that Sir Keir Starmer only won the vote on the party leadership election rule changes with union backing. In some respects that is a reversion to Labour’s past, when the leadership regularly used to rely on rightwing unions to outvote leftwing activists, although that is not a description of how the party is generally operating at the moment.
In the card vote on this rule change, the constituency Labour parties (CLPs) were 52.86% against and 47.14% in favour. But the affiliates (mostly the unions) were 60.2% in favour, and 39.8% against.
The EHRC-related rule changes were passed by 73.64% to 26.36%. There were significant majorities in favour amongst both the CLPs and the affiliates, but the CLPs were less supportive. Only 17.47% of affiliates opposed the changes,, but 35.26% of the CLPs did.
Mandelson says leadership election rule change will keep out another Corbyn
Good morning. Sir Keir Starmer won the vote last night on the internal Labour reforms that will require leadership candidates to have the backing of 20% of MPs, not 10%, stop registered supporters voting in leadership elections and make it harder for activists to trigger a reselection ballot in their local Labour MP. The changes were passed by 53.67% to 46.33%, which was closer than some expected, but it does go some way to compensating for Starmer’s failure to get the unions to back his plan to change the leadership election system more fundamentally (he wanted to return to the electoral college) and his allies are treating this as a significant victory.
In an interview for the Today programme this morning, Lord Mandelson, one of the main architects of New Labour and a Starmer supporter, was much more explict about what this might mean than Starmer himself, and his shadow ministers, have been. He said this was all about locking out another leader like Jeremy Corbyn. He said:
Jeremy Corbyn built on the rules that Ed Miliband introduced, which allowed hundreds of thousands of people to apply to vote for our future leader without actually caring about the Labour party, knowing about the Labour party and in many cases not even becoming a member of the Labour party.
That avalanche of people who were allowed in the Labour party to back one far-left candidates who they wanted to see elected leader will now no longer be allowed to happen ...
What these rule changes mean, and this is perhaps absolutely fundamental for people out in the country, when they’re asked to vote for Keir Starmer as their next prime minister, they can know with almost complete certainty that they’re not going to wake up one day and find Jeremy Corbyn there instead.
Today the focus at the conference will be on Rachel Reeves, the shadow chancellor, who will use her speech to announce plans to scrap business rates. Here is my colleague Jessica Elgot’s preview story.
Reeves has been doing a morning interview round, and I will post the highlights soon.
Here is the agenda for the day.
10.15am: Frances O’Grady, the TUC general secretary, speaks to conference.
10.15am: Lisa Nandy, the shadow foreign secretary, opens the international debate. At 11am John Healey, the shadow defence secretary, will wind it up.
11.15am: Jonathan Reynolds, the shadow work and pensions secretary, opens a debate on the economy.
12pm: Rachel Reeves, the shadow chancellor, delivers her keynote speech.
2.15pm: Mark Drakeford, the Welsh first minister, speaks to the conference.
2.45pm: Steve Reed, the shadow communities secretary, opens a local government debate. Sadiq Khan, the mayor of London, speaks at 2.50pm, Nick Forbes, leader of Newcastle city council and head of the Labour group on the Local Government Association, speaks at 3.50pm and Joanne Anderson, the mayor of Liverpool, speaks at 4.40pm.
4.45pm: Louise Haigh, the shadow Northern Ireland secretary, delivers a speech.
4.50pm: Andy Burnham, mayor of Greater Manchester, Tracy Brabin, mayor of West Yorkshire, and Dan Jarvis, mayor of South Yorkshire, take part in a panel discussion.
5.10pm: Anas Sarwar, the leader of the Scottish Labour party, delivers the final speech of the day.
I expect to be focusing just on Labour today. For the latest in the fuel shortage crisis, do read my colleague Graeme Wearden’s business live blog.
I try to monitor the comments below the line (BTL) but it is impossible to read them all. If you have a direct question, do include “Andrew” in it somewhere and I’m more likely to find it. I do try to answer questions, and if they are of general interest, I will post the question and reply above the line (ATL), although I can’t promise to do this for everyone.
If you want to attract my attention quickly, it is probably better to use Twitter. I’m on @AndrewSparrow.
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