Labour is promising to invest £150bn in public services in an “irreversible shift” of power to working people if the party wins the December general election.
In a speech in Liverpool today, Labour shadow chancellor John McDonnell promised to “shift the centre of political gravity” by moving Treasury staff out of London in order to ensure all regions benefit from the investment.
Meanwhile, Tory counterpart Sajid Javid dismissed Labour’s plans as “fantasy economics”, during a rival address in Manchester.
The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
SUBSCRIBE & SAVE
Sign up for The Week's Free Newsletters
Join more than 350,000 subscribers and keep yourself informed with a selection of The Week’s most interesting, enlightening and entertaining stories - plus daily puzzles.
Join more than 350,000 subscribers and keep yourself informed with a selection of The Week’s most interesting, enlightening and entertaining stories - plus daily puzzles.
Latest Videos FromThe Week
McDonnell and Jeremy Corbyn are “like the anti-vaxxers of economic policy”, the chancellor was expected to say, in what The Guardian describes as a sign of the “Tories’ determination to attack Labour on the economy relentlessly over the next five weeks”.
So what are Labour’s economic plans?
McDonnell announced extra money for schools, hospitals, care homes and housing, “on top of existing spending plans to be paid for through borrowing”, says the BBC.
Labour will carry out “investment on a scale never seen before in this country and certainly never seen before in the North and outside of London and the Southeast”, he said, adding: “Power is coming home, back to the people.”
The party is planning to add £100bn of new spending to the £50bn social transformation fund that Labour pledged in 2017.
The combined total will be spent over five years to “repair the social fabric that the Tories have torn apart”, McDonnell said.
Labour has also promised a £250bn green transformation fund to be spent over ten years, in a fresh bid to tackle the climate crisis.
Together, the two pots of money will “deal with the human emergency which the Tories have created, alongside the climate emergency”, according to McDonnell.
Labour has not yet spelled out how it will pay for its policy pledges, but has promised to publish a separate costings document, as it did in 2017.
Earlier this week, the head of the civil service, Sir Mark Sedwill, blocked a Conservative plan to use civil servants to cost Labour’s economic plan. Labour had complained about the “ethics and propriety” of using civil servants for the work in the run-up to the election.
And the Tory plan?
Javid hailed “the end of austerity” when revealing the Government’s spending plans in September.
The chancellor pledged to increase public spending by £13.8bn as part of a one-year spending review, with more money for police, hospitals, and local government.
Since then, Boris Johnson has made an increasing number of dramatic economic pledges.
The prime minister has promised to invest not only in the NHS, but also in digital infrastructure and the transport system in an attempt to stimulate economic growth - and win votes.
NHS trusts will receive £13bn to build and develop hospitals, from a total of £33.9bn that the Government expects to spend on the NHS by 2023.
The Tories have also earmarked £25bn to develop the country’s road network over the next five years; £5bn for broadband; £220m for transport; and a £750m increase in Home Office spending.
Councils will receive £1.5bn for social care, while an additional £432m will go towards tackling climate change.
Spending on schools will increase over three years by £7.1bn, and Javid has promised an extra £2.2bn next year for defence.
On the campaign trail today, the chancellor pledged to invest in education, technology and infrastructure, to help “unleash Britain’s potential”.
But he argued that delivering Brexit is the most important thing for the economy.
“Jeremy Corbyn’s Labour would damage our economy by wasting 2020 having another two referendums on EU membership and Scottish independence - leaving business facing even more uncertainty,” Javid said.
