General Election 2019: Labour’s household finances pledge savaged
Labour’s pledge to save households more than £6,700 each year has been savaged by commentators and industry experts who question the party’s figures and assumptions about privatisation.
John McDonnell told supporters in Birmingham that those warning about the risks of Labour’s plans to nationalise energy, broadband, water and other industries claiming that “the privatisation fat-cats are scaremongering with their threats of legal action.”
He added: “Of course they need paying for. But we believe in a fair society, we don’t leave them to the market so those with the most can afford them while others can’t.”
However Labour’s plan was called out by one former party adviser Tom Hamilton, who said: “Anyone who tells you Labour will put £6,717 in your pocket is lying to you, it’s as simple as that.”
Robert Colville, director of the Centre for Policy Studies think tank, slammed Labour’s figures as “a naked deceit”.
Colville dismantled several of Labour’s promises, and pointed to the inconsistencies in their assumptions of an ‘average’ household.
“This is a ‘household’ in which two working parents are rich enough to both commute into London (or another big city), to pay for their own NHS prescriptions, and receive zero state help with childcare,” he said. “Yet at the same time poor enough to still be receiving free school meals, and renting their home – and, according to the final paragraph, earning the minimum wage.”
Colville also rubbished Labour’s use of nominal inflation figures while complaining that wages have not risen in real terms “is batsh*t”.
Paul Johnson, director of the Institute for Fiscal Studies, agreed. “There is no sense that this is an average person,” he told CityAM “This is a carefully constructed person, of whom there are very few in the country.
“There probably isn’t a family in the land who would get all the things they are talking about.”
Johnson also attacked Labour for what he described as “clearly just a made up number” on energy savings, and noted that whatever happened: “Someone is going to have to pay for it… Labour’s taxes are progressive, but it’s just absurd to suggest this can all be paid for by the top five per cent.”
Water UK chief executive Michael Roberts attacked what he called Labour’s “fantasy figures”, which he said ignored inflation.
“On average, customers have seen water bills going down in real terms for the last 10 years, and they will keep going down over the next five years. And according to Ofwat, bills in England and Wales are £120 lower than they would have been without privatisation and regulation.
“It’s also completely untrue to state, as the Labour document does, that ‘privatisation has not meant more investment’. Investment doubled in the decade following privatisation compared to the previous ten years when the industry was in government hands, and companies have now invested around £160 billion in making our water and sewerage service one of the best in the world.”
Main image: Getty