Labour Manifesto: An Edelman Briefing

GENERAL ELECTION EDELMAN 16 May 2017

Rob Newman Account Director

A former Labour Party adviser who spent more than a decade with front- and backbench Members of Parliament, in constituencies and in London, through spells in power and in opposition, Rob is an Account Director in the Edelman Public Affairs team. A former political adviser and press spokesman, Rob was a policy and briefing officer for the entire Parliamentary Labour Party and was part of the secretariat to the Shadow Cabinet. He is an expert in Commons procedure – an essential skill as the new Parliament prepare to deal with the legislative onslaught of Brexit.

THE LABOUR MANIFESTO Jeremy Corbyn has styled the choice at this election as one between hope and fear - with the Conservatives obviously cast in the role of villain. But in seeking to convince the country of his vision of a left-wing utopia, Mr Corbyn isn't above a little fear-mongering of his own.

Labour's manifesto, published today, conjures up the demons who stalk the land: the spectres of debt, cuts, austerity, falling pay and frustrated ambition. Should Theresa May return to Downing Street, the NHS will no longer exist and the country will mutate into a “bargain basement tax haven”.

Of course, political parties all exaggerate for effect - well, usually. One of the big questions of this election is whether the Conservatives really are stretching it when they warn that the Labour Party has gone off the reservation and that Mr Corbyn has dragged the party of Blair and Brown to the extremes. This manifesto should answer that question. Is it a reprise of 1983, the so-called “longest suicide note in history”? Or is it a prospectus that defies pigeon holing as the document that the left wing always wanted to see?

On the former, we will find out on June 8th. But on the latter, we have some answers. This is very much Jeremy Corbyn's manifesto. Other than Trident - where the leadership has had to bend to the will of the party (i.e. the unions) - this is the biggest break with the Labour Party’s policy direction in twenty years. It is clear that, sink or swim, Mr Corbyn will have to own - or will be made to own - the General Election result.

16 May 2017

Despite what those who have joined Labour to support Corbyn since 2015 often tell us, Labour has always been “for the many” - from the days of New Labour to the Attlee Government post-1945. The difference has been in how Labour has applied those values in terms of policy. And when it comes to policy, this manifesto ticks all the boxes for the Left of the party. Do away with some of the hated bits of the Blair years: check (scrap tuition fees, attack “aggressive wars of intervention”). Nationalise some of the commanding heights of the economy: check (Royal Mail, the railways, the water industry, energy companies).

Oppose privatisation: check (reversing its effects and role in the NHS). And tax, tax, tax: lower the 45p rate. Bring in a 50p rate. A financial transaction tax. A payroll tax.

Corporation tax rises. Almost £50 billion in tax rises in all which neatly covers almost exactly the stated cost of the party’s manifesto pledges ... except for the bits which will be dealt with out of “capital spend” and extra borrowing.

In his speech today, Mr Corbyn cited Harold Wilson, who he said “had a vision for Britain and created the institutions to match”. In his speech to Labour Party Conference in 1975, Harold Wilson argued that Labour needed “to protect itself against the activities of small groups of inflexible political persuasion ... [the] extreme so-called Left and in a few cases extreme so-called moderates, having in common only their arrogant dogmatism. These groups”, he said, “are not what this Party is about”. 40 years later, unkind commentators argue that such a group is precisely what Labour and this manifesto are entirely about. On June 8th, we will find out whether the Labour Party as an institution can survive Jeremy Corbyn and John McDonnell's vision.

Edelman | Southside | 105 Victoria Street | SW1E 6QT London | www.edelmaneditions.com | 020 3047 2177 | @edelmanUK

KEY POLICY HEADLINES

WHAT IT MEANS FOR BUSINESS

NEGOTIATING BREXIT Labour would immediately guarantee EU nationals' residency rights. Its priority for the negotiations would be retaining the benefits of the Single Market and Customs Union - as well as staying in Euratom, Horizon 2020, the European Medicines Agency, Eurojust and Europol.

IMMIGRATION Mr Corbyn appears finally to have accepted that the free movement of people has to end post-Brexit. In practice, the suggestion of new rules which identify specific labour and skill shortages is likely to chime with the system the Conservatives seek to put in place.

INTERNATIONAL TRADE There would be a trade and investment White Paper, and Labour would seek to “work with global trading partners to develop ‘best in class’ agreements that remove trade barriers and promote skilled jobs and high standards”. Human rights and social justice would be allied to trade policy - with implications for heightened scrutiny of business’ supply chains - and a row would swiftly develop with China on the dumping of steel.

TOWARDS A NATIONAL CARE SERVICE Repealing the Coalition Government's Health and Social Care Act, and undertaking an ambition reform programme of joining up NHS and social care commissioning, pooling budgets and working arrangements. Much of the legwork for this was done under Ed Miliband and Andy Burnham.

A GLOBAL BRITAIN Language has been inserted to close down emotive lines of attack on Labour - for instance, on defending the Falklands - but elsewhere, the party commits itself to immediately recognising Palestine, taking “all lawful action” necessary against Daesh (potentially signalling the end of drone warfare), reviewing contracts such as arms to Saudi Arabia and disagreeing with the Trump White House.

TWEET OF THE DAY It took just an hour for Jeremy Corbyn to u-turn on axing the benefit freeze.

Owen Bennett, Huffington Post

In answer to a journalist’s question, Jeremy Corbyn committed to ending the Government’s freeze on benefits uprating. But he backed away from the pledge – not in Labour’s manifesto – moments later, prompting Conservative accusations of “nonsensical” policies and “chaos”.

1 May 2017

FINANCIAL SERVICES AND TAXATION The manifesto is in large part directed at damping down the ‘excesses’ of the financial sector with the introduction of a Financial Transaction Tax; a new additional payroll tax on companies which applies to each individual they employ earning over £330k; the extension of Stamp Duty Reserve Tax to derivatives and removal of exemptions; a reversal of planned cuts to the Bank Levy; the introduction of a new levy which hits offshore trusts which purchase residential property in the UK; and increases to income tax for people earning above £80k. Perhaps most emblematically of all, in the section on Brexit, the manifesto makes no reference to the needs of the City from any Brexit deal.

WATER The pledge to renationalise the water industry – or to “replace our dysfunctional water system with a network of regional publicly-owned water companies” – would obviously have huge implications, especially as the Shadow Chancellor implied that compensation would not necessarily be at full market value. The pledge comes at a time when the industry is implementing competition for business customers and potentially moving to full retail customer competition. It’s not clear if Labour would proceed with these policies, or how they would work in the event of renationalisation.

ENERGY Labour’s proposals for the retail side of the energy market would represent a radical shift. With a plan to cap the average dual-fuel household energy bill below £1,000 per year and to create a new network of publicly owned regional energy companies, the intention is to radically shift the structure of the retail side in favour of the consumer. The creation of publicly owned competitors to private energy firms could be particularly impactful. On the future energy mix, the pledge to ban fracking and ensure 60% of energy comes from renewable sources by 2030 set out clear divides from the Conservatives, but in most other areas the two parties’ visions are surprisingly similar: notably, despite Jeremy Corbyn’s longstanding opposition, the manifesto makes a clear commitment to support new nuclear.

Edelman | Southside | 105 Victoria Street | SW1E 6QT London | www.edelmaneditions.com | 020 3047 2177 | @edelmanUK