Labour has not revealed how much money is needed to fund its renationalisation programme when Jeremy Corbyn unveiled the party’s manifesto today, competing with the Conservative manifesto
The party committed to pumping an additional £48.6billion into education, social care and pensions, using tax hikes on businesses and top earners to pay for it.
Yet in its “Funding Britain’s Future” document, released alongside its manifesto, there was no mention of how a Corbyn-led government would pay for renationalising the railways, Royal Mail, the electricity board and water companies.
Among the commitments it did cost, the party vowed:
To restore nurses bursaries,
Double paternity pay and paternity leave,
Lift the public pay cap,
Axing tuition fees
Scrapping employment tribunal fees
Where Labour will get the money
Business tax changes
The largest sum of money will come from changes to corporation tax, which Labour claims will raise £19.4billion. Under the Tories, corporation tax – currently 19% - will drop to 17% by 2020. Labour would raise the tax to 26% by 2020.
Increase taxes on those earning over £80,000
By reintroducing the 50p tax rate – but this time for those earning £123,000 a year – and lowering the 45p rate to those taking home more than £80,000, Labour believes it can raise £6.4billion.
Taxing companies for paying large wages
One of the headline announcements ahead of the launch is the Excessive Pay Levy, which will see companies having to pay an additional tax based on employees which earn over £330,000.
There will be a 2.5% levy on those earnings above £330,000 and 5% on those above £500,000.
Tackling tax avoidance
It is a promise politicians always make – making sure people pay their taxes. Labour believes it can raise an additional £6.5billion through a clampdown, but gives scant details about how it will manage this.
The footnotes in the document sayd this pledges is :Linked to Labour’s ambitious programme to tackle tax avoidance and evasion and lying between the Conservatives’ and Labour’s own commitments from the 2015 manifestos.”
Vat on school fees
This policy was announced earlier this year, with the cash used to fund free school meals for primary children. Labour believe it will raise £1.6billion, and the money has been grouped in with the additional £6.3billion set aside for schools.
What’s not costed
Labour’s flagship policies involve renationalising the railways, Royal Mail, the electricity board and water companies.
Yet there is no mention in this document of how the party will pay for any of those commitments.
The biggest clue is the creation of National Transformation Fund – which will be filled with £250billion of borrowed cash. This fund will be used to build new high-speed railways, and to “transform our energy systems.”
Labour also vowed to halt the Tories plan to increase the retirement age to 68 by 2046. The manifesto pledges to keep the increase to 66 by 2020, but the party will “commission a new review of the pension age” for after this.
Raising the state pension age to 67 was calculated to save the Treasury almost £60billion.