Cover of Global Britain paper

Labour’s plans for the economy once they are in power have been dressed up in words like ‘stability’, ‘investment’, and ‘security’. They represent a great leap forward – over the precipice on the edge of which the UK already teeters.

This is laid out in the Global Britain paper ‘De-coding Rachel Reeves – revealing Labour’s real plans for the economy and the EU’.

You can download the paper here.

For her template for the future the Shadow Chancellor of the Exchequer, Rachel Reeves, harks back to the ‘decade’ of supposed success under New Labour, forgetting the last three of their thirteen years in power when there was a spectacular collapse, as New Labour’s financial poster children Northern Rock, Bradford&Bingley, Halifax-Bank of Scotland, Alliance&Leicester and Royal Bank of Scotland all folded.

Today’s Labour are similarly silent about New Labour’s extensive usage of Private Finance Initiative (PFI) for ‘investment’ into ‘public assets’. PFI kept the associated heavy borrowing out of the UK’s national debt and Debt-to-GDP ratio, and a good thing too, as New Labour borrowed so much that a ratio of 38% when New Labour came to power had risen to 63% when they left, even with the exclusion of the PFI debts. The bill for New Labour’s usage of PFI continues to be paid, by the NHS, by councils and by universities.

Labour are in love with ‘institutions’ like the Bank of England and the Office for Budget Responsibility, and we will get many more such quangos, each controlling different aspects of the economy. The space remaining for private enterprise will be minimal.

This extension of ‘institutions’ and quangos will provide many more seats for the centre-Left nomenklatura, who already dominate national life, enjoying power without accountability to the public.

Labour will cosy up to the EU, and would dearly love to rejoin it. In the meantime they will merely ape it, not least in turbo-charging a new PFI-style scheme to finance the transition to Net Zero, which is a financial goldmine according to Rachel Reeves.

Somehow the national budget will come into balance on the day-to-day costs, even though Labour will immediately boost resources for the NHS – that can only mean tax rises as extra borrowing to meet day-to-day costs is ruled out. That does not mean no extra public borrowing: borrowing for public ‘strategic investments’ will again be conducted in a separate budget to keep it optically off the national debt. New Labour used PFI Mark 1 to make new schools and hospitals pop up. Now PFI Mark 2 will produce renewable power sources and toll roads too, using the template of the EU’s European Fund for Strategic Investments.

Planning laws will be relaxed to enable the construction of these ‘strategic investments’ and to build many more new homes, but protection of the environment will be a priority. Incoherent?

Private pension money will be ‘mobilised’ for usage within PFI Mark 2, to supposedly offer savers better returns, meaning that the costs of any services delivered by this PFI Mark 2 will be high, and will only ever go up and never down, just as they did (and continue to do) under PFI Mark 1.

Taxes can only go up, to keep the day-to-day costs budget in balance as Labour spends more on the NHS and on the process of government, with its expansion of intervention and quangos. Taxes up, borrowing up, a bigger public sector, a squeeze on the private sector – same old…

Rachel Reeves calls her plans ‘Securonomics’ but we can call it stagnation, as served up by Labour during the 1960s and 1970s when it hubristically named itself ‘the natural party of government’.

If you believe that these plans offer a solution to the UK’s low economic growth, high national debt, high taxes, mediocre productivity, high welfare bill and big state sector, vote Labour. It is the safe and secure choice. It contains no risk at all because the outcome is completely certain: it’s disaster.