Wed, 18 May 2022

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By Women in Westminster

ANALYSIS: Labour plays the same tunes as 2017 but turned up to 11

ANALYSIS: Labour plays the same tunes as 2017 but turned up to 11
3 min read

The 'one more heave' political strategy can be very attractive.

It was an approach followed by Labour in 1992 when, with the polls suggesting the country was ready for a change after 13 years of Tory rule, the party vowed to increase taxes if they got in.

After reducing the Conservatives' colossal majority in 1987, and with Margaret Thatcher having departed the scene, Labour believed that victory was finally within their grasp.

But despite a significant swing to Labour - and with even the exit polls suggesting a hung Parliament - John Major's Tories pulled off an unlikely triumph.

It took another five years of opposition, and Tony Blair's election as leader, for Labour to realise that relying on 'one more heave' was not going to be enough.

Yet, as with just about everything else in the Corbyn project, the lessons of New Labour are being studiously ignored this time around.

Far from tempering the message that helped Labour pull off a remarkable yet ultimately unsuccessful result in 2017, the party is approaching the electorate with pretty much the same manifesto as the last one. Except this time the socialist message is louder. Much louder.

Two years ago, Labour's manifesto set out plans for £70bn of extra spending. That figure has now almost doubled to £135bn.

The party wants to raise around £83bn of that sum from extra taxes (compared to £50bn in 2017) and roughly £55bn from borrowing (it was £20bn last time round).

These eyewatering sums will be spent on big, bold projects such as the nationalisation of the water industry, energy market, rail and BT Openreach, while also scrapping tuition fees, replacing Universal Credit and giving public sectory workers a 5% pay rise. If you like your politics red in tooth and claw, this is the manifesto for you.

But - and there is always a but - experts are warning that the manifesto, which is appropriately titled 'Time For Real Change', may just be too good to be true.

The Institute for Fiscal Studies says it would increase the tax burden to the sort of levels not seen since the Second World War.

On Labour's spending plans, IFS director Paul Johnson says: "It will be extremely hard simply to deliver anything like this scale of increase in capital spending, at least in the near-term, certainly in an efficient and cost effective way.

"If the intention really is to scrap Universal Credit and replace it with an entirely new benefit system then, as the last decade has shown, this would come with the risk of huge administrative complexity and costs."

The IFS also casts doubt on Labour's claim that the spending spree will all be paid for by corporations and the top 5% of earners.

"In the end, it is unlikely that one could raise the sums suggested by Labour from the tax policies they set out," said Paul Johnson. "If you want to transform the scale and scope of the state then you need to be clear that the tax increases required to do that will need to be widely shared rather than pretending that everything can be paid for by companies and the rich."

Labour will, of course, dismiss these warnings as Project Fear from a terrified establishment. They had better hope that voters agree, or the 'one more heave' strategy will, once again, end in failure.

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