Treasury and BoE reviews feature in McDonnell vow for Labour economic shakeup

Posted On: 
28th September 2015

John McDonnell has promised a “radical departure” from previous Labour economic policies.

Jeremy Corbyn's right hand man announced a review of the roles of the Treasury and Bank of England and pledged “aggressive” action to tackle tax avoidance.

In his first conference speech as Shadow Chancellor, Mr McDonnell said he was “fearful for the future” of the economy under the current Conservative administration. 

Mr McDonnell declared Labour the “only anti-austerity party”, but pledged the party would “always ensure that this country lives within its means”. 

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He paved the way for major institutional changes, including plans to turn the Department for Business, Innovation and Skills into a “powerful economic development department”, the establishment of an advisory panel of six prominent anti-austerity economists, and a new “effectively resourced and empowered national investment bank”. 

Alongside a review of the Bank of England, Mr McDonnell said he had asked Lord Kerslake, the former head of the civil service, to review the role of the Treasury itself. 

“Institutional change has to reflect our policy change,” he said. 

“I want us to stand back and review the major institutions that are charged with managing our economy to check that they are fit for purpose and how they can be made more effective.

“As a start I have invited Lord Bob Kerslake, former head of the civil service, to bring together a team to review the operation of the Treasury itself.”

He said Labour would be willing to use “active monetary policy to stimulate demand where necessary”.

Labour would take an "aggressive" approach to balancing the books through tax collection, he promised.

“We will force people like Starbucks, Vodafone, Amazon and Google and all the others to pay their fair share of taxes," he told the conference hall.

60p INCOME TAX RATE

Mr McDonnell told ITV news a rise in the top rate of income tax to 60p would be a topic in Labour's economic debate.

"At the moment the Labour party policy is to take it back to the 50... [Putting it up to 60p] will be part of the debate we have."