SHADOW CHANCELLOR John McDonnell MP told the Labour Party conference on Monday that productivity is falling in the UK because the Conservative government is not investing enough.
McDonnell told delegates in Liverpool that the first thing the Labour Party would do if it gets into government is end austerity.
In his speech, McDonnell outlined what a Labour government would do to change the economy.
“The national debt burden was supposed to be falling by last year, and it is still rising. In money terms, it now stands at £1.6 trillion.” John McDonnell MP
McDonnell said: “We need to appreciate the mess that the Tories are leaving behind for when we go into government.
“Six years on from when they promised to eliminate the government’s deficit in five years, they are nowhere near that goal.
“The national debt burden was supposed to be falling by last year, and it is still rising. In money terms, it now stands at £1.6 trillion.
“Our productivity has fallen far behind. Each hour worked in the US, Germany or France is one-third more productive than each hour worked here.
“Our economy is failing on productivity because the Tories are failing to deliver the investment it needs, and government investment is still planned to fall in every remaining year of this parliament.”
McDonnell added: “In the real world economy that our people live in wages are still lower than they were before the global financial crisis in 2008.
“There are now 800,000 people on zero hours contracts, unable to plan from one week to the next, and the number continues to rise.” John McDonnell MP
“There are now 800,000 people on zero-hours contracts, unable to plan from one week to the next, and the number continues to rise.
“Nearly half a million in bogus self-employment, 86 per cent of austerity cuts fall on women, nearly four million of our children are living in poverty.
“As the fifth richest economy in the world, it shouldn’t be like this.”
McDonnell went on to tell conference how a future Labour government would “rewrite the rules of the economy”.
McDonnell promised that a Labour government would end “the social scourge of tax avoidance”, and introduce a £250bn investment programme to “bring Britain’s infrastructure into the 21st century”. He also promised a £10 per hour living wage.
He went on: “We will create a new Tax Enforcement Unit at HMRC, doubling the number of staff investigating wealthy tax avoiders.
“We will ban tax-dodging companies from winning public sector contracts.
“And we will ensure that all British Crown Dependencies and Overseas Territories introduce a full, public register of company owners and beneficiaries.”
“We will create a new Tax Enforcement Unit at HMRC, doubling the number of staff investigating wealthy tax avoiders.” John McDonnell MP
According to McDonnell, the £250bn national investment programme, via a National Investment Bank, would stimulate long term investment for a more productive economy.
He said: “It means putting the investment in place that will transform our energy system, providing cheap, low-carbon electricity.
“It means ensuring every part of the country has access to superfast broadband, matching the best in the world. It means delivering the transport improvements, including HS3 in the north of England, that will unlock the potential of our whole country.”
He added: “For too long major decisions about what and where to invest have been taken by Whitehall and the City. The result has been underinvestment and decline across the country. It’s time for our regions and localities to take back control. So we will create new institutions, not run by the old elite circles.”
McDonnell spoke of his disgust at the fact that more than 200,000 workers in the UK are receiving less than the minimum wage, by saying it is “totally unacceptable”.
“It means ensuring every part of the country has access to superfast broadband, matching the best in the world. It means delivering the transport improvements, including HS3 in the north of England, that will unlock the potential of our whole country.” John McDonnell MP
As a result, McDonnell added that a future Labour government would “properly resource HMRC and the Gangmasters and Labour Abuse Authority to make sure there are no more national scandals like Mike Ashley of Sports Direct”.
McDonnell also discussed the achievements of the previous Labour governments that includes establishing the national minimum wage.
He said: “Under the next Labour government, everyone will earn enough to live on.
“When we win the next election we will write a real Living Wage into law.
“When we win the next election we will write a real Living Wage into law.” John McDonnell MP
“We’ll charge a new Living Wage Review Body with the task of setting it at the level needed for a decent life.
“Independent forecasts suggest that this will be over £10 per hour.
“This will be a fundamental part of our new bargain in the workplace.”