November 12, 2019

10 ways Labour would wreck our economy

A Corbyn government means wasteful spending that would wreck the economy and dangerous plans to seize control of private businesses – at huge expense to the taxpayer. Corbyn’s Labour has committed to an additional spending splurge of £1.2 trillion over the next five years if they get elected.

This extra spending – an extra £650 million a day – is the equivalent of funding the entire NHS budget for nine years.

Labour’s economic plans would wreck our economy. Here are ten reasons why:

1. Labour would cause job losses

Labour do not know how to handle the economy and have always left unemployment higher than they found it. Under the last Labour government, unemployment rose by nearly half a million – leaving more people without the financial security of a regular pay cheque.

When Labour left office in May 2010, unemployment had risen by 23%. Since the Conservatives have come to Government, unemployment has fallen by over 1 million.

2. Labour would introduce a damaging 32-hour week

Labour would introduce a 32-hour working week – despite experts warning of the huge damage this scheme would cause. It would harm businesses and workers and lead to problems in hospitals.

It’s estimated to cost the public sector £85 billion over five years – paid for by taxpayers.

3. Labour’s taxes would be the highest in peacetime history

Labour will raise taxes to their highest level in peacetime history, according to the IFS. Labour have refused to back our tax cuts which have put more money in working people’s pockets, and failed to support our fuel duty freeze.

Since we have come to office, we have been relentlessly cutting taxes to put more money in the pockets of families across Britain. Labour would undo our hard work.

4. Labour would hike corporation tax

One of Labour’s tax plans is a corporation tax hike, punishing business and entrepreneurs for their success and driving out investment from this country. This would lead to job losses for ordinary people. Labour have already broken their promise not to pledge raising taxes for small businesses.

The Institute for Fiscal Studies have already made clear that Labour’s policies would lead to ‘higher prices, lower wages or less valuable investments.’ Higher corporation taxes mean smaller businesses struggling even more to compete, and higher prices for consumers.

5. Labour sees business as ‘the real enemy’

Labour’s hostility to business is hardly a secret, but Shadow Chancellor John McDonnell let the mask slip when he said he saw it as his job to overthrow capitalism. He made clear that he thinks ‘corporations’ are ‘the real enemy’. Labour’s economic plan will be written and put into practice by a man who does not believe in business, entrepreneurship, and capitalist society.

Boris Johnson has been clear: the Conservatives are the friends of business. Because we know that only a dynamic free market capitalist society can create the wealth and prosperity needed to fund our fantastic institutions like the NHS. Corbyn’s economic policy of alienating and attacking business will just make everyone poorer.

6. Labour would cause a run on the pound

Labour’s economic plans are so radical they are making preparation plans for a run on the pound and capital flight.

Capital flight is when money that businesses would spend to boost the UK economy is spent abroad instead. That means less money is spent in Britain, productivity stalling, and can cause an economic disaster. The last major run on the pound was during the Winter of Discontent.

7. Labour would destroy the independence of the Bank of England

The Bank of England has been independent for more than 20 years, creating economic security and stability. Labour however have pledged to install a hard-left governor of the Bank of England whois ‘in tune’ with their Marxist ideas.

The independence of the Bank of England is a vital part of the British economy. Labour’s economic plans would shatter its cherished independence. That would harm British business.

8. Labour would nationalise vast swathes of our economy

Labour want to renationalise vast swathes of our economy – leading to higher prices, higher taxes and less investment. John McDonnell said: ‘We’re going to bring back into public ownership rail, water, energy and mail. We will get this legislation through in the first Queen’s Speech – we want to hit the deck running’.

Experts have warned this could cost £196 billion. That would be the same as collecting every penny of income tax paid by UK citizens in a single year, or the entire NHS budget and education budget combined, and spending it all on a single giant white elephant project. That would put Britain back under the crippling debt of the last Labour Government.

9. Labour would let debt rise uncontrollably

Under Labour’s new fiscal rules, debt will rise and can continue to rise indefinitely and uncontrollably. This would be at the expense of future generations – who would be burdened with Corbyn’s borrowing binge.

Under the Conservative’s new rules, debt will be lower at the end of next Parliament, while still allowing for step-change in investment.  

10. Labour would take over businesses  

Labour have planned a ‘draconian’ tax grab of £300 billion, taking control of 10% of businesses.

They will force firms to place 10 per cent of their shares into an ‘inclusive ownership fund’. Some dividends would go to employees and the rest would be taxed. Clifford Chance warned this would confiscate £300 billion of shares in 7,000 companies.

The Institute for Directors called it ‘draconian’; and the British Chamber of Commerce described it as a ‘tax grab’. Labour’s economic plan to takeover business will cause nothing but disaster for the UK.

Labour have only just started their campaign, but we already know far too much about how they would wreck the economy.

Boris Johnson, on the other hand, would get Brexit done so we can unleash Britain’s potential. So Back Boris and vote Conservative to get a majority government that will Get Brexit Done with a deal, get Parliament working again, and turbocharge our economy to unleash Britain’s potential.

Region Labour's Pension Tax (£) Extra Months to Work
England 11,167 44
East Midlands 6,150 50
Greater London 12,871 45
North East 9,758 38
North West 6,835 47
South East 14,270 40
South West 7,407 45
West Midlands 10,729 41
Northern Ireland 13,718 35
Scotland 10,653 41
Wales 11,691 36
United Kingdom 11,253 43

Commenting, Therese Coffey, Secretary of State for the Department of Work and Pensions, said:

“Corbyn’s Pension Tax will see ten million savers facing a huge bill forcing them to delay their retirement for almost three and a half years.
“This is just one of the ways a Corbyn government would hammer hardworking people on top of his plans to hike up taxes by £2,400 a year, as well as the cost of his plan for unlimited immigration and the chaos of 2020 being dominated by two more referendums – one on Brexit and another on Scottish independence.
“Only Boris Johnson and the Conservative Party can get Brexit done with a deal, get parliament working again and turbocharge our economy to unleash Britain’s potential.”

Read more about how this Pension Tax will impact millions of savers (PDF)