Shadow Chancellor John McDonnell speech to Labour Party Conference

John McDonnell MP, Shadow Chancellor, speaking at the Labour Party Conference in Brighton today, said:

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I’d
like to thank Ken Loach for that wonderful film and thank Ken for his
incredible contribution to our movement. Can I also thank the Shadow Treasury
Team: Peter Dowd our Shadow Chief Secretary to the Treasury; Anneliese Dodds; Jonathon Reynolds; Denis Tunnicliffe; Bryan Davies and my brilliant PPS Karen Lee

Only a few months ago we were 24 points
behind in the polls. Our opponents and virtually every political commentator =
those two groups are often interchangeable by the way – they predicted that we
would be wiped out in the general election.

I said then in interview after interview
that the polls would narrow and we would shock them all. Not many believed me.
And let’s be honest until you saw the exit polls, most of you were pretty on
edge too, weren’t you?

Before the election, I said that once we
entered the election period and broadcasters were legally obliged to give us
some semblance of balanced coverage, we would turn the poll ratings around.

Why? Well, first because people would be
given a chance to see Jeremy Corbyn for what he is. The honest, principled and,
yes, the strong and determined person and leader that he is.  And, second, because people would see in our
Manifesto what we really stood for and our vision of hope.

And that is what happened.  And it’s also down to you, our members, whose
overwhelming enthusiasm inspired people in their millions to come out and vote
for us.  I want to thank you all.

So yes, we have proved that we are an
effective campaigning Party. We now have to prove that we will be an effective
governing party. A Government that can set the political agenda for a
generation.

If you study the history of our Party,
you will see that it’s always been the role of Labour Governments to lead our
country into each new era.

It was the Attlee Labour Government that
built a new society from the debris of the bomb sites, in the new era after the
Second World War. Those men and women who had endured so much throughout the
depression of the 1930s and who had sacrificed so much to defeat fascism,
placed their trust in our party.

My Dad was a sergeant in the army and my
Mum a welder by day, in a munitions factory, and an ARP warden at night. They
came out of the war with that spirit of 1945, inspired in them by the election
of a Labour Government.  

And the Labour Party fulfilled its
promise to them and all the other families by creating the welfare state,
providing free education for their children, building them a decent home
,investing in an economy based upon full employment. And, of course, creating
that jewel in our crown, our NHS.  

In the 1960,s when the Tories governed
this country from their gentlemen’s clubs on behalf of the privileged few and
held this country back from facing the challenges of the modern era, it was the
Wilson Labour Government that recognised the potential of a modern Britain,
forged, as he said in “the white heat of the scientific revolution.”

For my brother and me, and so many others
of our generation, new educational opportunities enabled us to challenge the barriers
that had held so many working-class kids back.

And, yes, in 1997, after 18 years of
Thatcherism, when whole industries and communities across our country had been
destroyed by the Torie,s and our public services were on their knees, it was
the Blair/Brown Government that recognised and delivered the scale of public
investment that a 21^st century society needed.

We should never forget that we are part
of that great Labour tradition and we should be so proud of it.

So as we now enter the next, new era, the
era of the fourth industrial revolution, I tell you it is a Corbyn Labour
Government that will rescue our country from the long years of austerity. And
it will be up to us to lay the foundations of the new world that awaits us.

That new world is being shaped already by
the beginnings of the fourth industrial revolution.  Huge changes are underway in our society and
economy. Technological change is accelerating. This year, Chinese scientists
used quantum mechanics to teleport data to a satellite.

We can match that, we’ve got a Tory
Government teleported from the 18^th century.   We are determined that Britain embraces the
possibilities of technological change – scary though that may be. By the middle
of this century, it is possible that up to half of all the jobs we do now could
be automated away.

The
jobs that remain can, if we let them, be exploitative, dangerous, degrading,
and dead-end. Or the jobs we create can provide good, secure employment, in
work that is fulfilling and meaningful, in communities where pride and
prosperity has been restored.

We have already had a foretaste of what
this revolution would look like if it was left to the Tories. It is being used
to vastly enrich a tiny elite, whilst creating a life for many workers of long
hours, low pay, and insecure employment.

There’s a choice to be made. We can
remain a low-wage economy,y specialising in zero hours contracts. Or we can use
the state to help shape Britain’s future in this new world.  We know it can be done.

As
the Tories waste time and energy, alienating our closest trading partners,
other countries are using state direction of innovation and investment to carve
out vital areas of expertise – in robotics, in electronic cars, in cleantech,
in the smart city. Though the technologies are new – the British problem is
old. The City is not channelling investment into high value, high productivity
businesses.  Instead, it’s channelling
investment into property speculation.

It’s
the rentier economy, where wealth is secured not by what you produce, but by
the amount of rent you can charge. So we will change that.  We’ll put taxpayers’ money into key research
projects; we’ll foster the creation of networks and clusters of expertise. To reconnect the financial sector to the
economy of research and development and production, we will transform our
financial system.

Labour will establish a Strategic
Investment Board, comprising the Chancellor, Secretary of State for Business
and Governor of the Bank of England, to co-ordinate the promotion of
investment, employment and real wages.

In our investment strategy, we will no
longer accept the disparities between investment in London and the Home
Counties and the rest of the country.

This Tory Government plans to invest in
the north just one-fifth of what it will spend on transport per head in London.

We will legislate for a fair distribution
of investment. We’ll devolve decision making through the Regional Development
Banks, our Mayors, and regenerate the powers and resources available to local
councils.

We’ll build Crossrail for the north,
connecting our great northern cities from west coast to east, and extend HS2
into Scotland. We’ll deliver the funding for Midlands Connect, overhauling
transport across the Midlands. And we’ll overturn decades of neglect and lack
of investment in the South-West. We’ll electrify railway lines from Cornwall
right through to London.

The storms and flooding sweeping the
world in these last few months are yet another environmental wake up call. This
country has huge natural, renewable resources.
And we have an immense heritage of scientific and engineering expertise.
Yet this Government has slashed the funding, the renewables industry needs to
find its feet.

Labour will ensure we become world
leaders in decarbonising our economy. With a publicly owned energy supply based
on alternative energy sources. Where the Tories have dithered and delayed, to
deliver zero-carbon electricity, we will absolutely commit for example to
building projects like the Swansea Tidal Lagoon.

Ours will only become an economy for the
many, if we significantly broaden ownership. That means supporting
entrepreneurs, small businesses, the genuinely self-employed and massively
expanding worker control and the co-operative sector.

Building an economy for the many also
means bringing ownership and control of the utilities and key services into the
hands of people who use and work in them. Rail, water, energy, Royal Mail-
we’re taking them back.

We cannot allow this dynamic vision for
our economy to be undermined by the combination of belligerence and
incompetence, displayed by the Tories in the current EU negotiations. Our aim
is to create a Britain for the many, not the few. Our conscience doesn’t end at
the English Channel. We also want a Europe for the many, not the few.  

That’s why, whilst respecting the
referendum decision, we will work with our partners across Europe to create a
new European future, based upon collaboration and co-operation.

But we start with addressing the brutal
treatment of EU citizens by this Government. We demand that the rights of EU
citizens in this country are fully protected, just as we wish to secure the
rights of UK citizens in other EU countries.

And I warn the Tories if they try to
water down, or undermine protections we have secured on employment, consumer or
environmental rights, we will give them the political battle of their lives.

As we go into Government, you know we
will have to clear up the mess the Tories will have left us. After their long years
of austerity, the Tories are leaving a society steeped in debt and scarred by
low pay and insecurity, with our public services in meltdown. We will
commission a thorough review of the scale, causes and responses to debt. But
action is needed fast.

First, we will do what the Tories have
failed to do, and bring the Government’s deficit and debt under effective
control. The Tories have borrowed more than any Labour Government ever.

On arrival in office, we will set out
plans to eliminate the deficit and reduce debt, based upon our Fiscal
Credibility Rule. For each policy in our Manifesto, we are preparing detailed
implementation plans. To pay for our public services, we will close the tax
loopholes and avoidance scams used by the mega-rich, and we will make sure the
rich and the giant corporations pay their way.

Many people are also forced into debt by
low wages. It cannot be right that we are the only major developed economy to
have grown, while wages are lower than they were before the crash ten years ago.
And as inflation hits, many workers are facing yet another real-terms cut in
their pay, while the pay of FTSE 100 Chief Executives is 160 times that of the
average worker.

In the election campaign Theresa May was
asked why nurses were being forced to resort to foodbanks and she replied that
the issue was complex. It isn’t complex. It’s simple. They just aren’t being
paid enough.  

That’s why we insist the pay cap is
scrapped once and for all and not just for some, but for everybody. And we
demand decent wages for all workers. Britain deserves a pay rise. It’s why we
will introduce a real living wage of £10 an hour.  We will introduce pay ratios at the top. We
will address the gender pay gap that leaves women’s wages still trailing men’s
by 14%. And we will ensure every piece of legislation will be
measured against its impact on women before implementation.

I am proud to support those brave young
people who are campaigning for decent wages now, and those who have joined the
Bakers’ Union, to take on the might of McDonalds. Be clear, we will restore
basic employment rights, repeal the Tories Trade Union Act, set up a new
Ministry of Labour and restore collective bargaining.

As wages have fallen behind, more and
more families are being pushed deeper into debt. Household debt in this country stands at the record level of more
than £1.8 trillion. We have seen with pay day loans; some
companies were making massive profits from people’s financial difficulties.

Under Labour pressure, the Government was
forced to cap interest payments on payday loans. But more than 3 million credit
card holders are trapped by their debt. They’ve paid more in interest charges
and fees than they originally borrowed. The Financial Conduct Authority has
argued for action to be taken on credit card debt as on pay day loans.

I am calling upon the Government to act
now and apply the same rules on payday loans to credit card debt. It means that
no-one will ever pay more in interest than their original loan. If the Tories
refuse to act, I can announce today that the next Labour Government will amend
the law. Call it the McDonnell amendment.

Some of the heaviest debt burden has
fallen on young people.The Tories tripled tuition fees and allowed the Student
Loans Company to hike up interest rate charges. Young people are now leaving
university with £57,000 worth of debt. That’s why we put forward our
fully-costed commitment to scrap tuition fees.

And we will.

The Tories, with the connivance of the
Liberal Democrats, have created a totally unsustainable situation. Three
quarters of students will never fully repay their loans. So it’s not just bad
for students; it’s a bad deal for the taxpayer too.

As a result of Labour pressure, the
Government is now being forced into discussing reducing interest rates or
raising repayment thresholds. If they bring forward effective proposals we will
support them. But that won’t go nearly far enough. We can’t afford another five
years of spiralling student debt.

According to the Institute for Fiscal
Studies, and our independent research, writing off the Tories’ student debt now
would cost £10bn by 2050. Waiting until 2022 could treble the cost of a write
off. I am calling on the Chancellor to
act now, before the situation becomes unmanageable.

It’s the Tories who have got young people
into this mess, they should take some responsibility for getting them out of
it.

It’s not just students and households
with credit cards who are being ripped off.The scandal of the Private Finance
Initiative, launched by John Major, has resulted in huge, long-term costs for
tax payers, whilst handing out enormous profits for some companies. Profits
which are coming out of the budgets of our public services.

Over the next few decades, nearly two
hundred billion is scheduled to be paid out of public sector budgets in PFI
deals. In the NHS alone, £831m in pre-tax profits have been made over the past
six years. As early as 2002 this Conference regretted the use of PFI.

Jeremy Corbyn has made it clear that,
under his leadership, never again will this waste of taxpayer money be used to
subsidise the profits of shareholders, often based in offshore tax havens. The
Government could intervene immediately to ensure that companies in tax havens
can’t own shares in PFI companies, and their profits aren’t hidden from HMRC.

We’ll put an end to this scandal and
reduce the cost to the taxpayers. How? We have already pledged that there will
be no new PFI deals signed by us. But we will go further. I can tell you today,
it’s what you’ve been calling for.

We’ll bring existing PFI contracts back
in-house.

The Tories have tried to change people’s
view of what is normal and acceptable in our society. They want us to accept
that in the fifth richest country in the world it’s normal and acceptable for
people to be saddled with debt; for people to have to work long, often
insecure, hours, stressed out, struggling to find time with their family; for
people not to have a pay rise for years no matter how dedicated you are or how
hard you work; for young people to have no prospect of owning their own home;
for disabled people to be pushed to the edge by the benefits system; or for
carers to be struggling without support or recognition.

Let’s make it clear – we will never
accept that this is normal or acceptable.

Yes we will increase GDP, close the
current account deficit and increase productivity. But life is not just about
statistics. As Bobby Kennedy said almost 50 years ago:

 “The gross national product does
not allow for the health of our children, the quality of their education or the
joy of their play.  It does not include the beauty of our poetry.”  (18 March 1968)

The performance of our Government will be
measured by the care we show to all our people and the richness of their
lives.    

We proved in the election, and we will
now go on to prove in Government, our belief that:

Hope will always overcome fear.

Kindness and generosity will always
overcome greedy self-interest.

And that the flame of solidarity in our
society will never be extinguished.

For years we have proclaimed that
“Another World is Possible.”

I tell you now, that world is not just
possible, it is in sight.

Let’s create it together.