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Sunday shows round-up: John McDonnell says Labour’s nationalisation programme is no ‘magic card trick’

19 November 2017

4:56 PM

19 November 2017

4:56 PM

Philip Hammond – ‘We are delivering homes at record numbers’

Philip Hammond is set to deliver his second budget on Wednesday, which many believe will be make or break for his future at No. 11 Downing Street. He faces a difficult balancing act with challenges on many different fronts, including how to address the UK’s housing crisis. The Chancellor defended the government’s record on housing, though he acknowledged that the government did need to intervene in an area that he referred to as a ‘priority’:

AM: Almost everybody agrees that there is a housing crisis in this country. Sajid Javid was sitting in that chair a few weeks ago and he said we need really big thinking on this… Have you turned him down?

PH: …Sajid and I have been working very closely together with the Prime Minister. She said in Manchester in October that this is her number one priority, and the Budget is our opportunity to set out how we’re going to deliver on that priority, how we’re going to make good on our pledge to the next generation that they should have the same opportunities that their parents’ generation had. And it is not acceptable to us that so many fewer young Britons are able to own a home now than just 10 or 15 years ago. It is not acceptable to us that there are not enough properties available to rent and that rents are sky high. The answer is we have to build more homes. We are delivering planning permissions at record numbers. Actually, we are delivering homes at record numbers – 217,000 in the last year reported this week. That’s a dramatic increase since 2010.

AM: Do you have a target in your head about the number of homes you’d like to achieve by the end of this Parliament?

PH: The challenge here is affordability, and I think experts generally agree that to start to make inroads in the affordability problem, we’ve got to be sustainably delivering around 300,000 homes a year on average across the housing cycle. That’s a big step up from where we are now. There is no single magic bullet, and it’s certainly not just about pouring money in. Because if you pour money in without fixing the other elements of supply, you will simply create more house price inflation. That makes the problem worse, not better.

Hammond went on to drop a clanger when he claimed ‘there are no unemployed people’ – despite there being 1.4 million currently out of work (Steerpike has the details). The gaffe aside, Hammond remarked that ‘I do think we are at something of a turning point’ when asked about how the Brexit talks was progressing. On the exit bill, he added ‘We will make our proposals to the European Union in time for the Council, I’m sure about that,’ suggesting that the UK would increase its current offering of 20 billion euros.

John McDonnell – Labour’s nationalisation programme ‘not a magic card trick’

 

Philip Hammond’s opposite number has also come under scrutiny for his economic proposals. John McDonnell defended his plans to nationalise several of Britain’s key industries to Marr. However, the Shadow Chancellor stopped well short of putting a price on how much this would cost to implement, insisting that the large sums of money required will be ‘covered’ in the long run and that taxpayers would not lose out:

AM: You have a very ambitious programme for more nationalisation – of the railways, the Royal Mail and the utilities. How much is that going to cost? I’m looking for a number.

JM: You don’t need a number because what you do is you swap shares for government bonds and that is covered by the costs of those profitable industries we take over.

AM: Government bonds is still government spending. It’s still borrowing.

JM: Yes it is, and it will be Parliament who sets the price on any of those nationalisations. But what I’m saying is the cost is always covered because these are profitable industries and that will cover the cost of any borrowing.

AM: That may be the case in due course, but right at the beginning that isn’t covered. How much will taxpayers actually have to spend to renationalise these things?

JM: There will not be a burden on taxpayers. The price will be set by Parliament, government bonds will be issued and any cost of government bonds will be covered by the income from those profitable industries…

AM: It sounds a bit like a magic card trick, this.

JM: Well it isn’t because it has been done elsewhere and it has been done across Europe as well now. In Paris, water has been brought back into public ownership. Why? Because people feel they are being ripped off by profiteers.

Marr also accused McDonnell of being ‘Eeyore-ish’ in his previous predictions of doom for the UK economy under the Conservatives, particularly highlighting an occasion on which the Shadow Chancellor had referred to a potential depression. McDonnell replied that ‘For many people out there, this is a depression’.

Andy Burnham – Manchester should have a seat at the Brexit negotiations

The Mayor of Greater Manchester has called for his region to have a greater say in the government’s Brexit negotiations, claiming that he is concerned that the government will adopt a ‘London-centric’ approach. Arguing that Westminster had failed to deliver for the North in other important areas over the years, Burnham made the case for his seat at the table to Niall Paterson:

NP: Brexit remains the most divisive issue in British politics. There appears to be a role for the First Minister of Scotland, the First Minister of Wales in the talks, but no role for yourself.

AB: I know! There’s a committee with the Cayman Islands, the British Virgin Islands but no permanent seat for the English regions, for Greater Manchester. Quite frankly, that’s not good enough. I am worried we will get the same old story with a London-centric approach to Brexit where the government protects the City of London above other industries and that’s our fear. To guard against that, we need a seat at the table.

NP: You’ve written in the Sunday Times and you essentially make the point that Brexit happened because Westminster took its eye off the ball. [You say] ‘Westminster has failed the North of England’. Just explain that in a little more detail.

AB: It’s more than it’s eye off the ball Niall, it’s over decades. Westminster, in my view, has failed the North of England. It’s given us a second-class transport system, a housing and homelessness crisis, an education system that obsesses on the university route and neglects those with technical skills, and in the past it’s focused on service industries and sold manufacturing down the river. So on many issues you can see how Westminster hasn’t come up with the solutions that the North of England needs. And now with Brexit looming, finding solutions to those issues has become urgent. And that’s why I’m making this call today on the Chancellor to say now is the time to go further, faster, deeper with devolution. Give people real control, hand back power to the regions, and that’s the best way to rise to the challenge of Brexit.

Jacob Rees-Mogg – Our negotiating position is strong

And Jacob Rees-Mogg has given his two cents on how to maximise the UK’s negotiating hand against the EU. The high profile backbencher outlined Sarah Smith what he thought the government should do in a tight spot:

SS: If the Cabinet start to suggest that they might pay significantly more than Theresa May indicated in Florence – is this something else that might spark another war in the party?

JRM: The EU is saying they want us to settle the money first. That is their negotiating position, that is not holy writ. The government doesn’t have to follow that, and they need our money. If we don’t pay any money for the final 21 months of the Multi-Annual Financial Framework, the EU has about an £18-20 billion gap in its finances. It has no legal authority to borrow, and that means either it’s insolvent, or the Germans and others have to pay more, or possibly some receive less. So our negotiating position on money is very strong, and we shouldn’t fall into the trap of thinking that just because Monsieur Barnier has said it, it is as if he had received tablets of stone like Moses. He hasn’t.

When asked about his attitude to the Remain-supporting Philip Hammond, Rees-Mogg responded: ‘I have a great deal of confidence in the chancellor’, but disparaged the Remain campaign’s economic forecasts as ‘not just… false, but hopelessly false’.


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