Reeves on Macro-economics

It came as a shock that she spoke for an hour, given that delegates who might want to oppose her, only got 1 minute. I summarise the speech here, as much of it was just political ballast, although sometimes you need to build a justification for what we do.

She started with a litany of Tory failures, and repeated the lessons that we can, post-pandemic, clearly see who are the essential workers in our economy and see how poorly they’re paid. She noted Angela Rayner’s announcement of a series of welcome protections and improvements to the social wage and employment protection law and segued to the need for an effective economy that works for all of us.

Possibly the crucial and welcome quote is,

We cannot have a return to the failed approach of austerity.

Rachel Reeves

She then spoke of tax reform and the need for a fair tax system, she proposes to close the loopholes, establish equity between the treatment of earned and unearned income, abolish business rates, increase the Digital Services Tax (by 600%), and abolish the charitable tax status of private education.

On fiscal policy, she says, that, she would put in place fiscal rules that will bind the next Labour government to ensure we always spend wisely and keep debt under control, so that we have the means to transform schools, hospitals, and communities, and pay for investment in the new industries and jobs that our country desperately needs. But not what those rules are, nor if they differ from McDonnel’s (or Dodds’)

One important point she makes is that she plans to get the money given to failed private sector CV19 interventions back. This is part of her justification for an Office for Value for Money; this strikes me as a gimmick; the Tories just turned off the controls that exist (the Ministerial Code and the NAO) that exist in order to give money to their cronies.

On Industrial Policy, where she shares responsibility with Ed Miliband she declares, “This is all part of our plan to buy, make and sell more in Britain” but there’s no mention of the National/Regional Investment Banks, nor of a replacement for the EU’s, now lost, Horizon 2020 programme.

While talking about combatting Climate Change, she says,

I will invest in good jobs in the green industries of the future; Giga-factories to build batteries for electric vehicles; a thriving hydrogen industry; offshore wind with turbines made in Britain; planting trees and building flood defences; keeping homes warm and getting energy bills down; good new jobs in communities throughout Britain.

Rachel Reeves

And adds

I can announce today that I am committing the next Labour government to an additional £28bn of capital investment in our country’s green transition for each and every year of this decade.

Rachel Reeves

But says nothing about how to choose the industrial winners, develop export markets to give the business scale, nor on a wealth tax, nor on interest rates.

It’s more populist than Annaliese Dodd’s speech last January, and I need to check what Ed Miliband said. As I said, after Annaliese’s speech, is this as good as it gets, we oppose austerity and might borrow to invest. A bit, “Meh” but it could have been worse. Shame she blew the good will she might have earnt by denouncing the Conference’s call to nationalise the energy companies that very evening.

Rachel’s speech is on Youtube, and a text version is on the Labour Party Press site.