John McDonnell MP

Shadow Chancellor of the Exchequer
Speech, Scottish Labour Party conference

11 March 2018

When I came into this hall yesterday I felt like I was coming home.

But when I listened to Richard’s marvelously inspiring speech I realised it was more than me coming home.

It was the Labour Party, our Party, coming home to us.

Thank you, Richard, for what you are doing and what you will do as leader of Scottish Labour and as First Minister of Scotland.

Richard yesterday made it clear, just as Jeremy and Lesley Laird did on Friday that Labour is an anti-austerity Party.

We are the only anti-austerity Party.

Let me explain why we are an anti-austerity Party.

This isn’t just about economic theory. It is a question of morality too.

It is immoral that in the 6th richest country in the world a homeless man who was seeking work, sleeping rough, dies this winter only 6 steps away from the entrance of Parliament.

It is immoral that our people, our fellow human beings, last year were dependent on over one million occasions on food parcels from food banks just to survive.

It is grotesquely immoral that two thirds of our children are living in poverty in families where someone is in work, caused by low wages.

We are no longer willing to tolerate a society where 71 men, women and children are burnt to death in Grenfell Tower after their pleas to the local Tory council about the safety of their block were ignored.

So let the message ring out.

We have had enough.

And we’re not taking it anymore.

We are coming for power and to power.

On Tuesday in Westminster the Chancellor of the Exchequer will stand up in Parliament to deliver his Spring Statement. .

All the indications are that he will ignore totally the growing emergency faced by our public services.

Up and down the country, eight years of austerity have left services at breaking point.

In England, the NHS has just suffered its worst ever winter crisis.

Sick people waiting to be treated left on trolleys and in corridors and 100,000 of them in ambulances parked outside A&E departments.

Council budgets have been slashed, with a million elderly people no longer receiving the care that they need.

Cuts in children services resulting in the highest number of children in care since the mid 1980’s, children’s charities warning that the crisis could turn into a catastrophe

And you know the Scottish Government has been just a conveyor belt for Tory cuts.

The SNP has slashed funding to councils, £1.5bn worth of cuts since 2011, cuts to lifeline local services and tens of thousands of jobs lost

In Education 3,500 teachers cut, class sizes bigger than they have ever been and an attainment gap that grows throughout primary school.

Poverty and inequality increasing …

260,000 kids in poverty …in one of our coldest winters fuel poverty endemic …health inequalities stubbornly persisting … and the economy stagnating

Nothing done in ten years to grow the economy, to tackle the blight of poverty that still scars Scotland …

Both north and south of the border, lives have been destroyed and millions left in despair thanks to the failed economic dogma of neo-liberalism and austerity.

Austerity was always a political choice, not an economic necessity.

The Tories and the SNP chose austerity.

We choose socialism

What UK Labour will do for Scotland It’s now up to us, our party and our movement to turn this around.

Only by working together across Britain can Labour confront austerity, and launch a new political era.

We began to do that in the General Election last year, when we saw six new Scottish Labour MPs

This was among the many other electoral victories thanks to Jeremy Corbyn’s leadership and our inspiring manifesto.

And of course with your hard work and idealism we came so close to winning so many more Scottish seats that are now considered marginal … it is these seats that will hold the key to us winning the next election …

Scotland will decide whether we have a Labour or Tory government.

You will be the people who will make a difference

So no pressure then.

In that election we pledged to reverse Tory cuts which have hit Scotland hard

And we will when we come into Government scrap the bedroom tax

We will restore Housing Benefit for people under 21.

We will increase Employment Support Allowance by thirty pounds per week for those in the work-related activity group …

I budgeted an additional two billion pounds a year for a review of Universal Credit

We are going to build a million new homes and we will be proud to call many of them council houses

We pledged to lift the public sector pay cap and we will.

The Tories have muted removing the pay cap for some workers but we insist it should be ended for all workers not just for some.

Let me tell them too to demand health workers surrender a day’s holiday pay in order to get a minimum pay rise after years of pay cuts is mean spirited and miserly. .

We will also introduce a Real Living Wage of at least ten pounds an hour which could benefit nearly half a million Scots…

These are simple policies that will transform the lives of millions in Scotland and across the rest of the UK.

Let me run through the figures of our investment plans

Our UK policy commitments to additional spending on public services, for example: education, social care, and childcare, would have immediately guaranteed additional spending for the Scottish Government through Barnett consequentials… reaching three billion pounds in 2022

We also pledged an additional two hundred and fifty billion pounds of investment spending over ten years across the UK through our National Transformation Fund.

Rebuilding our crumbling infrastructure, delivering key investment such as extending HS2 to Scotland, and investing in the industries of the future by boosting research and development.

Again through the settlement on devolved funding, that would mean twenty billion pounds of additional investment in Scotland over ten years

And that’s not all. Our UK National Investment Bank will be capitalised and built up to deliver another two hundred and fifty billion pounds of lending over ten years.

Investing in small and medium sized business, environmentally transformative projects, funding our engagement

In the fourth industrial revolution, supporting industrial strategy and rebalancing Britain’s economy away from London and the South East.

This could mean an additional twenty billion for the Scottish economy over ten years.

Compare that, by the way, with the measly three hundred and forty million pounds of initial capital budgeted by the SNP for their so-called Scottish Investment Bank.

I say this to the SNP if you are going to steal our ideas then for goodness sake do it with a bit of style

Taken together, our commitments over a decade could mean an additional seventy billion pounds for the Scottish economy.

That’s seventy billion pounds of potentially additional spending to support industrial strategy … to support renewable energy generation … to build houses … create jobs … and support growth …

That’s the kind of difference a Labour government will make.

That’s why we need Labour governments – in London and Edinburgh – to reverse the damage that has been done to Scotland.

Journalists rightly want to know where the money would come from.

It’s a question they never ask the Tories.

When the Tories needed to find a billion pounds to keep the reactionaries of the DUP onside they soon found the magic money tree.

But it’s only right that we should be scrutinised, as any government in waiting should be.

So we laid out our Fiscal Credibility Rule, which stipulates we will only borrow for productive investment, not for day-to-day spending.

And for day-to-day spending we published details of the taxes we would need to raise to match our spending commitments:

Raising income tax for the highest earners, those with the broadest shoulders paying a greater share…

Reversing cuts to corporation tax for the largest firms…

Introducing a Financial Transactions Tax so the city speculators are contributing their fair share …

A levy on offshore trusts in tax havens which purchase residential property, especially common now in London …where often the property stands empty

Through our tax transparency and enforcement programme we will tackle tax evasion and avoidance.

We will make the rich and the corporations pay their taxes.

By making the wealthiest, in the wealthiest areas especially around London, pay their way we can deliver for Scotland and the rest of the United Kingdom whose people have been forgotten and neglected for too long.

By leveraging the wealth of the few, we can redistribute to the many.

It’s socialism in action.

From each according to their means, to each according to their needs.

But as Richard described yesterday our socialism is about more than redistribution.

When we return to power we will have to fundamentally change the whole economic basis of our society.

Over the past forty years our industrial base has been dismantled , key public industries sold off , working class communities neglected…

Scotland’s industries disappearing through not just neglect but deliberate attempts by Conservative governments to smash the strongholds of the labour movement.

We will need to fundamentally reorganise our society collectively.

That’s why I’m so chuffed that Scottish Labour is so committed to delivering an industrial strategy that stimulates the Scottish economy, but in a way that benefits the many not the few.

We know that the free market fundamentalism of recent years cannot deliver the change we need.

It’s not just that privatised public services are more expensive and of lower quality.

We simply will not be able to face the challenges of climate change and automation without collective action.

Energy transition will depend on the initiative and ingenuity of the many to localise the production and consumption of energy.

But we need public ownership and democratic control to make that happen, and use the skills and knowledge of the workforce and communities across the country.

That’s why I was so pleased to hear Richard Leonard yesterday commit to a renaissance of public common forms of ownership, including a National Energy Corporation.

It’s why Jon Trickett is working with the rest of the Shadow Cabinet on detailed preparation for government.

And we have made it clear we will ending the dogma of outsourcing and we will bring key services under transparent, democratic control. It’s why we announced that we will take PFI contracts back in-house, to save money and gain control over key public infrastructure.

By the way, I know that in Scotland you now have the Non-Profit Distributing model instead of PFI… the only problem with that, is that it distribute profits.

Only a Labour government is prepared to make those deep structural changes to the ownership of our economy which are needed.

Not to mitigate globalisation, technological change, or Brexit, but to totally transform our economy from top to bottom.

The need to challenge existing authorities and transform our society has always lain at the heart of our movement, and of our party.

It drove Keir Hardie when he founded the Labour Party.

Jennie Lee when she founded the Open University to educate those who might otherwise miss out on higher education.

And though the circumstances change, their fight is our fight.

Thirty four years ago, Margaret Thatcher’s government announced the closure the closure of Polmaise colliery … I remember I worked for the NUM.

It’s nearly fifty years since the government of Edward Heath refused to support the shipbuilding industry, leading the workers of the Upper Clyde Shipbuilders to fight back with their work-in.

And before next Scottish Labour conference it will be a hundred years since Tories and Liberals in government sent troops to shoot at Scottish workers fighting for jobs and a reduced working week.

A few years later, Dundee itself gave its verdict on that Coalition government and its local MP, Winston Churchill…they sacked him.

The dividing lines today are the dividing lines every day … everywhere … as our movement has always known.

Not between brothers and sisters either side of a border, or across the channel, but between the haves and have nots … the 99% and the 1% … the many and the few.

Our goal in this movement is not and has never been about shifting power from one parliament and one set of politicians to another.

Our goal is about shifting power from those who own the wealth in this country back to those who, through their hard work and endeavour, create the wealth in this country…

That’s the real division in our society. Not between Scotland and England, but between working people and the money men…

"The demand of this movement and of this party is for a permanent and irreversible shift in power back to the people”

Those aren’t my words: they came from a GMB union official called Richard Leonard back in 2013.

Richard is someone I’ve known and been proud to work with for many years, and who I know will return Scotland to being the Labour heartland which it was and can be again.

Comrades, a permanent and irreversible shift in power is not just our demand.

It can now become a reality.

In Scotland and right across Britain.

We are in sight of creating that new society

A society which is radically transformed: radically fairer, more equal and more democratic….

A society which is based upon a prosperous economy, but an economy that’s economically and environmentally sustainable, and where that prosperity is shared by all…

A society which is – in other words – socialist.

We’re going to build that society here and now…

And with Richard’s leadership we’re going to start in Scotland and we are going to do it together.

Solidarity. .


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