McDonnell pledges £500bn investment – as deputy leader Watson quits

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John McDonnell and Tom Watson together at a rally in support of striking BA cabin crew

‘WE STAND in the best tradition of British socialism,’ Shadow Chancellor Labour’s John McDonnell said to cheers, outlining yesterday Labour’s economic policy for the general election.

He was introduced to the audience in Liverpool by Labour leader Jeremy Corbyn. The rally took place hours after anti-Corbyn right-winger, Labour ex-deputy leader, Tom Watson, announced that he is quitting Parliament and stepping down from the role.

Yesterday morning, ex-Labour MP Ian Austin called for people to vote for Tory PM Johnson rather than Labour leader Corbyn. Asked if he was advocating for the electorate to vote for Johnson over Corbyn on December 12, Austin said: ‘I am,’ adding: I must do everything I can to stop Jeremy Corbyn from getting into power.’

After his speech, asked by the press about Ian Austin, McDonnell alleged: ‘Let me just say this about some of the statements made by a former Labour MP this morning. He is now employed by the Tories, what else do you expect him to do in an election campaign? When you are employed by the Tories, you speak on behalf of the Tories. That is what this was about.’

In his speech McDonnell, referencing past Labour Chancellors, said: ‘We stand in that trench of socialism, and all of them had a shared ambition with us, which is to change the world.

‘And that means changing and transforming that economic system which has so betrayed our people.

‘It cannot be right that in this economic system, which some people think is the perfect way to operate our economy, we had 1.6 million food parcels handed out through food banks last year to people, many of whom are in work!’

McDonnell announced a massive boost to public spending. At the 2017 general election, Labour announced plans to set up a national transformation fund to overhaul the UK’s transport links and infrastructure.

This includes a social transformation fund, which McDonnell said would now get an extra £100bn, providing a £150bn pot to be spent over the next five years. A further £250bn of investment will be spent across the country through the Green Transformation Fund. He promised to set up a Treasury unit in the north of England to take spending decisions out of Whitehall.

McDonnell said: ‘Our fiscal rule for the next Parliament will exclude borrowing for investment from our borrowing targets.

‘It will mandate us to deliver an improvement in the overall balance sheet by the end of the Parliament.

‘So that when we invest in the infrastructure our country desperately needs it’s recognised both as a cost and as a benefit.

‘Yes – adding to the government’s debt, but also adding to the government’s assets and strengthening our public sector to deal with the future.’

After the speech, when asked about the ‘Remain Coalition’ where the Greens, Welsh and Scottish Nationalists have decided to work together to attempt to get as many pro-Remain MPs elected as possible, McDonnell said: ‘On the issue around pacts, let’s be clear we are going to have a majority Labour government, we don’t need any pacts.

‘But I will just say this to those Greens and others who are getting into bed with the Lib Dems.

‘I remember what the Lib Dems did when they were in government. Go and ask any disabled person in this country, who went through the brutality of the Work Capability Assessment. Go and ask some of the families of the disabled people who never survived as a result of that. We will never enter pacts, coalitions or deals, like that, ever.’