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Labour needs to lead the fight for a progressive tax system – Richard Burgon MP Exclusive #Budget2021

“In the deepest crisis in decades, Labour needs to be much bolder in offering an alternative… And we can’t just sidestep big debates when they happen. The tax debacle of the past few days shows that if we continue to do so, then our party will be outflanked by the Tories with their phoney rhetoric of levelling up.”

Richard Burgon MP

This is an edited version of a speech given by Richard Burgon MP at the rally “For A People’s Budget” on 1 March (see full video here.)

When the Covid crisis hit, as one of the world’s wealthiest countries, we should have been well-placed to limit the damage. Instead, the government’s response has been catastrophic. With one of the world’s largest death rates and the worst-hit major economy.

The PM must take responsibility for this. But the rot goes much deeper than him alone. It’s the result of 40 years of neoliberalism. A rotten corrupt ideology that left us with a failing state where over 100,000 people have died unnecessarily. 

And it left us with weak public services, a failing social care system, a woeful lack of workers’ rights, and a hollowed-out social security system – all when we needed them most.

Millions of people have had their eyes opened to just how broken the system is. So this crisis must be a watershed – the moment to kill off the idea that unfettered free-markets, privatisations, outsourcing and cuts to public services are the answer to all our ills.

FORK IN THE ROAD

Labour’s leadership has said this must be a 1945 moment – a fork in the road – and I completely agree with that.

Something new will replace the pre-crisis economy that was already broken when Covid struck. It is our job as the opposition to lead the debate on what that new economy looks like. To ensure it is an economy that serves the many – not the few.

In the deepest crisis in decades, Labour needs to be much bolder in offering an alternative. The crisis is now and so the Labour Party needs to have answers now on the big issues facing our communities.

That isn’t counterposed to preparing to win in 2024 – it’s an essential part of it.  By showing people day-after-day that we have their backs and we have a better way forward for them.

FOR A PROGRESSIVE TAX SYSTEM

And we can’t just sidestep big debates when they happen. The tax debacle of the past few days shows that if we continue to do so, then our party will be outflanked by the Tories with their phoney rhetoric of levelling up.

We can win the argument for a progressive tax system – but only if we make the case.

Now of course, as a Party we should be clear that the best way to pay down the debts incurred through emergency measures in this crisis is by creating jobs and growth.

Investment-led growth, not cuts and austerity – that’s how to deal with the debt.

But on tax, we also need to lead the debate for a progressive outcome.

That means a windfall tax on super-profits made during this crisis – including on those companies who made huge gains due to their links to top Tories.

It means increasing corporation tax, just as Biden is doing in the US, while also making it fairer by charging lower rates for struggling smaller local businesses than for multinationals making super-profits.

It means higher taxes on dividends and capital gains so the rich aren’t paying lower rates on their wealth than many workers pay on their wages. 

And it means the very high earners paying more including with a new 50% income tax rate on those earning above £125,000

STATE-LED GROWTH

And if we argue that growth is the way to drive down the deficit then we must have a strategy for jobs and growth.

Even before the Covid crisis, we’d had a decade of low growth, low wages, low investment, low productivity.

We can’t hope that the same rigged economic model will deliver something better in the future.

Our alternative must be a state-led plan that serves people and the planet  – not the 1%.

A PEOPLE’S BAILOUT

The first part of that plan must be a package of emergency measures to protect people from the worst excesses of this crisis.

A People’s Bailout – the banks were bailed out so why not our communities?

An emergency package would include a pay rise for all public sector workers, rent relief, furlough extended but also guaranteeing that no one on it is paid less than the minimum wage, proper sick pay, a £10 per hour minimum wage, boosts to social security and so much more.

But beyond that we need to be calling for state investments that transition the economy to meet the challenges of the future.

We can’t go one providing more life-support for a broken economic model based on low paid insecure jobs and that for decades has failed people and the planet. A model which twice in the past 15 years – in the global Crisis and the Covid Crisis – has needed the state to bail it out. And where huge public funds are often allocated based on political connections.

A VISION FOR A BETTER SOCIETY

So we need to wage an argument not for greater public investment in creating jobs and growth. And we must also paint a vision of how that investment will build a better society. One that can deal with the great challenges of the next decades

A vision of how we tackle climate change, mass unemployment and regional decline with a Green New Deal that creates millions of skilled new jobs and gets us on the path to net-zero carbon by 2030.

A vision of a society based on the solidarity and community spirit we saw at the start of this crisis through the rebuilding of our public services – renewing our social fabric and creating good jobs that serve our society.

A vision of a society that treats older people with dignity and not as profit-making opportunity – with a publicly-run National Care Service

A vision of a society where people have the dream of a good home fulfilled through the building of millions of quality council houses

A vision of a modern country with publicly run infrastructure including broadband and transport systems fit for the 21st Century

A vision where no child goes hungry and poverty abolished with a social security system that treats people with respect, not punishment.

This crisis isn’t the moment to suspend politics.

It’s a moment to deepen them so that we get the country that works for the majority who for so long have been badly failed by our rigged system.  Of course, there can be no going back. Our party needs to start leading the fight for the future.

Credit – https://www.flickr.com/photos/keegstra/5521705234

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