Labour Party conference
McDonnell tackles tax avoiders but strikes moderate tone
However, his used his maiden address in the role, delivered to the party’s annual conference, to say he would clampdown on big business tax avoiders and demand reform of the Bank of England while retaining its independence.
If Labour won the next election it would force large corporations such as Amazon, Google, Starbucks and Vodafone to pay their “fair share” of taxes, he said.
It would seek to balance the books but would end the current government’s austerity programme and re-balance taxation to help the low paid.
The party would instead focus on strong growth and investment.
“We need to prove to the British people we can run the economy better than the rich elite that runs it now,” he told delegates in Brighton.
“Labour’s plan to balance the books will be aggressive. We will force people like Starbucks, Vodafone, Amazon and Google and all the others to pay their fair share of taxes,” he said.
John Cridland, director-general of the Confederation of British Industry, a leading British employers’ group, said in a statement that Mr McDonnell’s speech suggested a bigger role for the state.
“The overall impression of this speech was of rather more intervention in the world of business and the economy,” said the CBI leader.
“What’s clear to us is that you can’t be pro-growth and pro-jobs without being pro-business. And a thriving private sector is essential for raising living standards and paying for high-quality public services.
“We share the aim of seeing more people getting into higher-paid jobs but pay rises need to be sustainable and affordable – and based on rising productivity.
“Mr McDonnell talks of working in partnership with businesses and entrepreneurs, and recognises the importance of deficit reduction, infrastructure, and skills. But this is best achieved by liberating entrepreneurs to create wealth and jobs.”“Most companies pay the right amount of tax and in the last financial year business paid £174bn into the Treasury – singling out individual companies from the podium is not the best way of signalling a partnership approach with business.
“We welcome the commitment to the Bank of England’s independence but it remains to be seen what active monetary policy really means. There’s a risk that when the economy is close to full capacity intervening in monetary policy could increase economic volatility, push up inflation and raise borrowing costs for households and businesses.”