Corbyn's renationalisation plan to cost £196bn, warns CBI
Jeremy Corbyn's renationalisation plans would cost the UK economy nearly £200 billion up front and could wreck public finances, the CBI has today warned.
The Labour leader wants to renationalise water and energy utilities, train companies and the Royal Mail if he wins the next general election.
But the move would be an unmitigated disaster according to The Confederation of British Industry (CBI), which says the "beyond eye-watering" price tag will serve as a hammer blow to Britain's economy.
Economists from the CBI, which represents thousands of businesses, also said the renationalisation projects will have "no clear benefits" and will leave millions of Brits poorer.
Tory MPs in the West Midlands have also slammed Labour's plans, describing them as "nothing short of ridiculous".
CBI analysts said renationalisation would cost an initial £196m – the equivalent to taking every penny of income tax paid by UK citizens in a year.
The figure is also nearly as much as the annual national spend on the Health and Social Care budget (£141bn) and Education budget (£69bn) combined.
Renationalisation would also cost billions more in maintenance, running costs and new infrastructure, the CBI said.
Meanwhile debt is estimated to rise by almost 11 per cent – taking it to levels not seen since the 1960s – which would cost around £2bn a year to service.
Under Labour’s plans, savers and pensioners could suffer an estimated £9bn loss to their holdings – £327 for every household in the country – while the country’s public finances could take a hammering.
Rain Newton-Smith, CBI chief economist, said: “The price tag for Labour’s renationalisation plans is beyond eye-watering – close to £200 billion.
"And that’s only the starting point. It doesn’t take into account the maintenance and development of the infrastructure, the trickle down hit to pension pots and savings accounts, or the impact on the country’s public finances.
“There are so many other genuine priorities for public spending right now, from investing in our young people to the transition to low carbon economy and connecting our cities and communities.
"These issues are what keep businesses up at night and what they want to see the Government get on with addressing.
“Firms want politicians to invest in major infrastructure projects rather than undermine confidence in our economy and waste time, energy and public money in a renationalisation project with no clear benefits.
“Investment in skills, infrastructure and innovation is how we will enable firms to grow, create jobs, and raise living standards in communities across the country – not by returning to failed, ideological economics that would make millions of people poorer in their old age.”
Dudley South MP Mike Wood, said: "This just confirms what we all thought – Labour's spending plans are nothing short of ridiculous.
"Taxpayers want their hard earned cash to be focused on improving services, better roads and hospitals.
"Instead Labour are promising to give them this nonsense based on 1970s ideological dogma that Jeremy Corbyn is fixated upon.
"It has taken us a decade to recover from the last time Labour crashed the economy, now Corbyn wants to do it all over again."
Mr Corbyn said his renationalisation plan would mean "the essential services that we all rely on are run by and for the public not for profit".
'I’ve had the rug pulled from under me': Walsall Brexit Party candidate baffled over Farage’s climbdown