Remember when John McDonnell claimed that nationalising the water industry wouldn’t cost taxpayers a penny? Well, wonks at the Social Market Foundation disagree. Drawing on data from academic studies, Ofwat, the London Stock Exchange and the annual accounts of water companies, the SMF have found that nationalising the water industry’s assets would initially cost £90 billion, more than the current education budget and a 5% increase in government debt levels, plus another £100 billion over the next 25 years to meet their investment requirements. Acquiring them for less than the market price would cost more in the long term as investors flee fearing further nationalisations. Guido enjoyed McDonnell’s tetchy response to the report, accusing the centrist SMF of being “right-wing”, implying they fiddled the figures at the behest of the water industry and taking a pop at its director James Kirkup:
“This is a report by a right-wing think tank, led by the former political editor of the Telegraph, and commissioned on behalf of the water industry. Labour has been clear that as established by legal precedent it will be parliament that decides the price to compensate shareholders. With returns significantly higher than bond yields the taxpayer will be better off following the return of water to public ownership.”
Who you gonna believe?
Completely unsurprisingly, Jezza is “a borderline trainspotter” with a self-confessed “zany” passion for Britain’s railways. When he’s not trying to make a political point by sitting on the train floor he’s he’s getting abuse hurled at him by a carriage full of travelling football fans…
But here’s news sure to make the Labour leader run out of steam: Jezza’s favourite trainspotting magazine Rail carries a long read ripping his headline rail nationalisation policy to shreds. The piece, ‘Nationalisation – a dead end argument’, signals Labour policy is just not the ticket:
“Governments are not very good at delivering public services themselves -there is a tendency to meddling, short-termism, starvation of funding, and nakedly politicised decisions every time things get difficult. Much better to set out the framework of what you want to achieve over a period of time, and then contract with a focused and properly incentivised company to deliver your requirements.”
In fact, the article lists so many objections to Corbyn’s rail plan that it’s difficult to keep track. All put forward by an author of considerable station: a former top railway executive who oversaw a government-run line. With critics like this, how can Jezza just carriage on regardless with the policy?