The Confederation of British Industry has served Labour with a challenge to publish the full details of its nationalisation plans, in the latest twist of an increasingly bitter row.
Britain’s leading business group hit back amid mounting pressure over its claim that Labour’s nationalisation plans would cost £196bn, releasing further details of how it came up with the price tag.
As relations deteriorate, the CBI’s full breakdown of how much each sector would cost to nationalise appears to confirm that the lobby group inflated the price tag by as much as £13.9bn, due to the inclusion of railway rolling stock. Labour has said buying the physical trains running on the rail network is not an official policy.
In a full breakdown of its assessment, the CBI said that taking the water industry into public ownership was the most expensive part of Labour’s plan, putting a price tag of £90.4bn on the proposals. It said that purchasing energy utilities would cost £89.1bn and bringing the Royal Mail back into public ownership would cost £2.6bn.
The details come after the CBI admitted to Labour that it exaggerated the cost of its nationalisation plans in an email exchange that was later leaked to the Guardian. It also said that its members would not feel comfortable if the full details were public.
Although the details confirm the lobby group included buying railway rolling stock, Carolyn Fairbairn, the director general of the CBI, said that the organisation stood by its analysis.
She said: “If Labour is now confirming that a future Labour government will lease rather than buy trains as its official position – which will bring its own costs – we will of course take this into account.”
Calling for an urgent meeting with the party, she added: “If Labour shies away from disclosing their estimates of such large-scale re-nationalisation, then others will need to fill in the gaps. The benefits remain unclear, the plans uncertain.
“If Labour disagree so profoundly with our figures, they should publish their own calculations, make their case and articulate the benefits.”
A spokesperson for Labour said the CBI had published contradictory and misleading estimates, “which have rightly been called out”.
“We have been clear that it will be for parliament to decide the level of compensation, as is usual in this situation.
“The need to end privatisation is urgent and popular and we are always happy to discuss that in our regular meetings with business organisations.”
The CBI said it was a reasonable assumption that Labour would nationalise rolling stock, because the party’s plans were ambiguous. In its 2017 manifesto, Labour said that it would “ensure new rolling stock is publicly owned” – a pledge that indicated new trains would be bought when required, rather than the wholesale purchase of existing stock.
Fairbairn said Labour’s manifesto was “strong on rhetoric but light on detail,” and warned that this “uncertainty makes investors think twice before backing Britain”.
“We are more than happy to explain our analysis, but also want to understand their own projected costs and how the state ownership process would work so that investor confidence is not undermined.”
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