Burnham's bigger state: Water, energy and housing back under government control

‘We can’t go on as we are’

Andy Burnham is preparing to use his first Labour conference speech as Prime Minister to promise a major expansion of state control over the essentials of British life, arguing that politics-as-usual has failed and that the country needs “less drift and more direction”. His programme will target energy, water and housing, with the Government seeking greater control over services that have traditionally been run by private companies.

The state moves into the energy market

Burnham is expected to announce GB Grid, a government-backed body using money previously allocated to Great British Energy to invest in the electricity transmission network and compete with privately owned operators. He says Britain needs to regain control of energy costs, which he argues are putting pressure on households and businesses.

Thames Water is another major test. Ministers are examining whether the debt-laden company could be placed into a special administration regime if a rescue plan fails, potentially putting the utility under temporary public control. Full nationalisation of the major utilities is not currently expected because of the enormous cost.

Housing joins the plan

Housing is also being pulled further into the public sector, with Burnham promising a new wave of council housebuilding. Ministers are also pursuing powers allowing councils to take control of long-term empty private properties.

The wider aim is to give local government a larger role in housing, transport and other basic services, part of Burnham’s stated ambition to push more power away from Westminster and into the regions.

Then comes the pension question

The most politically sensitive issue may be the state pension triple lock.

Burnham has promised an NHS-style system of universal social care, but the cost has not yet been settled. Estimates have put the annual bill as high as £18 billion, although Burnham says the eventual figure could be lower and has promised that the system will be funded carefully.

There is growing speculation that the triple lock could eventually be reformed to help fund the scheme. Burnham has not committed to abolishing it, and the current Labour manifesto commitment remains in force. But Chancellor John Healey has refused to guarantee that it will continue beyond the next election.

That leaves pensioners facing an uncomfortable question: could the promise of universal social care eventually come with a change to the guarantee protecting their pension increases?

And Healey says the money simply isn't there

The timing is striking.

While Burnham is promising a larger role for the state, Chancellor John Healey told Labour conference that “the money New Labour had in the nineties is simply not there now” and warned that the Government must maintain fiscal discipline. He also said Labour could not allow the benefits bill to keep growing without reform.

That is the fundamental challenge facing Burnham's new Labour project.

He is promising more public control, more council housing, a new social care system and a different relationship with Europe — while his Chancellor is warning that Britain is already carrying heavy debt costs and that difficult choices are ahead.

Burnham says Britain cannot continue as it is.

The question now is how much his new direction will cost — and who will ultimately pay for it.

AN ORIGINAL

1 hour ago, Rimmer said:

And Healey says the money simply isn't there

Someone in the Cabinet with a brain.

Will he now resign on principle. Or was that just to get rid of the last clown show