As the political parties’ campaigns for the UK General Election of 12 December continue, here we look at some of the major announcements from the parties’ manifestos, and what they mean for doing business with the public sector. All of the major parties have pledged a rise in public spending, meaning there will be an impact on business opportunities in areas with increased spending.
To learn more about what the parties’ manifesto pledges could mean for the public sector and UK business, how elections affect the number of public sector opportunities, and more about the major sources of opportunity for suppliers as we look ahead to 2020, download the latest edition of our report, ‘The Public Sector Market in 2020 and Beyond: Opportunities for Smart Suppliers to Get Ahead‘ (updated 28.11.2019). This document will continue to be updated with the latest intelligence as the situation develops.
The Conservative Party
The Conservative manifesto’s pledges are costed at an increase of £2.9bn a year by 2022. Alongside the pledge to recruit thousands more nurses for the NHS and more police officers, other policies include a £2bn fund for fixing potholes in roads. The pre-manifesto pledge to allow more borrowing for infrastructure projects has also been confirmed, with capital spend rising from £3.2bn next year to £8bn by the end of the next parliamentary session, including an aim to increase spend to make social housing more energy efficient.
The Labour Party
Labour have costed their manifesto pledges at £82.9bn. Labour have proposed a redefinition of the rules around government borrowing – considering overall ‘public sector net worth’, i.e. the value of the UK’s assets, instead of the national debt – to allow for this increased spend. For public sector workers, Labour have pledged year-on-year above-inflation pay rises, beginning with a 5% increase. Healthcare has come into focus, with the proposal of creating a new ‘National Care Service.’ Energy infrastructure and efficiency are a key area of focus, given the aim for net-zero carbon emissions by the 2030s, managed through a £250bn ‘green transformation fund.’ Labour have also announced intentions to invest in infrastructure more widely, with plans to build 150,000 social homes by the end of parliament, along with a commitment to the HS2 network, including extending it to Scotland.
The Liberal Democrats
The Liberal Democrats have also pledged a rise in public spending, costing their proposals at £63bn. Major announcements include a 1% rise in income tax, aiming to raise £7bn for the NHS and social care. The party have also announced a £130bn investment in public transport infrastructure, including a commitment to HS2, and the building of 300,000 new homes per year by 2024. Of particular interest to smaller businesses is the Liberal Democrats’ plan to replace business rates with a commercial landowner levy, applying to the overall land value of a commercial site rather than a calculation based on the buildings themselves. In addition to the previously announced ‘Skills Wallet’ of £10,000 per person for adult learning and skills training, skills shortages in the defence sector would be tackled by giving graduates in STEM (science, technology, engineering and maths) subjects one-off payments of £10,000 to become Armed Forces engineers.
The positions of the UK’s other political parties could become particularly important if no party can form a majority government. Many flagship policies revolve around sustainability and energy efficiency. The Green Party aim to reduce the UK to ‘net zero’ carbon emissions by 2030, based on £100bn of public spending into infrastructure, technology and associated jobs. Plaid Cymru have announced £15bn for a ‘Welsh Green Jobs Revolution’, while The Brexit Party have proposed that the UK no longer export any waste abroad, which would necessitate an investment in waste processing plants and associated jobs.
At the time of writing, the Scottish National Party and the Democratic Unionist Party are yet to publish their manifestos. This post will be updated as the situation develops.
But what about Brexit?
The political parties’ differing stances on the way in which the UK should leave the European Union – if at all – is not only a major policy in itself, but is claimed by several of the parties as the basis of their other spending plans. The Conservative Party would seek to implement the Withdrawal Agreement that Prime Minister Boris Johnson has previously negotiated with the EU. The party has stated that the terms of a trade deal with the EU will be negotiated in 2020, with the aim that the UK trades outside of the EU single market and any form of customs union. The Conservatives have also stated that there will be no extension to the transition period, during which time the UK remains aligned with EU rules, beyond the end of 2020.
Labour meanwhile have stated they would negotiate a new Withdrawal Agreement with the EU within three months of coming to power, then put this Agreement to a legally binding public referendum, with remaining in the EU as an alternative option. Labour’s Agreement would aim for alignment with the EU single market and a UK-wide customs agreement with the EU. The Liberal Democrats favour revoking Article 50 unilaterally, meaning the UK would remain in the EU under the same terms as previously, which the party claims would provide a £50bn ‘remain bonus.’
Read the updated edition of our latest report, ‘The Public Sector Market in 2020 and Beyond: Opportunities for Smart Suppliers to Get Ahead’, for more detail on how the parties’ election pledges will affect business with the UK public sector. The report also includes detailed data on how elections since 2015 have affected the number of public sector opportunities, the major trends that will shape public procurement in 2020 and beyond, and how smart suppliers can get ahead of their competitors over the coming months. Download your copy here.