What Miliband's Sweden trip told us about Labour's tax policy

The Labour leader's commitment to "fairer", rather than "higher" taxes, suggests the party will not seek to significantly increase the overall tax burden.

While David Cameron visited India, Ed Miliband used the recess to make a pilgrimage to social democratic Europe. Accompanied by shadow foreign secretary Douglas Alexander and his chief consigliere Stewart Wood, Miliband held meetings with Denmark's Social Democrat prime minister Helle Thorning-Schmidt (who is married to Neil Kinnock's son, Stephen) and the leaders of Labour's Dutch and Swedish sister parties. 

Having stated that greater income equality should be an "explicit goal" of a Labour government, Miliband believes that the UK has much to learn from Sweden and Denmark, the most equal countries in the developed world. He has expressed particular admiration for Sweden's system of universal childcare, the policy credited with enabling its impressive levels of female employment. More than 80 per cent of Swedish mothers work, compared with just 67 per cent in the UK. In a nod to this achievement, Miliband tweeted during his visit: "Just arriving at Swedish Parliament building, passing two Swedish fathers with pushchairs. Scandinavian scene."

But one thing the Labour leader doesn't think we should import from the Nordic countries are their tax rates. In an interview with Bloomberg (which is worth reading in full), he said: 

There are some lessons you can learn, and some things that are different. They’ve always had a tradition of significantly higher tax and spending, which we don’t have in Britain and aren’t going to have in Britain. We’ve said that we want tax cuts for low and middle income families. That’s a sign of a fairer tax system; it’s not about higher taxes.

Miliband's words suggest that while a Labour government would increase taxes on the wealthy (as well as proposing a mansion tax, the party is considering reintroducing the 50p rate), it would not significantly increase the overall tax burden. Rather than traditional tax and spend, Miliband will look to predistributive measures such as the living wage, curbs on predatory energy and rail companies and universal childcare to combat inequality.

But the question he will need to answer is whether it is possible to fund the party's priorities -  jobs, housing, social care and childcare - without also raising taxes on middle and lower earners. If Labour goes into the 2015 election promising only to make the rich pay more, the Tories will be quick to dust down their "tax bombshell" posters. 

Ed Miliband and Swedish Social Democratic leader Stefan Lofven, visit the Royal Institute of Technology in Stockholm, Sweden. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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Who will win in Stoke-on-Trent?

Labour are the favourites, but they could fall victim to a shock in the Midlands constituency.  

The resignation of Tristram Hunt as MP for Stoke-on-Central has triggered a by-election in the safe Labour seat of Stoke on Trent Central. That had Westminster speculating about the possibility of a victory for Ukip, which only intensified once Paul Nuttall, the party’s leader, was installed as the candidate.

If Nuttall’s message that the Labour Party has lost touch with its small-town and post-industrial heartlands is going to pay dividends at the ballot box, there can hardly be a better set of circumstances than this: the sitting MP has quit to take up a well-paid job in London, and although  the overwhelming majority of Labour MPs voted to block Brexit, the well-advertised divisions in that party over the vote should help Ukip.

But Labour started with a solid lead – it is always more useful to talk about percentages, not raw vote totals – of 16 points in 2015, with the two parties of the right effectively tied in second and third place. Just 33 votes separated Ukip in second from the third-placed Conservatives.

There was a possible – but narrow – path to victory for Ukip that involved swallowing up the Conservative vote, while Labour shed votes in three directions: to the Liberal Democrats, to Ukip, and to abstention.

But as I wrote at the start of the contest, Ukip were, in my view, overwritten in their chances of winning the seat. We talk a lot about Labour’s problem appealing to “aspirational” voters in Westminster, but less covered, and equally important, is Ukip’s aspiration problem.

For some people, a vote for Ukip is effectively a declaration that you live in a dump. You can have an interesting debate about whether it was particularly sympathetic of Ken Clarke to brand that party’s voters as “elderly male people who have had disappointing lives”, but that view is not just confined to pro-European Conservatives. A great number of people, in Stoke and elsewhere, who are sympathetic to Ukip’s positions on immigration, international development and the European Union also think that voting Ukip is for losers.

That always made making inroads into the Conservative vote harder than it looks. At the risk of looking very, very foolish in six days time, I found it difficult to imagine why Tory voters in Hanley would take the risk of voting Ukip. As I wrote when Nuttall announced his candidacy, the Conservatives were, in my view, a bigger threat to Labour than Ukip.

Under Theresa May, almost every move the party has made has been designed around making inroads into the Ukip vote and that part of the Labour vote that is sympathetic to Ukip. If the polls are to be believed, she’s succeeding nationally, though even on current polling, the Conservatives wouldn’t have enough to take Stoke on Trent Central.

Now Theresa May has made a visit to the constituency. Well, seeing as the government has a comfortable majority in the House of Commons, it’s not as if the Prime Minister needs to find time to visit the seat, particularly when there is another, easier battle down the road in the shape of the West Midlands mayoral election.

But one thing is certain: the Conservatives wouldn’t be sending May down if they thought that they were going to do worse than they did in 2015.

Parties can be wrong of course. The Conservatives knew that they had found a vulnerable spot in the last election as far as a Labour deal with the SNP was concerned. They thought that vulnerable spot was worth 15 to 20 seats. They gained 27 from the Liberal Democrats and a further eight from Labour.  Labour knew they would underperform public expectations and thought they’d end up with around 260 to 280 seats. They ended up with 232.

Nevertheless, Theresa May wouldn’t be coming down to Stoke if CCHQ thought that four days later, her party was going to finish fourth. And if the Conservatives don’t collapse, anyone betting on Ukip is liable to lose their shirt. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.