How to Pay for the Reform UK Manifesto
The most common feedback I get on the doorstep is “How do you intend to pay for your promises”. On one level this truly warms my heart, to know that despite the media’s insatiable demands for the government to constantly “do more”, the British people are sensible enough to ask how these promises intend to be fulfilled. I have therefore attempted to summarise some of our most important measures below to assuage these concerns. Here are the top 10.
1) Cancel Net Zero.
Net zero is neither necessary nor is it obtainable. Even if it were obtainable it would be completely unaffordable. However the government has already committed in law to spending billions on delivering this meaningless target which will achieve absolutely nothing.
The Independent Climate Change Committee has said that “£30bn a year is needed every year for 30 years, to meet the country’s legally-binding net zero emissions commitment by 2050”
Net Zero has many different tranches, however the most immediate planned expenditure is the upgrading of the National Grid to connect Wind & Solar Farms around the UK to urban centres. This is entirely extra spending that would not be required for a strategy centred around Small Modular Reactors (SMRs) and natural gas. The cost for these upgrades is £58 Billion, including £7.5 billion for the Norwich to Tilbury line alone.
In addition, the cost of balancing the national grid with sufficient power has leapt 55% in the last 2 years. The National Grid Electricity Systems Operator (ESO) spend £7 billion on gas to fill in when renewables were not meeting demand. If we ditch the wind farms we can reduce costs for consumers and the tax payer dramatically.
2) Unleash a shale gas revolution.
Domestically produced energy in the U.K. is now at the lowest level on record. Down 65% on 1999 and 9% on 2022. This is despite the Billions we have spent on renewable energy. We now import over 40% of the energy we use. This is not what we were promised by the proponents of the so-called Green industrial revolution.
Boris Johnson said in 2020 that we would have “enough offshore wind to power every home by 2030”. He said he wanted to make the UK the “Saudi Arabia of Wind”. Those grandiose ideas have left us literally blowing in the wind, at the mercy of the international competitors for our energy supply.
North Sea oil and gas saved this country from the 1970s energy crisis. Shale gas has done the same for the USA making them a net energy exporter as of 2019. It can do the same for us.
We have 50 years of natural gas reserves which the government has refused to take advantage of. If we unleash the power of shale gas, tax revenues would soar and energy costs would fall. We would have a guaranteed source of energy during turbulent times, without the need for ordinary people to spend thousands to upgrade their existing gas boilers or pipes.
Natural Gas is clean too, it emits 30% less CO2 than oil and 50% less than coal. Liquified Natural Gas (LNG) shipped from the USA or Qatar emits 10 times the CO2 as domestic natural gas. This is because of the process of freezing gas into a liquid to transport it thousands of miles on specialised tankers.
Higher gas costs are the main reason that manufacturing has fled Germany for the last 2 years, relegating Germany to become the slowest growing economy in Europe. Simultaneously their use of coal has soared as the Green Party insisted they shut down their nuclear power plants.
Energy costs are one of the most important considerations for any manufacturing business. We therefore have an opportunity to re-build our manufacturing capabilities if we can offer cheap, reliable and clean natural gas and nuclear, in a low tax environment, with good infrastructure and an educated workforce. This is the recipe to attract manufacturing back to the UK. A growing economy is the best way to manage the cost of public services.
3) Stop paying interest on QE reserves.
We didn’t pay this interest before 2008 and the ECB has stopped paying it 3 years ago. This is printed money which was only ever created to stabilise the banking system. The idea that we should be paying interest to commercial banks, for the privilege of saving their industry, is the worst form of corporate cronyism I have seen in my lifetime.
The projected costs for interest on QE reserves is £34 billion over the next 4 years, however if the forecasts of a Great Depression by 2026 come true this figure could end up being much higher, as QE is going to have to ramp up even higher.
4) Online digital sales tax of 3%
To save the high street Reform UK proposes to scrap business rates for all small and medium sized businesses. To replace this revenue we propose an online digital sales tax of 3% for the largest online retailers like Amazon and E-Bay. This would raise £6 billion per annum.
5) Net Zero Immigration
We were told by economists for years that mass migration was going to be great for our economy. Well the results are in and in fact it was the opposite. The great mass migration experiment started in 2002 and since 2008 our productivity has flatlined. GDP per person has barely moved since then and for the last 2 years it has been falling at a time when net migration has reach record levels. Following this the institute for fiscal studies has now admitted that there is a £25 Billion black hole in funding public services due to mass migration. Reform UK policy is to reduce Net Migration to 0. That means approximately 300,000 immigrants to replace the 300,000 people leaving our shores every year, and no more.
Furthermore, as Lord Stuart Rose admitted during the Brexit campaign, lower immigration will mean higher wages for British people. When business cannot rely on cheap unskilled labour they will be encouraged to invest in automation and training to improve the productivity of the British workforce, which has lagged the G7 for some time now.
6) Cut administrative costs in the civil service.
The government estimates that returning productivity back to pre-pandemic levels and improving at the same rate as the private sector would save £20 billion over 5 years. Reform UK policy is to run the civil service like a business with cost reduction targets for every department, to reduce general admin costs without affecting front line services. There is so much waste that can be cut through investment in technology.
7) Cut the benefits bill
Over several years the benefits bill has exploded. Whilst some of this increase is genuine, much of it is fraud and some of it is over medication. In 2023 the Telegraph estimated the fraud was £5 billion a year. On top of that we have seen a massive increase in the overdiagnosis of mental health issues. Children that are even slightly bored or restless are now being diagnosed with ADHD or being “on the spectrum” of autism. This opens the door to over medication and subsequently Disability Living Allowance, followed by Personal Independence Payments when those children become adults.
We need to recognise that many of these issues would be solved by better nutrition and regular exercise rather than medication. They won’t always be solved by regular payments from the government. For these mild cases of anxiety or ADHD we need to teach our children and young people to be more resilient rather than giving up on them with a subsidy for life. As the old saying goes, “Give a man a fish and he will eat for a day. Teach a man to fish and he will feed himself for life.” The second option takes more effort but in the long run it is better for everyone.
8) Cancel Rwanda and End Hotels for Asylum Seekers
The government’s failure to control the border properly has led to £3 billion every year being spent on hotels for asylum seekers. On top of these they plan to spend £500 million on the Rwanda scheme.
Reform UK policy is to set up a new immigration task force to return all dinghies back to France and process genuine asylum claims quickly and efficiently. Once illegal migrants can see that crossing the channel illegally is impossible they will stop trying and the cost of enforcement will fall.
9) Corporation Tax Cuts raise more money and grow the economy
When the coalition government cut corporation tax the revenues actually increased. In Ireland where corporation tax is 12.5% their government raises 3 times as much corporation tax as we do. Low tax Ireland and the USA have had far higher economic growth than the UK or the EU over the last 20 years. Cutting corporation tax won’t cost a penny and it will boost economic growth if we stick with it as a long term measure.
The UK has signed up to a new global agreement for a minimum corporation tax rate of 15% however than can be reduced with capital allowances for investment, which will encourage companies to invest in automation, which will improve productivity and lower costs for everyone. A growing economy is the best way to manage the cost of public services.
10) The Land Compensation Act 1961
This last policy is a recommendation made by Liam Halligan, economist and GB News presenter, in his book “Home Truths”.
In Reform UK we are all for encouraging business with tax incentives, particularly when those businesses employer workers, and provide people with a better product or service which improves the overall quality of life. There are, however, some economic activities for which no added value was brought to bear.
Chief among these is planning permission. When a land owner is lucky enough to achieve planning permission on their land, the increase in value (known as the Hope Value) can be as much as a 20 times the value of the agricultural land. Prior to 1961 this increase in value used to be taxed 50% by the local council, who could then use those funds to build the infrastructure needed around the housing, such as flood protections, GP surgeries, better roads and drainage.
Since these funds were lost we have seen a steady deterioration in local infrastructure. No new towns have been built since the 1960s despite record population increases, which has led to unaffordable housing, cramped accommodation and a lack of infrastructure and local services.
Repealing the Land Compensation Act would transform the finances of local councils, many of whom are now facing bankruptcy.