The Green Credibility Gap — How our GE2024 manifesto fell short
At our first Party Conference since a genuine breakthrough election campaign, it’s important that we learn the right lessons so that we can progress even further in the years to come.
This article focuses on the finance and spending measures announced in our 2024 General Election manifesto and how they give us an opportunity to learn and grow.
Let’s start on a positive note: Our overall message to voters on the economy was the right one. We needed to:
- invest in our public services and infrastructure in order to reach net zero any time soon and reinvigorate our economy
- redistribute income and wealth to make our society fairer and our economy more robust
At a time when all the other parties were calling for the expansion of the failed neo-liberal experiment with more austerity, mass inequality and continued underinvestment across the board, we struck a real cord with millions of voters by pointing out an alternative path.
However, beyond that headline it is also true that the tax, borrowing and spending figures from the manifesto simply didn’t add up.
More than that, the narrative around our fiscal proposals was mostly either incomplete or missing entirely.
There isn’t the space here to do a line-by-line review, but let’s identify just a few of the most obvious mistakes, gaps and oddities.
Our own numbers often didn’t make any sense or were missing completely:
- On page 29 we listed over £16bn of day-to-day education spending increases per year (I’ve had to assume some of the commitments are capital investment, but that’s not made clear). Then on p.45 we summarise the costs of our Education proposals as £13.6bn by 2030. With no explanation of the two different numbers
- We mix annual increases with total increases across the 5 years of a parliament throughout the document, often without clarifying which is which.We also conflate investment spending with day-to-day spending (sometimes even calling the latter ‘investment’). This makes it very difficult to compare or check any of the figures
- We commit to ‘the restoration of grants and abolition of tuition fees’ without including any costs at all. This proposal could amount to as much as £20bn per year, but the reader is simply left guessing.
- Same with the extension of free childcare. There is no mention of the fiscal impact of this policy, or any specific details at all. But any meaningful expansion at all is likely to cost in the region of £5-£10bn
- We included costings for halving student loan interest, but make no such commitment in the manifesto
- We commit to £54bn of new day-to-day health and social care spending on pages 2–5, but by p.45 that becomes £52.9bn. A minor discrepancy, but confusing nonetheless
- Our commitments to increase a range of means-tested benefits, while also removing cruel conditions and sanctions, would cost around £20bn per year, but for unknown reasons, we decide this will cost over £29bn (again with no explanation or breakdown)
- Our overseas aid (including climate finance) would amount to an annual spending increase of about £47bn by 2033, but our estimates of the cost of this are just an additional £24bn by 2030. Does this mean a massive leap of £23bn between 2030 and 2033? We don’t say, so who knows?
- Perhaps the most harmful omission is the absence of any attempt to quantify the significant returns on much of this spending. Lower poverty, greater employment and learning, reduced cost in other areas to government, higher educational attainment and attendance, better health outcomes, lower crime rates, and higher tax revenues elsewhere are barely mentioned. These are the clear economic and financial benefits of many of our policies, but without identifying or mentioning them, voters might be forgiven for assuming that they don’t exist.
Our revenue raising figures are slightly less confusing. A kind assessment would describe them as optimistic. To the hard-headed, they might seem naive.
Tax commentator Dan Neidle gives a (mostly) reasonable critique in this Twitter thread, but the main criticism is really that there is too little detail to help create any meaningful analysis. Neidle is a Labour Party member, but let’s not be too tribal. He is openly supportive of many of our policy objectives and on this occasion many of his criticisms were fair.
While radical tax policies will always face challenges on implementation, the reality is that our flagship taxation policy in 2024 didn’t stand up to scrutiny.
The much quoted ‘Wealth Tax’ was thrown into the political arena by all our leaders and spokespeople with impressive regularity (we achieved some message discipline with it at least!).
While it is perfectly possible to tax income from wealth (assets) more in line with income from work (other countries do it without much trouble), that doesn’t mean to say there aren’t serious challenges, or that it necessarily brings in the claimed amounts of revenue. Our tendency to pick a very big number and then cling to it in the face of all the evidence does not help increase our credibility with sceptical voters on the issue.
However, the main problem for our credibility comes from the specific policy to tax the value of assets of the ‘super-rich’ (those worth over £10m). We claimed this would bring in £15bn extra per year. This figure started at around £70bn in 2023, was revised down to £33bn after months of internal discussion, and then finally slashed again to the £15bn we see in the manifesto after consistent challenge (not least from me). The reality is that we would be lucky if it raised anything at all, but £5bn would be a more realistic figure (and that would come with a host of complications).
The evidence of other countries (most of whom levy the tax on many more people than we were proposing), is that it raises very little. The experience of France was that it reduced revenues by EUR2 for every EUR1 that it raised. The reduced take take was due to capital flight and the corresponding reduction in revenues from other taxes on capital. The last time the UK tried it in the 1970s, the Labour government eventually gave up, concluding that it would cost more to implement than it would raise. Only Switzerland raises this level of revenue from their wealth tax, but that’s only because it applies to everyone, not just the ‘super rich’, and the bulk of the ‘wealth’ that is successfully taxed is land (a much more effective way to tax wealth that is Green Party policy, but was given barely a passing mention in the manifesto).
The reality is that this tax simply won’t raise the revenue we claim it will. No amount of rhetoric on our part will change that.
Underneath all of this policy wonkery and creative accounting lies an inescapable truth that the party must embrace if it is ever to be viewed as credible on fiscal matters: There is no way to generate the level of increases in tax revenues that we are arguing for without impacting people and households on ordinary incomes.
We seemed to concede that fact in some of the manifesto detail (though not in our wider messaging), with increases in National Insurance and reductions in pension contribution rebates for people earning over £50k. The reality is that most of our income tax increases would have fallen on the moderately affluent, and not the ‘super rich’. In London and the South East, many of these people would be considered average professionals, who would have been landed with effective marginal tax rates of up to 67% under our plans.
And our Carbon Tax proposal would have had an impact on all consumers, right down to the very poorest. Our formal policy is to use the bulk of revenue from any Carbon Tax as a dividend, which would leave the poorest 40% (roughly) of households financially better off, with the next 40% coming out about even and only the top 20% experiencing a net increase in costs compared to income. But that bit was omitted from the manifesto, meaning the proposal became regressive on a scale that would be very difficult to justify politically, and very damaging socially. As it stood, it would have been mostly used on day-to-day social spending (not reducing carbon emissions) and would have reduced the available income of millions of low income households.
The Carbon Tax proposal also assumes we would impose the tax on UK exports. This is not how effective Carbon Taxes work. In the absence of other countries introducing either their own domestic Carbon Taxes or ‘Border Adjustment’ regimes, this would simply increase the price of UK exports, making them uncompetitive. This wouldn’t reduce emissions; it would just push demand to the exports of other countries who had no carbon tax. Reducing UK exports to affect zero reduction in emissions is not good policy. It also would reduce economic activity and therefore tax revenues in a way that we have not considered in this manifesto.
But here’s the hard question for those of us who have sought to make the party’s fiscal and economic policy credible: does it matter?
Did many voters or commentators care about the financial holes in our manifesto?
Nobody expected us to be in a position to implement these policies. So, was it not better to signal our broader intent to make the rich pay their fair share, while pushing for more investment in public infrastructure and services, while ignoring the details?
Did anyone even notice that we slashed our commitments to net zero investment, by 75% compared to 2019? That would see UK carbon emissions fall by less than 20% over the next decade. That outcome represents an environmental catastrophe, but I can’t recall us being challenged on it, even once.
Similarly there seemed to be no blowback on our downgrading of core commitments like abolishing student debt or providing universal free childcare. Were we, therefore, right to avoid the fiscal and environmental detail and focus on our core messages around social spending?
Perhaps. The election result seemed to suggest that those 1 million extra voters who supported the Green Party this time needed to hear those headline messages, regardless of the accuracy of the details.
But credibility and messages that resonate with our target audience should not be mutually exclusive. It is our challenge to marry the two.
It is true that Labour and Conservative manifestos alike were extremely light on financial detail and wholly unrealistic (for different reasons). The cynicism that inspired in voters is not something we want to harvest for ourselves the coming years.
The next stage of the Party’s growth will require us to engage a whole new group of people who maybe have a higher bar when it comes to being convinced about our plans.
We know from our own research that one of the main reasons that Green-leaning voters do not vote Green is that they doubt our credibility on economic and financial matters. If we really want to go mainstream in the next few years and establish ourselves as a central force in British politics, we will need proposals whose costings stand up to scrutiny, or at the very least add up.
Martin Farley is a member of Brighton & Hove Green Party and a former chair of the Green Party’s Tax & Fiscal Policy Working Group.
