Public ownership an economic necessity, says Labour's John McDonnell

Public ownership is not just a "political decision" but an "economic necessity", John McDonnell is due to say.

The shadow chancellor will say Labour would put democratically owned and managed public services "irreversibly in the hands of workers" so they can "never again be taken away".

And he will accuse an "intellectually bankrupt" Conservative Government of offering economic reforms which are no more than a "pale imitation" of the agenda put forward by Labour leader Jeremy Corbyn.

Mr McDonnell's comments sparked business concern, with the CBI warning that his nationalisation proposals would "wind the clock back on our economy".

Speaking at Labour's Alternative Models of Ownership conference in London on Saturday, the shadow chancellor is expected to say: "The next Labour government will put democratically owned and managed public services irreversibly in the hands of workers, and of those who rely on their work.

"We will do this not only because it's right, not only because it's the most efficient way of running them, but also because the most important protection of our public services for the long term is for everyone to have and feel ownership of them.

"We aren't going to take back control of these industries in order to put them into the hands of a remote bureaucracy, but to put them into the hands of all of you - so that they can never again be taken away.

"Public ownership is not just a political decision, it's an economic necessity.

"We'll move away from the failed privatisation model of the past, developing new democratic forms of ownership, joining other countries, regions and cities across the world in taking control of our essential services."

The CBI's managing director for people and infrastructure Neil Carberry said: "Labour's calls for nationalisation continue to miss the point. At a time when the UK must be seen more than ever as a great place to invest and create jobs, these proposals would simply wind the clock back on our economy.

"If Labour turns its back on good collaboration between the government and the private sector, public services, infrastructure and taxpayers will ultimately pay the price."

Mr McDonnell will announce the creation of a working group to look at how cooperatives can grow, expand and access capital, and to decide which sectors should be prioritised in the expansion of cooperative ownership.

He will also use the speech to accuse the Conservatives of being "intellectually bankrupt".

Mr McDonnell will say: "Under the Tories, Britain is now seriously out of step with our international partners, failing to keep up with them.

"The Conservatives are intellectually bankrupt: caught between clinging on to the failing dogmas of the past and offering a pale imitation of the radical change which Jeremy Corbyn's Labour Party now offers."

Treasury Chief Secretary Liz Truss said: "Independent reports show Labour's renationalisation plan will cost taxpayers billions and lead to worse services for people.

"Labour would put politicians in charge of running everything from the phone lines to electricity supply, meaning people have nowhere to turn when things go wrong. That didn't work last time and won't work this time."