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As the 2024 General Election approaches, the Labour Party is gearing up to present a comprehensive manifesto. Here’s a closer look at what might be included:

Economic Stability and Tax Reforms

Labour is committed to maintaining economic stability through strict fiscal rules and establishing an Office for Value for Money. This is intended to ensure efficient use of taxpayer money and reduce reliance on government consultants​ (The Independent)​​ (The Labour Party)​.

While Labour plans to scrap the non-domiciled tax status and close various tax loopholes, it has ruled out increasing income tax, capital gains tax, or corporation tax​ (The Independent)​. However, it is worth noting that Shadow Chancellor Rachel Reeves has mentioned leaving the door open to raising Capital Gains Tax (CGT) in the future if necessary to meet fiscal targets​ (LabourList)​. This potential change could have significant implications for investors.

Public Services and NHS

The manifesto will likely place an emphasis on restoring and improving public services. Key proposals include:

  • Reducing NHS waiting times with an additional two million operations and appointments in the first year.
  • Introducing a dentistry rescue plan to increase the availability of NHS dental appointments.
  • Transforming the NHS into a neighbourhood health service with local health centres offering comprehensive care​(LabourList)​.
Crime and Security

Labour plans to enhance public safety by increasing the number of police officers in communities, addressing violence against women and girls, and introducing new initiatives to prevent youth crime. The party also aims to rebuild public confidence in the criminal justice system by fast-tracking detective recruitment and enhancing the prosecution system​(LabourList)​​ (The Independent)​.

Employment and Workers’ Rights

A New Deal for Working People is expected to be a cornerstone of Labour’s manifesto. This includes:

  • Promoting trade union membership and making it easier to strike by repealing recent restrictive laws.
  • Introducing basic individual rights from day one for all workers and ensuring fair pay agreements.
  • Banning exploitative zero-hours contracts and ensuring predictable work schedules​ (Trowers & Hamlins)​.
Education and Childcare

Labour is set to focus heavily on education reforms, including:

  • Recruiting thousands of new teachers, particularly in shortage subjects.
  • Providing free breakfast clubs for all primary school children in England.
  • Reforming Ofsted and the national curriculum to enhance educational quality and creativity​ (The Independent)​​ (The Labour Party)​.
Industrial Strategy and Innovation

Labour aims to drive economic growth by:

  • Establishing an Industrial Strategy Council.
  • Investing in research and development to ensure the UK remains competitive in emerging industries.
  • Reforming business finance to support start-ups and scale-ups​ (LabourList)​.
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Environmental Policies

The Green Prosperity Plan will likely feature prominently, focusing on reducing energy bills and creating jobs in clean energy sectors through initiatives like the publicly owned Great British Energy company​ (The Labour Party)​.

Social Welfare and Pensions

Labour is expected to commit to ensuring that no pensioner lives in poverty by possibly increasing state pension payments and reintroducing the pensions lifetime allowance​ (The Independent)​.

Potential Impact on Investors

The Labour Party’s 2024 manifesto could have significant implications for investors, primarily through its proposed tax reforms, public spending initiatives, and regulatory changes.

Tax Reforms and Their Impact on Investors

While Labour has explicitly ruled out increasing income tax, capital gains tax, and corporation tax​ (The Independent)​, their focus on closing tax loopholes could still affect high earners and certain investment strategies. Key areas of interest include:

  • Non-Dom Tax Status: Labour plans to scrap the non-domiciled tax status, which could impact wealthy foreign nationals investing in the UK. This change is aimed at increasing tax revenue from individuals who currently benefit from this status​ (LabourList)​.
  • Business Rates and VAT on Private Schools: Introducing VAT and business rates for private schools could indirectly affect investors involved in the education sector by increasing operational costs and potentially reducing profitability​ (The Independent)​.
Public Spending and Infrastructure

Labour’s ambitious plans to improve public services and infrastructure could create new investment opportunities, particularly in sectors aligned with their priorities:

  • Green Energy and Infrastructure: The establishment of Great British Energy and the Green Prosperity Plan aim to reduce energy bills and create jobs in clean energy sectors. This focus on renewable energy and infrastructure development could open up significant investment avenues in green technologies and related industries​ (The Labour Party)​.
  • Housing and Urban Development: Labour’s commitment to building more homes and supporting first-time buyers might stimulate the housing market. Investors in real estate and construction could benefit from increased activity and government support for new developments​ (The Labour Party)​.
Regulatory Changes and Investor Confidence

Labour’s proposed regulatory changes could impact various sectors, potentially influencing investor confidence and market dynamics:

  • Industrial Strategy and Innovation: By establishing an Industrial Strategy Council and reforming the British Business Bank, Labour aims to support start-ups and scale-ups. Investors focusing on venture capital and innovative industries might find enhanced opportunities and support under these policies​ (LabourList)​.
  • Employment Law Reforms: The New Deal for Working People, which includes promoting fair pay agreements and improving workers’ rights, might increase operational costs for businesses. Investors should be aware of potential changes in labour costs and their impact on profit margins​ (Trowers & Hamlins)​.

Labour’s 2024 manifesto presents a mixed bag for investors. While certain tax reforms might raise concerns, the emphasis on green energy, infrastructure, and industrial innovation could provide new opportunities. Investors should closely monitor these developments to adjust their strategies accordingly, ensuring they can capitalise on the changes while mitigating potential risks.

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