UK Elections- What the Tories and Labour are promising

British people will head to the voting booths today to vote for the next Prime Minister. On April 18, Theresa May called an early general election to strengthen her hand in Brexit negotiations.

However, over the course of her campaign, the socio-political climate of the UK has changed. Brexit negotiations have been forgotten and pushed into the background and the Prime Minister’s lead has begun to decline after the fiasco around elderly care. Then came the two terror attacks in Britain which violently pushed security issues into the picture. But what do the two main parties promise?

These are the key issues and where the two main parties stand:

Security

Theresa May- Conservatives

May pledges to create a new police force to guard important pieces of organization such as the transport network and power stations. She also vowed to spend at least 2% of GDP on defence, have a principal role in NATO, keep the current armed forces and revive the UK’s nuclear restraints. She wants to continue the investments in developing counter terrorism strategies and the country’s security services.

Jeremy Corbyn- Labour

Corbyn promises to recruit 500 more border guards, 10,000 officers and 3,000 firefighters. He wants to keep their commitments with NATO and, similar to May, spend 2% of GDP on defence and regenerate Britain’s nuclear deterrent. He also promised to lead the global nuclear disarmament efforts and potentially reduce any terrorist risks.

Brexit

This is the most crucial topic of this year’s snap elections. What Britain will do after voting to leave the EU and what happens with the Britain’s future relationships with the prime trading partners?

Theresa May- Conservatives

She will keep the EU referendum result and push the UK towards leaving the European Union. She promises to leave customs union and the single market while pursuing to form “deep and special” relationships with the EU with customs agreements and free trade. During her Brexit speech she said that “no deal is better than a bad deal” raising concerns amongst Britons.

Jeremy Corbyn- Labour

Corbyn partly agrees with the referendum result but wants to discard May’s Brexit negotiating strategy. Unlike May, his main priority is to keep the benefits of the customs union and the single market and strongly disagrees with May’s statement of “no deal” stating that this is in fact the worst possible option.

Immigration

This is a very discordant topic with the Conservatives sticking to firm targets to constrain immigration and the Labour party promising a more flexible attitude on immigration.

Theresa May- Conservatives

May promises to control and reduce immigration by double charging immigration skills to companies paying migrant employees by £2,000 on an annual basis and implement an immigration policy suitable for businesses with skill shortages.

Jeremy Corbyn- Labour

Corbyn recognizes that after Britain’s exit from the EU, free movement of European Union nationals will cease to exist but still he won’t oust immigrants out of the country. He pledges to create a tailor-made immigration system that best suits Britain’s economy. He will do that by stopping “overseas only” recruitment processes and take significant action against companies who exploit cheaper labour by migrants.

Tax

With strong dividing lines, the two main parties offer different education and health promises with varied changes on income on corporation taxes.

Theresa May- Conservatives

The Tories pledge to raise tax-free earnings allowance to £12,500 by the end of 2020 and the higher tax band to be at £50,000. She also promises to cut corporation taxes to 17% by 2020, 2% down from the current figures.

Jeremy Corbyn- Labour

On the other hand, Corbyn promises to raise corporation taxes by 2% in one year, then a further 3% raise the following year and a further 2% increase the third year. In addition, he promises to implement a 15% tax on offshore trust homes.

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Source: Bloomberg


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This article comprises the personal view and opinion of the STO Investment Research Desk and at no time should be construed as Investment Advice.

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