John McDonnell said Labour was ready to force through a radical programme of nationalisation

Shadow chancellor John McDonnell has declared that Labour is ready to fight and win a general election, sending a message to the Government: “Bring it on.”

In a keynote speech to the party’s annual conference in Liverpool, Mr McDonnell said Labour was “planned, ready and prepared” to force through a radical programme of nationalisation as soon as they entered office.

And he won loud applause as he said: “Whenever the general election comes, we are ready. Ready to campaign for victory, ready for government, ready to build the future.

“And … we’ll be proud to call that future socialism.”

In a conference that has been dominated by calls for a second referendum on Brexit, Mr McDonnell made clear again that his preference was for the issue to be decided by a general election.

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We are ready to build the future. And we’ll be proud to call that future socialism

John McDonnell

With delegates due to vote on Tuesday on a compromise motion keeping the “People’s Vote” on the table, he steered clear of the thorny issue of whether any future referendum would include the option of remaining in the EU.

The shadow chancellor indicated earlier in the day that a second referendum offered by Labour would be on the terms of any deal, rather than a re-run of the in-or-out vote of 2016.

But in his address, he said only: “We are keeping all the options open for democratic engagement.”

Mr McDonnell used his speech to set out plans for a Public and Community Ownership Unit in the Treasury to handle the planned return of water, energy, rail and the Royal Mail to public ownership.

“Let me make it absolutely clear that the full weight of the Treasury will be used to take on any vested interests that try to thwart the will of the people,” he said.

“We will drive this policy through.”

Launching a consultation on “democracy in our public services”, Mr McDonnell said a Labour government would deliver “the greatest extension of economic democratic rights that this country has ever seen”.

John McDonnell
John McDonnell’s speech was watched by Labour leader Jeremy Corbyn Credit: Peter Byrne/PA

He set out details of his plans for the water industry, which would be reorganised under new Regional Water Authorities (RWAs) made up of councillors, worker representatives and representatives of community, consumer and environmental interests.

The new system would “put this essential service back in the hands of local councils, workers and customers”, he said.

Rejecting accusations that he was reviving the economic policies of the 1970s, Mr McDonnell said: “Nationalisation will not be a return to the past.

“We don’t want to take power away from faceless directors only to centralise it all in a Whitehall office, to swap one remote manager for another.”

Mr McDonnell said there would be “unprecedented openness and transparency in how the industry will be managed”.

And he promised: “We are ending the profiteering in dividends, vast executive salaries, and excessive interest payments.

“Surpluses will be reinvested in water infrastructure and staff, or used to reduce bills. Real investment will allow the highest environmental standards.”

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LABOUR Main Credit: PA Graphics

Mr McDonnell confirmed plans to put workers on company boards and create Inclusive Ownership Funds to hand 10% of private-sector firms’ equity to employees, who stand to pocket annual dividends of up to £500.

“After decades of talking about industrial democracy, Labour in government will legislate to implement it,” he said.

And he announced plans to bring together institutions such as churches, unions and pension funds in a shareholder campaign to put pressure on companies to stop avoiding taxes.

“We’ll be demanding companies sign up to the Fair Tax Mark standards, demonstrating transparently that they pay their fair share of taxes,” said Mr McDonnell. “So the warning to the tax avoiders – the game is over. Over.”

John McDonnell
Labour leader Jeremy Corbyn applauds John McDonnell Credit: Stefan Rousseau/PA

CBI director general Carolyn Fairbairn warned that the result of Labour’s policies would be a drop in living standards for workers and customers.

“Labour must meet business halfway or they will crack the foundations of this country’s prosperity,” warned Ms Fairbairn.

“From renationalisation to dilution of shares, Labour seems determined to impose rules that display a wilful misunderstanding of business. Their policies would immediately reduce the value of shares owned by ordinary people by over 10% and hobble UK ambitions to compete on a global stage. That’s a double whammy for people’s pensions and savings.

“At a time of great uncertainty, this is no way to build the foundations of competitiveness and productivity that will improve people’s lives.”