Labour conference: John McDonnell urges ‘Robin Hood tax’

“And we will pay for it not on the backs of the poor and the most vulnerable but from a fairer taxation system which lifts the burden away from middle and low-income earners and from collecting the tax lost every year to corporate tax dodgers”.

He called for an aggressive drive to prevent multinational corporations from evading taxes.

Turner says that rather than the People’s QE, he would be likely to advocate “helicopter money”, an idea first mooted by the American monetarist Milton Friedman, by which central banks create money and give it directly to consumers in the event of any future economic downturn.

Blanchflower also described Labour’s loss in the 2010 general election as “a scary day to be unemployed” and warned that George Osborne’s spending cuts could push unemployment to five million – only to see the jobless rate plummet.

According to the Robin Hood Tax Campaign, a tax of about 0.05% on transactions such as stocks, bonds, foreign currency and derivatives could raise £250bn a year globally.

“Austerity is not an economic necessity, it’s a political choice”, said Mr McDonnell.

Britain’s opposition Labour Party said on Sunday it had set up an advisory committee including Nobel Prize-winning USA economist Joseph Stiglitz and Frenchman Thomas Piketty to help develop its anti-austerity policies. We will tackle the deficit.

“Labour will oppose any attempt by the Conservative government to undermine rights at work – whether in domestic or European legislation”. The HMRC review will look at how “we maximise our tax take and at the same time it is done on a fair and just basis”, he told the fringe meeting.

But he said the party’s strategy would be based on growing the economy by strategically investing in key industries and sectors.

And he said, to loud applause: “Labour’s plan to balance the books will be aggressive”.

He said: “We will force people like Starbucks, Vodafone, Amazon and Google and all the others to pay their fair share of taxes”.

He went on: “There will be cuts to tackle the deficit but our cuts will not be the number of police officers on our streets or nurses in our hospitals or teachers in our classrooms”.

She last month signed a letter supporting so-called “Corbynomics” that branded cuts to the welfare bill shameful and the current government’s policies “extreme”.

If Labour inherits a deficit in 2020, it will pay it down “at a speed that does not put into jeopardy sustainable economic growth”, he promised.

Mr McDonnell, who referred to the party as Socialists, said: “Don’t mistake debate for division”.

He said the openness of the debate would provide “a breath of fresh air in British politics”.

“I have asked the former head of the civil service Lord Kerslake to lead a review into the functions of the Treasury”.

McDonnell also said he was in favour of the Bank of England’s independence, but that it may have to focus on more than just hitting inflation targets.

But speaking to Sky News ahead of his address to the Labour Party conference, Mr McDonnell denied he was going to introduce the Robin Hood tax.

Among those most likely to vote, 42 per cent believe the Labour leader is a danger to national and economic security – the attack lines used by the Conservatives in the wake of Mr Corbyn’s victory.