Burnham ally unveils ambitious plan to reverse decades of privatisation
Mathew Lawrence, a close ally of Andy Burnham, has published a policy paper 'The Productive State' calling for the UK government to reverse 40 years of privatisation by taking over failing utilities and creating state competitors.
A new policy blueprint titled 'The Productive State' is set to be released on Monday, outlining a strategy to reverse four decades of privatisation in the United Kingdom. The paper, authored by Mathew Lawrence, director of the thinktank Common Wealth and a close associate of Labour leader Andy Burnham, proposes a long-term plan to take control of troubled utility companies through a 'special administration regime' and issue 'bonds for shares' to acquire them.
Burnham is arriving in Westminster to be sworn in as the MP for Makerfield and is widely expected to seek to replace Keir Starmer as prime minister within weeks. The paper, published with the Labour group Mainstream—which has been the vehicle for Burnham's leadership ambitions—argues that the long trend of privatisation is at the heart of the UK's growth and productivity struggles, as loss of control over essentials has made life more expensive.
Lawrence criticises a 'privatisation premium', a hidden tax in everyday bills that transfers wealth from households to investors, forcing the government to subsidise inflated costs through welfare payments. The essay advocates for greater state intervention, not blanket nationalisation, but a framework to protect the public from soaring costs and failing private companies.
Specific proposals include stepping in when a company like Thames Water is in financial distress, using a bond-for-share exchange for financially healthy utilities (though this would require legislation and likely face legal challenges), and gradually creating public corporations that compete with private firms.
The paper has received praise from several Labour figures. Miatta Fahnbulleh, a former minister advising Burnham on policy, called it 'an important contribution to the debate on how to fix this, deliver the change that people are crying out for and start to rebuild our broken economy'. Stewart Wood, a Labour peer and former adviser to Ed Miliband, described it as a 'valuable contribution to rethinking a social-democratic case for a more active state'. Labour MP Yuan Yang, part of the soft-left Tribune group, noted a 'broad consensus within the Labour party on the need for bolder measures to tackle the cost of living crisis at its root'. Luke Hurst, national coordinator of Mainstream, emphasised that a new leadership in Labour could not be 'business as usual' and called the essay 'an urgent rethinking of Labour's political economy'.
