September 9, 2018 / 3:26 PM / a year ago

Britain's Labour will make companies set up 'ownership funds': Observer

FILE PHOTO - Britain's Labour Party Shadow Chancellor, John McDonnell, talking on the Marr Show on BBC television in London, Britain, September 2, 2018. Jeff Overs/BBC/Handout via REUTERS

LONDON (Reuters) - Britain’s opposition Labour Party will make private companies employing more than 250 people set up “ownership funds” to give workers financial stakes in their firms if the party comes to power, its finance spokesman told the Observer newspaper.

John McDonnell said in an interview published on Sunday that he would introduce such legislation in the first year of a Labour government - part of the opposition party’s drive to “shift wealth and power in favor of working people”.

Britain is not due to hold a new election until 2022, but with Brexit rows deeply dividing the governing Conservative Party and Prime Minister Theresa May under increasing pressure, some lawmakers suggest a vote could come sooner.

“What this will ensure is that in large companies, in addition to rewarding workers with wages, they will reward them with shares that will go into a pool that will allow them to have an ownership role,” McDonnell said.

“The opportunity is there for us. I think the government will fall apart in the next six months almost certainly.”

Labour leader Jeremy Corbyn, a Socialist who was unexpectedly elected the party’s head in 2015, has moved Labour to the left, often clashing with his lawmakers in parliament but gaining thousands of new party members, often among the young.

His manifesto for the 2017 election, which promised the renationalization of some services, measures to curb corporate excess and an end to healthcare cuts, is credited with helping Labour gain seats and see the Conservatives lose their majority.

Reporting by Elizabeth Piper, editing by Louise Heavens

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