Labour's green spokesman defies leader

Michael Meacher proposes higher taxes on the rich and ballots on directors' pay
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Political Correspondent

Michael Meacher, newly promoted as Labour spokesman on green issues, has called for higher taxes on the rich, and for workforces to be given a vote on company directors' pay.

The public expression of his views, in an interview with The Independent, cuts across Tony Blair's tax-cutting, non-interventionist message to business leaders earlier this week.

Ballots of employees on their directors' pay are "an idea that should be considered", he said. Taking up Mr Blair's desire to create a "stakeholder economy", he said: "If we have a stakeholder concept, employees are clearly major stakeholders. All that I'm saying is that that interest ought somehow to be reflected in the decision-making. And I certainly think that the balance of pay between top and bottom is something in which they do legitimately have a say."

Mr Meacher claimed that "the Government itself feels that a good deal of this top pay is absolutely abhorrent and excessive" and, asked if society should signal its disapproval by higher taxes which "soak the rich", he said: "I certainly think we should consider it."

Mr Blair has ruled out any implications for company law of his "stakeholder" vision, and last weekend said he had no intention of "soaking the rich".

Mr Meacher said: "Tax is the most sensitive word. Even to utter the word is a risk, as we've seen." (An an oblique reference to the fate of Clare Short, his Shadow Cabinet colleague demoted this summer for saying people on MPs' incomes should pay more tax.)

In a wide-ranging interview on his new portfolio, Mr Meacher refused to back down in his dogfight over water quality with Sir Desmond Pitcher, the pounds 310,000-a-year boss of North West Water.

Sir Desmond, who took out advertisements attacking Mr Meacher in the national press last week, is Labour's number one privatised utility "fat cat".

Mr Meacher said he would not bathe in the sea at Blackpool, and challenged Sir Desmond and John Gummer, Secretary of State for the Environment, to take a running jump off the pier. "Will Sir Desmond Pitcher join John Gummer in a swim through the water?" he asked.

He said Labour is certainly "more naturally green" than the Tories, because "we don't have these huge, in-built vested interests, either in favour of roads or in favour of market forces. We are far more willing to look at consequences, and far more willing to regulate".

He denied using green issues to reassert Labour's traditional instinct for state regulation. He also rejected the notion that he is out of tune with New Labour, saying: "I'm grossly stereotyped, and I would be grateful if you could take me for what I am and for what you find me to be." One of the longest-serving members of the Shadow Cabinet, Mr Meacher was first elected when he failed to win the deputy Labour leadership as Tony Benn's "disciple on earth" in 1983.

He stood by the proposals he made in his 1992 book Diffusing Power, which was published with the approval of the late John Smith before he was elected leader, but which will be regarded with suspicion by "New" Labour.

As well as saying that richer nations might have to contribute to a pounds 200bn fund to tackle global warming, they include a 75 per cent tax rate on incomes above pounds 100,000 a year and giving one-third of the votes at company annual general meetings to employees.

He told The Independent the ideas in his book are "only suggestions for dealing with what are quite difficult problems. Inequality has polarised to such a huge degree, back to the Edwardian or Victorian era."

As for richer nations having to foot poorer countries' bills for cutting the emissions that cause global warming, he said: "If we want a cleaner world and if we are affected by what they do, then we've got to help them."

He said he will be "pressing very strongly" for Environmental Protection to be a separate government department if Labour wins the election.

Although many green objectives do not need big public-spending increases, he added that a Labour government could spend an extra pounds 8bn a year on "public investment" without putting up taxes.

In a calculation which might alarm Gordon Brown, the shadow Chancellor, who says Labour would keep a tight grip on public spending, Mr Meacher said that, if the economy grew at 2.5 per cent a year, it would produce about pounds 8bn every year in extra tax revenue, "without any increase in taxes".

Threat to high earners, page 17