Labour Party Conference: Mansion tax and tobacco firm levies to fund Ed Miliband's £2.5bn boost to NHS

Ed Miliband plans to fund his planned NHS boost through mansion tax tobacco firm levies (Getty)

Ed Miliband put the NHS at the heart of Labour’s general election campaign by promising a £2.5bn cash injection to fund the recruitment of another 36,000 health professionals.

His “world class 21st-century health and care service” would be paid for by a mansion tax, a levy on tobacco firms and closing tax loopholes exploited by hedge funds, he announced in his speech to the Labour conference in Manchester. A new “Time to Care” fund would provide 20,000 more nurses, 8,000 GPs, 5,000 care workers and 3,000 midwives.

The Labour leader said the new fund would give nurses and doctors “time to care” properly for patients and improve access to GPs so people did not end up in hospital unnecessarily.

Mr Miliband told the conference: “The NHS is sliding backwards under this Government. It is privatising and fragmenting it. It is not safe in their hands.”

Labour would raise £1.2bn by imposing a mansion tax on homes worth more than £2m, with the £2m threshold rising in line with property prices to stop more homes being dragged into the tax. There would be safeguards for people without a high income who live in an expensive property.

Mr Miliband accused tobacco firms of making “soaring profits on the back of ill health”. Labour’s proposed fees would be modelled on those introduced by US President Barack Obama in 2009. They would be based on market share and would raise at least £150m a year.

Labour would raise £1.1bn by clamping down on tax avoidance. It would stop hedge funds avoiding £500m of tax on shares by having them held by investment companies. It would close the so-called “Eurobonds loophole”, under which large firms move profits to subsidiaries based offshore to avoid corporation tax. It would also prevent “umbrella companies” avoiding tax and national insurance by exploiting rules on expenses paid to agency workers.

“Saving the NHS” was one of six goals set out by Mr Miliband in a “national mission” he said would take 10 years. The others were doubling the number of first-time buyers; ensuring as many school-leavers take up apprenticeships as go to university; halving the number of low-paid jobs; equal rights for the self-employed and creating one million jobs in green industries.