Starmer’s Doom and Gloom Risks Eclipsing Labour Message of Hope
(Bloomberg) -- Keir Starmer faces growing doubts among senior Labour politicians about his administration’s gloomy messaging, after calculated interventions bookending the parliamentary recess focused on the UK’s ailing public finances and the tough measures needed to fix them.
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Just before Members of Parliament headed into their summer break, Chancellor of the Exchequer Rachel Reeves signaled taxes will have to rise to fill an unexpectedly large fiscal black hole of £22 billion ($29 billion) left by the previous Conservative government. Just 6 days before MPs return, Starmer warned “things will get worse” before they improve, as his administration grapples with the budgetary void. Rounding out a challenging first two months in office for the premier, Britain was hit by days of far-right rioting between the two speeches.
The danger for Starmer is the focus on tough decisions and fiscal rigor risks drowning out the positive message of a party returning to power in a landslide election win after 14 years out of office with a program to improve the lives of working people.
With optimism in short supply, the first rumblings of dissent are already surfacing ahead of Parliament’s return next week. In conversations with Bloomberg, these aides, backbench MPs and ministers — even some in cabinet — questioned whether Downing Street needs to better calibrate its message to highlight plans to turn the country around, rather than risk an overly negative approach that distracts from Labour’s own policies. Otherwise, there’s a danger that the party’s annual conference in three weeks will be dominated by rows about the budget, according to the people, who asked not to be named discussing their private views.
Polling suggests more positivity may be needed. New Gallup data collected during the election and shared with Bloomberg found that Britons were more pessimistic about their economic futures than during the 2009 financial crisis. Some 62% said the economy was getting worse where they lived, compared to just 19% who said it was improving. And a majority of Brits already have a negative view of the new government, according to a YouGov survey released this week.
Starmer is live to the danger.
“This is actually a project of hope,” he told reporters traveling with him to Germany. “But it’s got to start with the hard yards of doing the difficult stuff, of clearing out the rot first.”
Those tough calls are likely to crystallize on Oct. 30, when Reeves delivers her first budget. The doom and gloom camp, as one Labour lawmaker described it, is led by the chancellor, who’s determined to hammer home to the public that she’s been handed a woeful budgetary inheritance by the Tories.
“Many of the same problems that led to the Labour Party’s landslide win in the British election in July are now theirs to solve,” said Benedict Vigers at Gallup.
Reeves’s strategy is seen internally as an extension of the electoral tactics deployed by Starmer’s top aide Morgan McSweeney: a cautious approach to spending and a focus on the political turmoil wrought by the Conservatives. The chancellor views the rhetoric as necessary to show she has no choice but to make unpopular calls, people said.
Starmer is fully signed up to that approach and believes the public want politicians to be up-front with them rather than deploy the false boosterism of former prime minister Boris Johnson, people familiar with his thinking said.
Labour strategists see getting the least popular decisions out of the way early on in the administration as sensible politics. The premier’s allies argue one of his strengths has been choosing a strategy and sticking to it no matter the criticism or distractions, a virtue they see as vindicated by the election win.
“Over the weeks ahead we’ll hear more about not just the tough decisions needed but also the journey the government is embarking on,” Jonathan Ashworth, chief executive of the pro-Starmer Labour Together think tank, said. Starmer could adopt an argument of “prudence for prosperity,” he added.
Others in Labour are unsure. Some lawmakers say Number 10 has given disproportionate airtime to fiscal woes and not enough to conjuring a positive narrative about the government’s first 100 days, from restoring mandatory housing targets and agreeing National Health Service pay deals to unveiling legislation centered around Starmer’s so-called ‘missions’ to improve the country.
There are also concerns that the negativity will only worsen political disillusionment. This argument is seen as an extension of a pre-election clash some MPs had with Starmer and Reeves, who they dubbed the “no machine” for lacking ambition and blocking new policies and spending.
Some early decisions have already proved controversial, and none more so than Reeves’s surprise decision to remove winter fuel payments from pensioners. Some Treasury officials had doubts over the politics of the policy beforehand, but Reeves insisted it was necessary to help balance the books, people familiar with the matter said. But the decision to means-test the benefit landed worse than expected, leading to efforts to mitigate the impact without conducting a full-scale U-turn.
Others describe early evidence of hubris by Downing Street in making a series of quick decisions after winning power without thinking them through. They cite a recent cronyism row involving civil service appointments and a government pass awarded to a donor.
Further policy concerns cited by Labour MPs include Reeves’s orders for departments to find billions of pounds in savings, scrapping a cap on self-funded social care spending without a policy to replace it, and a lack of plans to abolish a policy limiting child benefit to a family’s first two children.
There are also fears among lawmakers that the chancellor may raise taxes that don’t just hit the rich, such as fuel duty, while the biggest concern is she will say she has to implement welfare cuts. Some MPs feel Reeves boxed herself in by promising to keep in place Tory cuts to the national insurance payroll tax, saying she could have avoided a lot of pain elsewhere by reversing them.
One lawmaker said they saw the problem as Starmer letting Reeves run the show on the economy, without the premier having an overarching positive political story to tell.
“Everybody in Britain is willing to sacrifice for a purpose,” said John McTernan, a former adviser to Tony Blair and strategist for BCW Global. “What’s going to get better is the bit that needs to be vividly brought to life.”
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