Updated: Mar 21
With such a massive lead in the polls, Labour don’t need a bold plan but it certainly wouldn’t hurt.
Much like Arsenal fans at the moment, Labour Party supporters across the country have been filled with hope at the prospect of their first victory in over a decade. However, unlike the gunners, who are perhaps celebrating a little prematurely, it doesn’t look like Keir Starmer’s path to number 10 is going to be met with any substantial resistance. Rishi Sunak temporarily clawed the Conservative Party out of the ‘national embarrassment’ zone, following a polling nosedive of epic proportions under Liz Truss in September. But, with Labour maintaining a stubborn 20-point lead and Conservative seat predictions resting firmly on double digits, his appointment as caretaker manager has yielded very underwhelming results.Despite this, most Labour supporters are finding it difficult to get excited about a potential decade of Starmer government, which he needs to tackle (pun intended) soon if he’s thinking about 2029; and he should be.
In the last few months, Labour have attempted to respond to this lack of enthusiasm from the core left with a range of policy gestures. I use the word gesture here because they have deemed it too early to make firm commitments and instead opted to obscure their true intentions behind a veil of ambiguity. The strategy here is to carefully feel their way around the current landscape and make adjustments according to public feedback rather than adopting hard stances at an early stage and risking alienating voters. Historically, a cautious approach to opposition has been essential for Labour and was woefully absent under Jeremy Corbyn’s leadership but in the last few months, Britain has practically turned into a second world country. With key workers striking, inflation rising and a Krakatoa recession on the horizon, the country seems to be doing a Netflix reboot of the 1978/79 Winter of Discontent. Whilst a bold vision for the party probably wouldn’t convert into further polling gains, and could even close the gap slightly, it’s certainly disappointing that Starmer is playing it safe when he has an unprecedented opportunity to lead the country into a new era.
The most prominent of these new policies has been their pledge to scrap non-dom status in a bid to “tax fairly”. Of course, the popularity of this is undisputed because who doesn’t like the idea of forcing rich foreigners to pay more taxes, especially when Sunak’s wife is one of them. A 2018 Warwick study found that non-doms had on average £560,000 in off-shore accounts that would equate to a tax bill of almost £120,000 each. The problem is that, as Labour’s approval ratings surged ahead of the Conservatives, so too did the likelihood of this policy being implemented, which has resulted in the number of new claimants falling by 40% in just the last year. The so-called ‘brain drain’ argument that raising taxes reduces revenues because people choose to move abroad has been thrown at Labour before, most notably in 2009 when Gordon Brown increased the top rate of income tax to 50%. Brown tried to fend off criticisms that it was taxation for its own sake, but the bottom line was that it increased revenues by a measly £3 billion and the abolition of non-dom status isn’t expected to do much better, even if these people choose to stay. At best, this is an optimistic economic policy that probably won’t make much difference to tax revenues. Arguably though, the notion that abolishing non-dom status is the answer to our public services crisis just isn’t true.
Another suggestion that lingered in the media for a few months was Starmer’s support for scrapping charitable status for private schools, meaning that school fees would incur VAT. Labour claim that this policy would raise £1.7 billion but this number does not take into account the displacement of students from the independent to state sector once school fees go up by 20%. It’s difficult to estimate exactly how many students this would affect but if we assume conservatively that 10% would not be able to afford such an increase, that would mean an influx of 75,000 students. With per pupil spending currently sitting at £6,600 per year, this would cost at least £490 million, which means the actual figure sits closer to £1.2 billion. This number seems pretty small when considering that the previous Labour government raised school spending on average by 5% each year, which would cost £5.8 billion to match. With 68% of the public supporting the right for parents to pay for education and only 17% opposing, this policy is also counterintuitive if Labour’s objective is to attract marginal voters. At the very least, Starmer needs to explain where the remaining £4.6 billion is going to come from but, with every other part of their campaign being so safe, it’s strange that they’ve chosen to push the boat out for private schools and not something more immediately pressing.
This general theme of avoiding the big questions continues with their proposed House of Lords reform, spearheaded by Labour’s “Commission for the UK’s future”. Produced by Brown on behalf of the party, the report argues that, at the very least, the current makeup of the upper chamber is indefensible and needs significant reform for it to be effective in scrutinising government legislation. Support for overhauling the Lords is overwhelming, with only 12% supporting it as it currently stands but, much like Brexit, finding popular alternatives has proven tricky. The biggest fear, as far as the House of Commons is concerned, is that giving more power to the Lords could create gridlock in the legislative process, which the report acknowledges. It suggests that the second chamber should not be able to affect the forming of governments, public spending plans or reject legislation and that its role should be clearly confined to amending legislation. This new proposed chamber, referred to as the “Assembly of Nations,” would be made up of elected representatives from different regions of the UK and be much smaller than the current House of Lords, which is the largest democratic chamber in the world. Whilst these kinds of policies generate interesting discussion, they serve as a distraction from the glaring issues of today, for which Labour have room to improve. Political capital is going to be extremely scarce by 2024 and devoting airtime to what is, by and large, an administrative reform isn’t going to fill voters with confidence.
For example, Labour’s energy policy would be eagerly welcomed over what the Conservatives are proposing but appears to be a victory of simplicity over efficacy. Just to recap, their plan is to freeze the energy price cap to what it was in April 2022, which would save the average household £1000 each year and is expected to cost £29 billion. This “fully costed plan” is supported by £14 billion which is already being spent on the government’s £400 discount along with an £8 billion windfall tax on wholesale oil and gas producers. The remaining £7 billion comes in the form of government interest payment savings as the policy is forecast to reduce inflation by 4%. However, closer inspection from the Institute for Fiscal Studies found that this estimation does not account for increased energy consumption during winter and would need roughly £8 billion to account for this. The plan has also been criticised for offering blanket coverage to all instead of targeting low-income households, with Utilita Energy chief exec Bill Bullen calling for a social tariff to provide long-term relief. This might not seem like a huge problem but the plan is expected to eventually cost £60 billion, which is nearly as much as the entire furlough scheme, so giving money to those who don’t need it sets a bad precedent.
By far the biggest issue Labour needs to provide an answer to is Brexit, which they have been trying to wriggle out of since June 2016. There is now a mountain of evidence to suggest that the economic impact of leaving the EU will be worse than the coronavirus pandemic and, with Britain being the worst performing country in the G20 apart from Russia, Starmer cannot keep stalling forever. Shadow Foreign Secretary David Lammy spoke recently about the direction of British foreign policy and stressed the importance of integrating with Europe but was only able to offer vague remarks about “fixing the Northern Ireland protocol” and “reducing friction” in our trading relationship, as if the Conservatives haven’t already been trying to do this. Labour’s Brexit incoherence actually stems from a strategic error made back in 2018 when they chose to vote down Theresa May’s Brexit deal, which would have kept the UK in the customs union and left the single market. This would have avoided the Irish border problem entirely and enabled frictionless trade whilst also allowing Britain to control immigration but, as Brexit secretary, Starmer opposed it in favour of a second referendum. This has backed him into a corner with the only means of escape being to perform a U-turn and admit he made a mistake. Fundamentally though, Labour hit rock bottom in 2019 largely because of their Brexit incoherence so it’s pretty baffling that they still don’t have a clear stance on what Britain’s relationship with the EU should be.
Ultimately, no number of innovative policy suggestions is going to distract from the fact that Labour have no clear vision for voters to latch onto. For many, it’s felt like the party has been aimlessly wandering around like a gap year student, trying to find its sense of meaning and purpose. We are living in a post-pandemic, post-Brexit, post-2008 financial crisis Britain and almost every aspect of the economy is hopelessly failing to meet the standards we ought to expect. After 13 years of Conservative government, we are experiencing the worst public services crisis in living memory with 4.3 million children living in poverty and 500 people dying in A&E each week. Labour need to stop telling us how bad the Conservatives have been, which we can already see with our own eyes, and instead explain why what they are proposing is better. With recent findings suggesting that millennial voters have become more left wing with age, the stage is set for Starmer to dramatically transform the UK economy. Such an opportunity may never present itself again and he would be wise not to waste it.
That being said, the choice we have as voters at this next general election still matters because, whilst the manifestos we are presented with may end up looking similar, the true intentions of both parties are very different. A Labour government with 484 seats and a genuine desire for change will transform this country for the better so thankfully there is still hope for the rest of the 2020s.