In May 2025 I wrote an article saying Labour should call their manifesto ‘tinkering around the edges’. 3 million people used foodbanks last year. British industry is flatlining. Unemployment is rising. Long-term ill health is endemic. Support for disabled people is eroded. A fortnight ago COP30 reaffirmed our entire civilisation is in danger. And the budget – the single biggest policy bundle a government makes – fixed, well, not much.
There were two medium sized policies. First, freezing income tax thresholds. This means, after accounting for inflation, a median wage earner will pay around £300 a year more income tax and national insurance each year. So, by 2031, that’s almost £1800 a year more tax.
Labour promised no increases in National Insurance, Income Tax rates, or VAT. So, saying, “Freezing the threshold doesn’t count, you should have read the fine print,” doesn’t cut it.
Almost every serious commentator said their promise was bonkers and they would break it. I’m no fan of Rishi Sunak, but even he said in the debates that Labour would break their tax promises. That’s Ms Reeves’ ultimate indignity – proving Mr Sunak right.
We all knew after 14 years of austerity that Britain needed investment. Labour should have made the case. In July 2024 people were so sick of the Tories, they would have welcomed a bit of honesty.
The second medium-sized policy was the removal of the 2 child benefit cap. I resigned from Labour the day they adopted it. I argued against a Labour spokesperson on Newsnight. Labour were so keen to look tough on welfare, they suspended seven MPs in July 2024 for backing an amendment that would have lifted the cap.
In her budget speech Ms Reeves said, “I will not tolerate the grotesque indignity to women of the rape clause. It is dehumanising. It is cruel. Which is why I did nothing about it when I came into office a year and a half ago.” Okay, I added that last sentence.
The exceptions from the coercive and non-consensual clause affected 3,670 households to April this year. That works out at £12.8 million – no more than a rounding error in the welfare bill.
The real reason they’ve ditched the cap is the loss of voters to the Greens is worrying them. So much so that Ms Reeves tried to make a joke about Zack Polanski. She fluffed the timing, as she does with all her jokes. And, it seems, all her policies.
And why wait until April to remove it? Do it now, and give poor kids a Christmas present.
The rest of the budget was mainly stocking fillers. £18 million for playgrounds sounds a lot. But Google tells me there are 29,532 state schools in the UK. So that’s £609.51 per school. What is that going to get you? A commercial grade swing set is around £4,000 plus installation.
Imagine a different reality, where a Labour Chancellor said, “We promised to make Britain a clean energy superpower. Today, we make that a reality. We will invest in clean, cheap energy, owned by the people. It will halve bills for households, for businesses, and for industry. It will create hundreds of thousands of highly skilled jobs. And protect us from global uncertainty.”
Imagine a fifteen year plan to upgrade electricity transmission and storage. To invest in skills and training. Complete independence from global gas prices, just fixed, low-cost energy. Freeing money for everyone from hospitals to pubs to clean steel plants.
Raising the money would be easy. It would pay for itself. Clean energy generation is a productive asset that creates wealth. Renewables are cheaper than fossil fuels. The climate benefits come for free!
So why did this not happen? Businesses love investment, it creates demand, so no barrier there. You could even issue a special bond available to citizens or pension funds. The sad truth is there is not practical reason why not. It would be politically popular. Creating jobs always is. It would look strong, and like they were in control. That’s the saddest thing. The failure is because they’ve enthralled their minds to this idea that the market must fix everything and the bond markets won’t allow anything else.
As a Metro Mayor I worked with many a Tory minister who had no clarity on how to deliver their objectives. Or sometimes even what their objectives were. In reality they delivered little, but outsourced both their thinking and the contracts to well heeled private sector organisations, whose sole loyalty was to their bank accounts.
That’s why centrists always end up doing the same as the right, despite the hand-wringing. If you intend to use the same mechanisms to implement public policy, you’ll get the same results.
The government could have fixed public transport. Housing. Education. All of them generate real-world improvements in the economy, and the social and environmental benefits come for free. Instead, we got tinkering around the edges. A missed opportunity. Neither Rachel Reeves nor Keir Starmer will survive the wipe-out coming in May’s elections. This was her last chance to show some vision, and she blew it.