Starmer has lost control of his party … and the public finances

Labour had made a mess of their fiscal policy already, but the welfare climbdown means more borrowing and more tax rises are on their way

We are led by a Prime Minister who not only does not know his own mind, but openly admits he says important, provocative things in speeches he has not read. Lest anybody think this shocking confession was a one-off, just a single moment when he was distracted by family issues, recall Starmer briefing against Sue Gray, his former chief of staff. After sacking her, Starmer blamed Gray for his discovery, “within days of entering No10,” that “there was no plan.”

Starmer clearly has no idea of what it takes to lead, and no desire to take responsibility for what happens on what we might laughably call “his watch”. This might be part of the explanation for the numerous u-turns he has performed in his first year in power – from the rape gangs inquiry to the restoration of winter fuel payments – and it is certainly a factor in the long and sorry story of the Government’s attempts to cut welfare spending.

The PM’s excuse this time is that he was too “distracted” by events in the Middle East to handle the backbench rebellion against changes to Universal Credit and Personal Independence Payments. This is weak stuff, and to understand what is really happening, we must go back to the beginning. Starmer won the leadership of the Labour Party promising everything from the restoration of European free movement rules to the nationalisation of utility companies. One of those promises was to “abolish Universal Credit and end the Tories’ cruel [benefits] sanctions regime.”

Having broken most of his promises to the Labour Party once he was elected leader, Starmer then took the same approach to the country. The broken promises on fiscal responsibility, on borrowing and on tax rises are all explained by the rank dishonesty of Labour’s promises about public spending. While their manifesto said they would limit spending increases to £9.5 billion a year by 2028/29, their Budget raised spending by £76 billion a year: eight times more than they had promised.

That this was all a preconceived deceit is obvious. Before the election, leaks from within the Labour Party set out exactly what has since come to pass. Once in power, the sources explained, Starmer and his Shadow Chancellor, Rachel Reeves, would claim that the public finances were in a worse condition than they could ever have imagined.