Brexit and the waning days of the United Kingdom

[Tamas]

PM Farage, here we come!

[Sheilbh]

Reeves was crying at PMQs?

According to Downing Street an unrelated personal matter - and obviously not nice to see.

What's really striking though is the dilemma for the government from that moment and speculation that Reeves will go. 10 year gilts rose by 4 bp (30 years up by 15 bp) and sterling fell by 1%. The markets suspect a Reeves replacement would be to the left.

Practically the u-turn on disability benefits will actually increase the deficit (marginally). And the OBR is already looking at marking down their growth forecast - basically they think they've underestimated borrowing 5 years ahead by 3% of GDP (or £100 billion - this is why I think sacralising them was such a big mistake, looking that far ahead is like determining policy by economic astrologers) which causes issues for Reeves' fiscal rules. As Pat McFadden (bookies favourite to replace her) has been saying there will likely be fiscal consequences at the next budget - probably Reeves having to u-turn on her statement in March that there wouldn't be more borrowing or more tax rises coming.

On the tax rises, it turns out on some of them the critics were right. For example on the capital gains tax increase the predictions (again from the OBR) is that will now bring in less revenue than before the change and it does seem the change on non-dom rules has had a bigger than expected impact. Underpinning all of it though are Reeves rules, the role of the OBR and her commitment to not increase taxes on "working people".

She was dealt a poor hand and has played it poorly but having said all that I think she has to go - and frankly given how they've been joined at the hip I'm not sure Reeves can fall without Starmer also going. And I increasingly think he needs to as well.

To counter the PM Farage point, fundamentally the government has a majority of 165 and four more years before the next election - but they need a leader who has some (any!) sense of politics and a better chancellor who is less inclined to accidentally setting traps for themselves. I think Rory Stewart is right that the fundamental problem is that the government isn't being radical or fast moving because Starmer doesn't believe there's deep problems/national crisis that require radicalism, instead he thinks it is simply a matter of plodding, incremental change through small steps. I think it's the wrong analysis.

I always thought the Tories by failing to resolve lots of these issues from the right were basically setting themselves up for a left-wing government to be elected and impose a left-wing solution (like Barbara Castle before Thatcher). If they don't get a grip I think Labour are making the same mistake - which is perhaps why so much of it feels just like Johnson or Sunak era governments.

[Josquius]

If it is something personal it would make a convenient escape route for her...
I expect conspiracies could fly whether it was true or not, but still, might as well use it if something bad has happened.
Unless she genuinely still thinks she can do the job? Which I suspect she might....

And for someone who doesn't think the rest is politics guys are serious you sure seem to keep up to date with them

[Sheilbh]

We won't know - and it doesn't matter. Some Labour spin doctors have said it was personal, others briefed the Times that she was upset after an argument with the Speaker over her short answers disrespecting the Commons. So the government don't really have a line yet. Not that it matters.

But I think she does still think she's right and up to the job - not to over-psychologise but I can't help but think of her pitch which was that she's a serious person who knows economics and these institutions, she worked in the BofE (which got her the Carney video endorsement), she's literally married to a senior civil servant. I don't think there's anyway she is likely to think that she's not right for the job - I think she'll view her entire career as preparing her for this job.

And she's been key for Starmer as his Shadow Chancellor since 2020 and really his person on economics. I think they're bound up. For both of them I think they have the same problem of being managed/captured by the institutions, not managing/driving those institutions to deliver their agenda (perhaps because they don't really have an "agenda" or a politics). I know I keep coming back to it but I always think about the fact that the Treasury proposed those winter fuel allowance cuts to both Gordon Brown and George Osborne who told them that was mad and not worth the political cost - which is the job of the elected, democratically accountable politician in charge of a department of civil servants.

Similarly there is a need for welfare reform - but it needs a lot of deep thinking, and persuasion (especially for a Labour government). There's a need for strong technocratic work on how the system works, where the problems are etc - which I think Liz Kendall is capable of. Instead she got a demand from the Treasury (which she fought) to cut £5 billion from her budget to make their sums add up.

[Tamas]

Sure PM Farage isn't coming for four more years but he is coming.

[Sheilbh]

I'm less fatalist

Labour have four years and a 160 majority. Their destiny is in their own hands - and the choices they make matter.

Edit: Incidentally sort of on this but also on the joined up thinking point I made across departments, the FT reporting today that the Treasury is (with the backing of business) pushing the Home Office to liberalise immigration rules for junior office jobs.

Again just to look at this - one bit of government pushing AI adoption as key (which could be right), another bit of government increasing payroll taxes (which especially affects the cost of low-wage or junior roles). As a result the number of entry level jobs fall by a third. And then government considers making it easier to obtain visas for junior roles. I don't understand what they're trying to do, or if there's no-one in government (perhaps through cabinet or PM) looking at how all of these interact - because as it stands it feels like these three ideas interact in a way that's going to have a big, negative impact for young workers and the government's just kind of sleep walking into it.

[garbon]

I'm with Jenrick () and think she should go. Humiliation for the government and then you cry in the House of Commons the next day? The narrative of endless failure writes itself.

[Sheilbh]

I agree. I'd add there's a bit of a circular firing squad going on of different spads, aides etc across government blaming each other - which doesn't seem to be getting any better. Feels like there's just not much grip at the minute.

I think the only person who came out of this with any degree of credit is Angela Rayner.

Also from the news thread I think this is why the Guardian's OMG coverage on winter fuel, to this and the fiscal rules is kind of right. It's not all totally disconnected but building up incrementally until the dam breaks in something dramatic like yesterday.

Edit: By the by - if the government want to avoid going through this again I think they should probably look at changing course on their current (Treasury-driven) plans on special education needs provision (which is another issue causing councils to go bankrupt - and, again, is in need of reform).

[Sheilbh]

Couple of interesting comments on a podcast on British politics I listen to following the disability benefit debacle.

One was that - like David Cameron - Starmer was very ruthless and not particularly graceful on his route to power. One person mentioned that they'd been doing Newsnight on the same day as Diane Abbott a few weeks ago and she is still furious about the way Starmer treated her - and it also outraged people on all wings of Labour. But also, I posted about it, but Starmer was very ruthless in getting rid of candidates and rigging the selection of candidates which should make loyalists but they noted there's lots in Labour who didn't like it and even those favoured candidates saw how easily Starmer's team were willing to push out long-standing local activists which may make them wonder about how loyal Starmer would be to them if there were any problems and therefore how loyal should they be to Starmer. Plus the general stuff about him not really doing party management.

I mention all of that because there were a few pieces (including sketches) from yesterday about how Starmer didn't really seem to react to Reeves being in obvious distress yesterday. She was literally crying next to him. Starmer was challenged on this today and apparently gave a pretty convincing answer that he was just focused on PMQs which is "bang, bang, bang". But I read one piece that noted that he asked Reeves a detail at PMQs and she reached over to point to the relevant paragraph and after it was over her sister rushed down to comfort her and Starmer turned his back and was apparently fairly ebullient with allies. Plus the Guardian having a piece today about how Starmer is personally very kind but exceptionally ruthless (I think his biographer said he's more ruthless than any recent Labour leader, including Blair) and that people around Starmer know that "everyone is expendable and no one is safe" - and I'd add his recent interviews not blaming his speechwriters but saying he hadn't written or read the speech he was apologising for. Don't know what there is to it but I just wonder if this is something that'll pick up - it reminds me a bit of the early reporting on Blair-Brown where there's hints of something a bit more that may develop.

Other point that was made that was interesting basically undermines what I argued for ages - so present it reluctantly but it might be true Basically one of the people was saying there's huge turnover of MPs so lots of new MPs and wondering if this generation are just a bit different. For example, Labour really focused on choosing candidates they could plausibly present as "local" - which means lots of councillors. I thought this would make them more biddable because they're used to being whipped - she wondered if it might mean they actually do see themselves as primarily local candidate (getting casework from elderly and disable constituents etc) and whether they just prioritise the party line less. She also noted that there's lots of "caucuses" in Labour - they're broadly speaking not ideological. Lots of them are around some specific policy issues (Labour for Growth = YIMBYs), others are regional or electoral (Labour MPs with Reform in second place) etc. Not sure - but interesting possibility.

[Sheilbh]

There we go - Zarah Sultana resigning from Labour (she'd had the whip withdrawn so sat as an independent) announcing that her and Corbyn are going to co-lead a new party:


There are suggestions that they've got some defectors from Labour lined up and I expect them to get the Gaza independents to join too.

[Tamas]

Before we judge Starmer too much on ruthlessness let's remember he had to wrestle the party back from the Corbynites.

[Admiral Yi]

  Never hurts to proofread Jeremy.

What do you mean by rigged Shelf?

[Sheilbh]

Before we judge Starmer too much on ruthlessness let's remember he had to wrestle the party back from the Corbynites.

Fair - and I don't think it's a case of judging him for being ruthless as much as noting that is a reputation he has (and deservedly so, in my view) from how he has behaved as leader. Plus I think the press are hinting at something a bit more going on.

And if you acquire a reputation of being ruthless, there are consequences (if you don't display loyalty to people when things get tough, they will repay you in kind). I'd say particularly in Starmer's case where his reputation seems to be ruthless personally and ineffective politically which seems like the worst of all worlds.

What do you mean by rigged Shelf?

It varies constituency to constituency.

Some things to flag are that the way parties select candidates are often an election before the election - which are nothing like primaries. They're broadly decided by local constituency party activists with different degrees of interference by central party HQ. There is far more interference if the election is earlier than people anticipated because often the parties will not have selected candidates in most constituencies. This was the case in 2024 when it was only six months early but there were lots of constituencies that needed candidates picking quickly.

In Labour's case central office has a lot say through regional panels and the National Executive Committee, largely because of the experience of entryism by the far left - and there are also mechanisms for deselection.

In 2024 Labour HQ was trying to get sitting MPs on the left deselected with some success - such as Lloyd Russell-Moyle and some failures like the attempt on Diane Abbott. They would also vet and present local parties with a shortlist, these would typically not include any candidates from the left and there was a particular emphasis on think tankers from the foreign policy and defence think tanks (a bit like the Tories selecting lots of nurses and teachers - it helps neutralise an attack on Labour after Corbyn). And in some cases the local party would not make the decision at all, it would instead be made by the HQ/National Executive Committee (and those elections are normally factional slates). There are also less obvious ways of queering the pitch - for example I think there's a fairly low spending limit of around £1,000 - but leadership backed campaigns had very glossy materials, videos etc (all with the same style, typography etc). There have also been allegations within Labour of the favoured candidates being given more and earlier access to the party database of local activists.

So the most extreme example is probably Smethwick where there was a left-wing candidate, Fazia Shaheen, wbo'd run in 2019 and basically been campaigning ever since. There was a three person panel from NEC who looked at her candidacy and deselected her as candidate (over the objections of the local party). The NEC then decided to select a candidate, not involving the local party and chose Gurinder Singh Josan - who was a member of the NEC who had sat on the three person panel creating the vacancy

The Tories are far less blatant and normally their way of rigging seats is to present a short list of plausible, CCHQ approved candidates to local parties in safe seats but then basically let them get on with it. Labour tend to advance the never-ending internal factional battles.

Edit: What's the proofing issue?

[Admiral Yi]

I misread. 

[Sheilbh]

Incidentally on the media piece with Tamas' point on the left-wing media turning on the government - I totally agree on the Guardian for its own reasons (and it's what it always does - it's the voice of a particular strand of the left).

But I'd just add the Mirror which is the Labour tabloid's main story on PMQs yesterday was "STARMER RATTLES KEMI: Starmer BLASTS Kemi as he defends welfare u-turn" which is maybe a story from it