14 March 2025 - 1:00pm
Keir Starmer is facing perhaps the biggest rebellion of his short time in office. The Labour leadership is currently in schmoozing mode, trying to win over rebels who oppose planned cuts to disability benefits. It’s rumoured that dozens of MPs are aghast at the situation, both on the established Labour Left and among newer, more loyal members. How Labour handles it could be critical for the long-term position of the party.
Appeasing the rebels might be hard, and the Government knows it has limited fiscal wiggle room. It was already struggling to raise public spending and improve services, a problem compounded by the perceived need for more defence spending. Tax rises of the sort needed would be hugely unpopular, and Britain would struggle to afford more borrowing. Cuts have to come from somewhere.
Starmer is making a strategic decision to pass them on to benefits, and disability benefits in particular. It is typical of his leadership, which seems haunted by voters’ worst stereotypes about Labour. Starmer is always worried that his party will be perceived as too high-spending or a soft touch on those unable or unwilling to work. This seems to drive his political decisions, as he always takes the route which is least likely to result in these sorts of allegations.
The Prime Minister does not want to face the traditional Tory attacks about Labour’s economic record. When combined with his moves on tax, his decision on cuts looks like a concerted effort to spare the average worker from the costs of increased spending. He’s opening himself up on the Left flank to keep this going.
This might not be sustainable for Starmer. Part of the oddness of last year’s election was the narrowness of Labour’s wins in its heartlands. In inner-city seats, the party’s vote plummeted, going not to the Right but to the Left. This benefitted the Greens and a range of independents. Though this was partly driven by Gaza, those smaller parties will be looking to exploit economic differences with Labour next time around. Moves like this could give them ammunition.
Labour also has to think about how this will affect Reform UK voters. The general trend is to see Reform, which remains broadly Thatcherite in its economics, as hawkish on benefits. But many of the seats where the party polls well are also ones with the highest rates of disability claimants. Cutting them could fuel further disillusionment in places like Blackpool and Merthyr Tydfil, on which Reform may capitalise.
In the short term, however, the biggest problem for Starmer might be internal. Once people have rebelled for the first time, they tend to find it an easier line to cross. Despite a big majority, a showdown now could seed the sort of dissent that makes getting anything done much more of a slog. More time will have to be devoted to parliamentary management; and blocs of opposition could solidify, expanding beyond the usual suspects on the Left. It could become a drag on everything he wants to do.
Fiscally, Starmer has little room for manoeuvre. But you always have a choice on who you take the fight to. He has his reasons for seeing benefits as the easiest thing, politically, to cut. It is not risk-free, however, and going against a key part of the Labour constituency could have serious ramifications for the PM in terms of both party management and electoral success.
John Oxley is a corporate strategist and political commentator. His Substack is Joxley Writes.
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