Rachel Reeves: Labour’s would-be chancellor faces increased scrutiny – but are her plans just tinkering?
The woman who is odds-on to be the next chancellor has recently been painting a bleak picture of the state of Britain.
In her keynote Mais lecture last month, Rachel Reeves described Britain as gripped by “recurrent crises”, and a state of decline comparable to the turmoil of the 1970s.
The Conservatives, she has claimed, have left the NHS “on its knees” and pursued a “scorched earth” approach to public services by making an unfunded commitment to cut National Insurance.
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But as the election nears, the scrutiny is increasing on Labour’s proposed remedies and whether they go anywhere near answering the fundamental questions they have posed.
Today, visiting the Manchester Royal Infirmary, Ms Reeves set out how Labour would fund their promises of breakfast clubs in all primary schools, hundreds of thousands more dentist appointments, and two million more NHS operations, scans and appointments a year.
They had planned to find the £2bn-a-year by scrapping non-domiciled status – in other words forcing people not permanently resident in the UK to pay tax on foreign income – until the current Chancellor Jeremy Hunt came along and nicked the policy.
Ms Reeves told me she’d been through the costings; and found that £2.6bn over five years could be brought in through closing loopholes in the non-dom policy – although the Institute of Fiscal Studies warns that some non-doms, who currently pay £6bn a year in UK tax too, could move abroad.
Funding HMRC to hire new compliance officers and use better technology to bring in more money from tax evaders would, Labour says, yield £5bn in five years’ time. Governments, both Labour and the Coalition, have managed to close the so-called tax gap, but the exact numbers cannot be guaranteed.
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And is this just tinkering? The OBR forecasts at the last budget show that just to maintain the current levels of day-to-day spending over five years, the next government of whatever stripe will need to find £20bn – just to stand still.
That doesn’t include capital spending on infrastructure, which would be about the same again, or any increases Labour may wish to announce.
Ms Reeves insisted to me that she has no plans to look again at the triple lock on pensions – which currently accounts for 11% of government spending and rising. Or raise personal taxes, currently at their highest for 70 years.
She insisted today’s announcements are not small change, or a drop in the ocean. With the election date uncertain, they are understandably wary of announcing more policies the Conservatives may steal.
But Labour’s dilemma is that to turn around the bleak picture they’ve painted will demand difficult choices on tax or borrowing – and we haven’t really heard what they are yet.
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Politics
Norman Tebbit: Former Tory minister who served in Margaret Thatcher’s government dies aged 94
Norman Tebbit, the former Tory minister who served in Margaret Thatcher’s government, has died at the age of 94.
Lord Tebbit died “peacefully at home” late on Monday night, his son William confirmed.
One of Mrs Thatcher’s most loyal cabinet ministers, he was a leading political voice throughout the turbulent 1980s.
He held the posts of employment secretary, trade secretary, Chancellor of the Duchy of Lancaster and Conservative party chairman before resigning as an MP in 1992 after his wife was left disabled by the Provisional IRA’s bombing of the Grand Hotel in Brighton.
He considered standing for the Conservative leadership after Mrs Thatcher’s resignation in 1990, but was committed to taking care of his wife.
Margaret Thatcher and Norman Tebbit in 1987 after her election victory. Pic: PA
Tory leader Kemi Badenoch called him an “icon” in British politics and was “one of the leading exponents of the philosophy we now know as Thatcherism”.
“But to many of us it was the stoicism and courage he showed in the face of terrorism, which inspired us as he rebuilt his political career after suffering terrible injuries in the Brighton bomb, and cared selflessly for his wife Margaret, who was gravely disabled in the bombing,” she wrote on X.
“He never buckled under pressure and he never compromised. Our nation has lost one of its very best today and I speak for all the Conservative family and beyond in recognising Lord Tebbit’s enormous intellect and profound sense of duty to his country.
“May he rest in peace.”
Lord Tebbit and his wife Margaret stand outside the Grand Hotel in Brighton. Pic: PA
Tory grandee David Davis told Sky News Lord Tebbit was a “great working class Tory, always ready to challenge establishment conventional wisdom for the bogus nonsense it often was”.
“He was one of Thatcher’s bravest and strongest lieutenants, and a great friend,” Sir David said.
“He had to deal with the agony that the IRA visited on him and his wife, and he did so with characteristic unflinching courage. He was a great man.”
Reform leader Nigel Farage said Lord Tebbit “gave me a lot of help in my early days as an MEP”.
He was “a great man. RIP,” he added.
Lord Tebbit as employment secretary in 1983 with Mrs Thatcher. Pic: PA
Born to working-class parents in north London, he was made a life peer in 1992, where he sat until he retired in 2022.
Lord Tebbit was trade secretary when he was injured in the Provisional IRA’s bombing in Brighton during the Conservative Party conference in 1984.
Five people died in the attack and Lord Tebbit’s wife, Margaret, was left paralysed from the neck down. She died in 2020 at the age of 86.
Before entering politics, his first job, aged 16, was at the Financial Times where he had his first experience of trade unions and vowed to “break the power of the closed shop”.
He then trained as a pilot with the RAF – at one point narrowly escaping from the burning cockpit of a Meteor 8 jet – before becoming the MP for Epping in 1970 then for Chingford in 1974.
Lord Tebbit during an EU debate in the House of Lords in 1997. Pic: PA
As a cabinet minister, he was responsible for legislation that weakened the powers of the trade unions and the closed shop, making him the political embodiment of the Thatcherite ideology that was in full swing.
His tough approach was put to the test when riots erupted in Brixton, south London, against the backdrop of high rates of unemployment and mistrust between the black community and the police.
He was frequently misquoted as having told the unemployed to “get on your bike”, and was often referred to as “Onyerbike” for some time afterwards.
What he actually said was he grew up in the ’30s with an unemployed father who did not riot, “he got on his bike and looked for work, and he kept looking till he found it”.
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