Key Takeaways:
- Labour MPs are reportedly blaming Rachel Reeves for the Government’s problems despite her recent Budget announcement
- Reeves announced the lifting of the two child benefit cap, extra levies on online gambling, and a mansion tax to appease backbenchers
- The Chancellor’s decision to scrap the winter fuel payment last year is seen as a major mistake that has hurt the Government’s popularity
- Reeves’s fortunes are linked to those of Prime Minister Sir Keir Starmer, and her removal could threaten his position
- The prime minister’s ethics tsar has decided not to investigate Reeves over her handling of the Budget
Introduction to the Situation
The Labour Party is facing internal criticism, with some MPs blaming Chancellor Rachel Reeves for the Government’s current problems. Despite her recent Budget announcement, which included measures such as lifting the two child benefit cap, introducing extra levies on online gambling, and implementing a mansion tax, Reeves is facing backlash from her own party. These measures were designed to appease backbenchers who had rebelled against the Government’s attempt to cut the welfare bill in the summer. However, critics suggest that the Chancellor’s efforts have not been enough to address the party’s underlying issues.
The Budget Announcement
Reeves’s Budget announcement was seen as an attempt to address some of the concerns of Labour backbenchers, who had been critical of the Government’s handling of the economy. The decision to lift the two child benefit cap, in particular, was welcomed by many as a positive step towards supporting low-income families. Additionally, the introduction of extra levies on online gambling and a mansion tax were seen as efforts to address issues of fairness and equality. However, despite these measures, the Chancellor’s announcement was not enough to quell the criticism from within her own party.
Criticism from Labour MPs
One Labour MP described the situation as a "tragedy", suggesting that Reeves’s latest financial plans included "some great things" that "will genuinely help". However, the MP also stated that the Chancellor’s "absolute original sin" was the decision to scrap the winter fuel payment last year, which "killed any honeymoon we might have had". This decision is seen as a major mistake that has hurt the Government’s popularity and damaged its relationship with its core supporters. The MP also suggested that Reeves’s fortunes are linked to those of Prime Minister Sir Keir Starmer, and that her removal could threaten his position.
Allegations of Ministerial Misconduct
Reform UK leader Nigel Farage had called for an investigation into Reeves’s handling of the Budget, alleging that she may have broken the ministerial code by talking down the state of the public finances after receiving preliminary forecasts from the Office for Budget Responsibility (OBR). However, the prime minister’s ethics tsar, Sir Laurie Magnus, has informed Farage that there will not be an investigation. This decision has been seen as a boost to Reeves, who had been facing criticism from within her own party and from opposition leaders.
Prime Minister’s Response
During Prime Minister’s Questions, Sir Keir Starmer defended his Chancellor and the Government’s Budget announcement. When asked by Conservative leader Kemi Badenoch whether the person at the top should resign when an organization descends into "total shambles", Starmer replied that he was proud to lead the Labour Party and that the Budget had set out a clear plan to protect the NHS, create economic stability, and address the cost of living. Starmer’s response was seen as a show of support for Reeves, and an attempt to deflect criticism from the Government’s handling of the economy.
Conclusion and Future Prospects
The Labour Party is facing a challenging time, with internal criticism and external pressure mounting. Despite Reeves’s efforts to address some of the concerns of backbenchers, the Chancellor’s popularity remains low, and her position is seen as precarious. The decision by the prime minister’s ethics tsar not to investigate her handling of the Budget has provided some relief, but the party’s underlying issues remain. As the Government continues to face criticism and pressure, it remains to be seen whether Reeves will be able to regain the trust of her party and the public, or whether her position will become increasingly untenable.
