It’s not been a happy new year for Sir Keir Starmer. The Prime Minister’s Treasury minister Tulip Siddiq has been forced out following an anti-corruption investigation in Bangladesh. Siddiq’s job became untenable following questions over links to her aunt, the former prime minister of Bangladesh, Sheikh Hasina. Siddiq has denied wrongdoing and an independent investigation found that she had not breached the Ministerial Code, but it was clear over the weekend that Siddiq’s position was untenable. Starmer, however, bafflingly allowed to her to stay on until yesterday afternoon. ‘Starmer dithered and delayed to protect his close friend,’ says Tory leader Kemi Badenoch. It’s hard to disagree with that assessment.
Reeves’ reputation for competence is in tatters
Although Siddiq is gone, Starmer’s troubles are far from over. The PM is also facing calls to dismiss his Chancellor, Rachel Reeves. So far, Starmer is standing firm. But, following her disastrous Budget, the clouds above Reeves are swirling. It’s difficult to see how she can cling on for long.
Reeves has been Chancellor for six months, but already her reputation for competence is in tatters. Having inexplicably waited nearly four months to introduce her first Budget, she unveiled massive increases in public spending of £70 billion a year and an increase in employers’ National Insurance contributions which breached Labour’s manifesto commitment by any but the most tortuous and jesuitical measure.
Business reacted badly, aghast at the tax hike and lacking confidence that the measures announced would significantly increase productivity, while the independent Office for Budget Responsibility’s analysis concluded Reeves’s plan would “leave GDP largely unchanged in five years”. Bad news has continued, and last week the cost of government borrowing hit a 16-year high. The private sector is now said to regard the chancellor with a mixture of distrust and despair: “They don’t believe she has any idea how to fix this.”
Like Sir Geoffrey Howe, Gordon Brown and George Osborne before her, Reeves arrived at the Treasury having had years to prepare. Her qualification for the role of chancellor rested on six years as an “economist” at the Bank of England in her 20s and a sober, reassuring commitment to pursuing growth and ruling out both profligate public spending and ruinous increases in taxation. She would be one of the “grown-ups in the room”, offering the British economy expert management and stability. But even her supporters would surely concede that she has been a dismal disappointment.
In any other setting, a leader could make a rational assessment of the costs and benefits of retaining Reeves, and act accordingly. But politics does not work like that. The Prime Minister has declared that he has “full confidence” in his Chancellor, who is doing a “fantastic job”. But, then again, his initial response was to commend Siddiq, his constituency neighbour in north London, for acting “entirely properly” in submitting to scrutiny. In other words, his default response to these crises is unstinting support and defence.
Prime Ministers see challenges to ministerial careers primarily as tests of strength. If the Opposition calls for a minister to resign, as the Conservatives did with Tulip Siddiq, then the instinctive response is immediate counter-offensive. This is not a new dynamic: it was displayed by John Major in the 1990s and Tony Blair after him, but it is not necessarily a successful tactic. The departures of David Mellor, Tim Yeo, David Willetts, Peter Mandelson, David Blunkett and others are testament to that.
The truth is that Starmer, like his predecessors, has painted himself into a corner. Reeves may remain in office, and the current brouhaha may pass out of the political memory. If, however, she is forced to step down, then blame will attach to the prime minister. Did he make a mistake in selecting her, and, once appointed, did he display poor judgement in defending Reeves? It leaves him with no downside-free options.
If he really wanted to conduct government in a new and serious-minded way, Sir Keir Starmer would ask himself profound questions: has Reeves delivered prosperity or improved economic prospects in six months as chancellor? Does she understand the causes of Britain’s current underperformance? Is there any reason to think her credibility or reputation will improve in the next six months? And are there better candidates available to manage the economy? (No, no, no and yes, I would suggest.)
This all fits into a wearying narrative of unironic political machismo: tough choices, difficult decisions, staying the course, taking on the challenge, ruthless and laser-like focus. Ministers seem to believe that determination, even if taken to mulish levels, is somehow inherently a virtue, unable to grasp that dedication in pursuit of the wrong policies is both damaging and arrogant.
Instead we have an expert Chancellor whose expertise seems to have been at least exaggerated, and an anti-corruption minister under investigation for financial misdeeds. Presiding over this embarrassment is a prime minister locked in a battle of wills which robs him of perspective and autonomy. Starmer’s “mission of national renewal” sounds hollow now.
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