As the Budget approaches, Westminster is full of chatter about Rachel Reeves’s decision to take the ‘smorgasbord’ approach to fiscal policy: lots of small, detailed measures, each raising only modest sums for the Treasury. Conventional wisdom says, correctly, that this is risky. Every little tweak is another opportunity for something to misfire. And when people in SW1 talk about small Budget measures going wrong, they often invoke the same cautionary tale: the pasty tax.
That was the 2012 proposal by the coalition government to impose VAT on hot takeaway food, meaning the price of a Greggs sausage roll or a service station pasty would rise by 20 per cent. The resulting Pastygate saga became a symbol of how quickly a seemingly minor fiscal change can explode into political farce.
So is Rachel Reeves heading for a string of Pastygate-style horrors at her Budget? Quite possibly. But that is also the wrong question, because this government’s pasty problem has already arrived.
This week I found myself in a London station, cold, hungry and in search of something warm. I fancied a pasty. I walked over to the kiosk, glanced at the display, and retreated empty-handed. £7.20 for a pasty. I was hungry – but not that hungry.
Food is painfully expensive at a time when Labour is in office
That £7 pasty is, I suspect, more politically significant than almost anything Reeves will announce next week. Because while the Budget will undoubtedly include measures that irritate parts of the electorate, some much bigger irritations are already hardwired into daily life. And food prices – especially convenience-food prices – are among the most potent and least discussed sources of public dissatisfaction in Britain today. When the most basic things you need to eat start costing far more than they should, it becomes easy to conclude that something in the country simply does not work.
The numbers behind that pasty illustrate the point. Today the median full-time hourly wage in Britain is £19.67. A £7 pasty therefore absorbs about a third of an hour’s work. 21 minutes’ toil for one pasty.
Go back to 2012, when George Osborne and David Cameron were getting it in the neck over Pastygate, and you could buy something similar for £2.50 to £3. At that time, the median hourly wage was £12.76 so the pasty cost less than one-fifth of an hour. 11 minutes’ work for one pasty.
Food price inflation is nasty and visible. According to the latest ONS inflation bulletin, the 12-month inflation rate for food and non-alcoholic beverages hit 4.9 per cent in October 2025, up from 4.5 per cent in September. Once again, food is getting more expensive just as Christmas is approaching.
This follows years of even more horrible figures. Between autumn 2021 and winter 2023, food price inflation never fell below 5 per cent and was often in double figures.
This matters because none of us lives in GDP. None of us experiences inflation as an abstract number. What we experience is standing in a station, looking at a £7 pasty, and thinking: bloody hell, that’s expensive. Hence ‘the cost of living’ tops the public’s list of most important political issues in pretty much every poll, and worries the life out of Labour.
Of course, a wonk could argue that food price inflation isn’t Labour’s fault – most of the rises in recent years happened under the last government, and happened because Russia invaded Ukraine. But that wonkish analysis overlooks the brutal simplicity of politics: food is painfully expensive at a time when Labour is in office, and so this is Labour’s problem. Nobody doing their Christmas shop and wincing at the price this year will feel warm and fuzzy about the way the country is going.
And this is where the politics come in. The biggest question in British politics right now is not who leads Labour or what’s in the Budget. It’s satisfaction. How happy are people with how the country works? Do they feel the system is delivering for them?
At the next election, Labour will go to the country as an incumbent party for the first time since 2010. Whatever the internal dramas, whoever is leading, Labour will be judged on its record. Its implicit argument will be straightforward: things have got a bit better, and they may get a bit better still – so don’t take a risk on change.
All the way to that election, Labour will warn that giving power to someone else, especially to Reform UK, would be dangerous. Nigel Farage, they will say, would wreck things, bring chaos. The message, echoed by ministers and sympathetic commentators alike, will be: don’t risk giving power to people who might break Britain.
There is an obvious logic to this. It is, after all, the standard playbook for any incumbent. But that £7 pasty is a reminder of how weak the 'don’t risk it' strategy may prove to be. If an electorate already feels squeezed, already feels that every weekly shop is a battle and even a greasy on-the-move lunch is a minor financial shock, then a warning about political risk may simply not land. If you tell people, 'don’t vote for Farage – he might break things,' many will reply: 'things already feel broken, so what exactly have we got to lose?'
This, more than personalities or issues, is the real fuel behind the Reform UK vote. It is also feeding the rise of the Green party, whose economic populism speaks to younger voters convinced that the system is rigged against them – and that the basics of life, from rent to groceries to a quick hot snack, cost far more than they should. So of course, the Budget and its smorgasbord are important – but in many ways, Labour's pastygate moment is already well underway.
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