At last what must be the longest budget season ever is behind us. According to Rachel Reeves’ aims, it may have been considered a moderate success: markets responded relatively positively, and there were no headlines to be generated about Labour breaking its manifesto pledges not to raise the three main taxes.
At the same time, it is hardly the kind of budget that lifts a government from having the least popular prime minister and chancellor of all time to dazzling heights of popularity. The public and press reaction has still been overwhelmingly negative. Yes, through a complicated package of subtle tax increases Reeves has apparently plugged the holes in the public finances, but the sense is more one of avoiding catastrophe than sunlit uplands ahead.
The preceding weeks had seen Reeves going out to press to “roll the pitch” for breaking Labour’s manifesto pledge not to raise income tax. This would undoubtedly have been a much simpler approach than the smorgasbond of small increases that the budget ended up consisting of. It would have allowed Reeves to more convincingly promise she wouldn’t come back for more tax rises later in the parliament, without negatively impacting behaviour like the tapering of the pensions salary sacrifice policy will. And it would have avoided a confusing hodge-podge of policies which give the impression of trying to hide something, as most headlines seem to accuse them of increasing taxes on working people anyway.
It was clearly, in the end, thought unthinkable to break a manifesto promise. But I wonder if the minutiae of individual “pledges” really carry such signature importance. I’m not arguing that the broken pledges wouldn’t have mattered at all, or that they wouldn’t have been an embarrassing cudgel to beat Labour with. My argument is no broken promise is a more embarrassing cudgel than not delivering the programme of change you’ve been elected to deliver.
We have seen in recent years that if the public believes in the broad vision of a government – the big picture of what it is trying to accomplish – they can be sympathetic to sacrifices to get there.
If you take some relatively recent examples from the last 15 years, the Conservatives increased VAT in 2011 and in 2021 announced an increase in national insurance (although this was never implemented in the end). Both times they had implicitly or explicitly promised not to; neither had a significant impact on their popularity. Meanwhile, the cuts in national insurance under Rishi Sunak’s premiership didn’t suddenly restore their popularity since by this point, they were seen as a fundamentally inept administration and the tax cuts registered as little more than electoral bribes.
Meanwhile, over in the US, President Trump breaks signature pledges with wild abandon, and this has no impact on what his core supporters think of him. Farage, although not in government, gamely U-turns on promises the moment there is a pushback, such as on plans to deport vast numbers of refugees or to cut taxes by £200 billion.
I think what Trump and Farage understand is that politics does not just consist of making and delivering on a list of promises. People orientate their political choices much more around values – what they think a politician “stands for”, how they perceive their overall mission, and whether they succeed at that mission. In marketing terms, this might be called their brand.
Of course, different parties are held to different standards. Because the Conservatives are seen as the party of lower taxes, people might be more willing to believe that they implemented tax rises with extreme reluctance.
But the mere fact that Labour was elected at all suggests people bought into their offer of renewal, and arguably accepted that this might mean paying higher taxes. Starmer’s real problem is not protecting his brand, it’s that 18 months into his government, almost six years into his leadership of the Labour party, people struggle to define what that brand actually is beyond unimaginative fiscal rectitude. Trying (and failing) to cut personal independence payments seamlessly segues into removing the two-child benefit cap. One moment Starmer is calling Reform racist, the next his home secretary is unveiling the harshest changes to immigration policy in years. None of it ever coheres to any more of a narrative than somebody trying to please everyone and pleasing no one.
And so the government seems doomed to sail unsteadily on, buffeted by this wind and that, because it doesn’t have a clear waypoint it is aiming for. Nobody, when it comes to 2029, is going to vote for Starmer just because he kept a promise not to raise income tax. But they might vote against him if he breaks the one big promise to change the country.
