All the important thing challenges Keir Starmer faces as he warns of ‘unpopular choices’

Keir Starmer is set to warn his new Government won’t shy away from more “unpopular” decisions as he uses a major speech to blame the rubble and ruin left by the Tories.

Just a week before MPs return from the summer recess, the PM will speak to the country from No10 rose garden and claim: “Things are worse than we ever imagined”. He will say: “When there is rot deep in the heart of a structure, you can’t just cover it up. You can’t tinker with it or rely on quick fixes. You have to overhaul the entire thing. Tackle it at the root. Even if it’s harder work and takes more time.

The gloomy speech comes as the new Labour government faces a backlash over the decision to remove universal winter fuel payments for pensioners. But Mr Starmer will add: “I won’t shy away from making unpopular decisions now if it’s the right thing for the country in the long term.”

Here The Mirror looks at some of the biggest challenges facing Mr Starmer as MPs prepare to make a return to the Commons after the summer recess.

Economy and first Labour Budget

Just before the summer recess the Chancellor Rachel Reeves accused the Tories of running up a £22billion black hole in public finances – and has warned of difficult decisions to come. Figures last week also showed government borrowing hit £3.1billion last month – almost £2billion higher than a year ago and the highest July since 2021.

The Chancellor will unveil her plans at Labour’s first Budget in over 14 years on October 30 – a pivotal moment for Keir Starmer’s new Government. Facing pressure not to slash stretched departmental budgets, Ms Reeves has already suggested it is likely she will have to raise taxes. Questions on the future of capital gains and inheritance tax have repeatedly been swerved by government ministers.

Labour’s manifesto ruled out increasing taxes on “working people”, which the party explicitly said included national insurance, income tax, or VAT.

Addressing the economy in his big speech, Mr Starmer will say: “‘Things are worse than we ever imagined. In the first few weeks, we discovered a £22 billion black hole in the public finances. And don’t let anyone say that this is performative, or playing politics.”

Pressure over winter fuel payments and benefits

The Chancellor last month unveiled the “difficult decision” to axe winter fuel payments for around 10million pensioners. Instead, only OAPs on means-tested benefits or pension credit will receive the support – worth up to £300-a-year.

The backlash is intensifying after Ofgem announced last week energy bills will rise for millions of people this winter, with the average household set to see their annual bill rise from £1,568 to £1,717 a year. As MPs return to the Commons next week, expect pressure to ramp up on the Government to scale back the cut – or scrap it altogether.

Expect the Government to also continue facing pressure over the two-child benefit limit – an austerity-era policy blamed for pushing thousands of kids into poverty. Last month Mr Starmer removed the whip from seven Labour MPs who rebelled on the issue.

In an attempt to ease tensions over the policy, ministers have launched the child poverty taskforce, which is expected to report back in Spring 2025.

Rescuing NHS and fixing social care

The Government must pick up the pieces after years of social care failures. Stark figures show that patients are languishing in hospital for weeks because of delays providing the care they need. This is causing a huge knock-on effect for the NHS.

In 2019 Boris Johnson promised to deliver a plan to finally fix the care sector, but failed to do so. Professor Martin Green, chief executive of Care England – which providers across the country said the system is “failing and will only get worse unless remedial action is taken”.

Labour has vowed to create a new National Care Service to tackle pressure on the NHS by ensuring swifter discharges.

A Government spokesman said: “Our broken NHS hospital discharge system is blocked by an inadequate and neglected social care system. This Government is committed to reforming the adult social care sector and building a National Care Service to deliver high-quality care across the country and ease pressure on the NHS so it is fit for the future.”

Latest NHS figures, for July, show that across England an average of 22,310 hospital patients a day were ready to be discharged. Of these, a total of 9,984 (45%) were discharged and 12,326 (55%) were not – although not all of them required care services. The proportion of medically fit patients who were discharged varied massively between regions.

Conflicts in Ukraine and Middle East

Escalating tensions in the Middle East with fears of an all-out conflict in the region and Russia’s ongoing invasion of Ukraine are top of the new Government’s inbox.

Foreign Secretary David Lammy has already visited the Middle East on several occasions amid intense diplomacy over the conflict between Israel and Hamas. Since entering government he has repeatedly demanded a ceasefire in Gaza. Just last week the number of Palestinians killed in the conflict topped the bloody milestone of 40,000.

The UK Foreign Office is also reviewing whether to ban the sale of British weapons to Israel with many expecting it to conclude as MPs return to the Commons. Keir Starmer has also been busy attempting to show the UK’s continued support for Ukraine’s wartime leader Volodymyr Zelenskyy – despite the change in government.

In July he invited Zelenskyy to address Cabinet in-person and in a message on Ukraine’s Independence Day last week, the new PM said: “My message to all Ukrainians, whether on the front line or here in your second home in the UK, is crystal clear: we are with you today and always.”

Overcrowding in prisons

In the second week of the Labour government, the new Justice Secretary branded Rishi Sunak and his gang in No10 “guilty men” for the state of the prison system they left behind.

Shabana Mahmood said she had been left with no choice but to introduce emergency measures next month – releasing thousands of prisoners early. Those serving less than four years after as little as 40% of their sentence – with some exceptions some as sex offenders – could be released under the measures.

With prisons nearly at capacity, ministers were also forced to trigger Operation Early Dawn last week in parts of northern England. The plan allows defendants to be held in police cells and not summoned to court until a space in prison is available.

In his speech, Mr Starmer, who was Director of Public Prosecutions before entering the Commons, will say: “I didn’t want to release prisoners early. I was Chief Prosecutor for five years, it goes against the grain of everything I’ve ever done. But to be blunt, if we hadn’t taken that difficult decision immediately, we wouldn’t have been able to respond to the riots as we did.”

Immigration

The PM will be painfully aware he’ll face criticism whatever he does to address immigration.

Latest Home Office figures reveal there was an asylum backlog of nearly 119,000 at the end of June, with the Tories “distracted” by the Rwanda project. Many of these people are in limbo living in hotels, and Tory legislation meant they could not apply for asylum.

The new Government has set to work processing applications, but the Tories and Reform UK have been on the attack, accusing Labour of an “amnesty”. There’s also the small boats crisis.

Latest Home Office figures show 5,720 people have made the perilous journey across the Channel since Labour came to power. The Government has scrapped the costly Rwanda deal and launched a Border Security Command instead.

A new commander is expected to be announced in the coming weeks, and the UK will be working with European neighbours to smash people smuggling gangs. But Mr Starmer knows he’ll face heavy criticism if this doesn’t yield results. Home Secretary Yvette Cooper has also vowed to step up removals, saying they’ll be at 2018 levels within six months.

University funding crisis

Before the General Election the crisis in university funding was listed in an internal Labour dossier – dubbed a “s*** list” – of risks facing the new government.

Earlier this month the head of the Office for Students also warned the funding crisis facing the sector was “significant” amid concerns some institutions risk going bust. Sir David Behan told the Sunday Times: “We’ve had industrial action, the cost of living crisis, the increasing cost of pensions and decreasing number of international students, and then, finally, domestic undergraduate fees remaining frozen since 2012 … and what it’s meant is that the fiscal deficit for a number of organisations is really significant.”

Education Secretary Bridget Phillipson, who described the funding system as “broken” in opposition, said earlier this month she wanted to review the funding system. But she said raising tuition fees was a “really unpalatable thing to be considering”.

She added: I’m not happy with the system I’ve inherited, and I do want to reform that system. I’ve been looking at all of the options around this, I will continue to review that.” Expect the issue to increase in prominence over the coming months.