ANDREW NEIL: Scrimpers and savers aren’t deemed ‘working folks’ so the tin-eared PM and Chancellor can clobber them with additional taxes. Labour has misplaced the plot

Labour has its knickers in a twist over what it means by ‘working people’ — and the more it flails around groping for anything approaching a coherent definition, the more ridiculous it sounds.

But the matter is too serious for mere mockery and derision – though it deserves both in spades. People’s future financial wellbeing is at stake.

Labour’s election manifesto was clear enough: ‘Labour will not increase taxes on working people.’ But during the campaign, many broadcasters, including myself, tried to get Labour politicians to define what they meant by ‘working people’ so that our audiences could know who would face higher taxes under Labour and who wouldn’t.

We were met with an incomprehensible flurry of word salads drizzled with drivel. Matters are no clearer now Labour is in power. From Prime Minister Keir Starmer down, we have a government of apparatchiks incapable of telling us what they mean by ‘working people’.

Yesterday morning Treasury minister James Murray was asked no fewer than six times on BBC Radio 4: ‘Do landlords work?’ Six times he took cover behind a wall of waffle. Remember — he’s a Treasury minister!

Earlier in the week, Sky News asked (also multiple times) another minister, Stephen Kinnock, if those who worked and earned £100,000 a year or more could be regarded as working people.

The Labour manifesto put no salary ceiling on what it meant by the term and so the obvious answer, by any sensible definition, was ‘Yes.’

But like his ministerial colleagues, Kinnock took refuge in dissembling. It was so obvious it was embarrassing.

Asking their boss is no route to greater clarity. Of course Starmer has had his problems defining what a woman is (he’s still a bit vague), so perhaps we should not be surprised he’s also flummoxed when it comes to the concept of working people, even though he’s had plenty of practice trying to come up with a credible answer.

During the election campaign he tried various formulations along the lines of working people being those who lived from pay cheque to pay cheque and had no resources to fall back on in hard times.

It was all vague, unquantifiable stuff but seemed to imply you were only a member of the ‘working people’ if you were of modest means on a modest salary. Yet, as I say, the Labour manifesto offered no such limitations.

Over three months in power and only days away from his government’s first Budget, Starmer is still incapable of greater precision.

Asked again yesterday at the Commonwealth summit in Samoa about what constituted a ‘working person’, he described somebody who ‘goes out and earns their living, usually paid in a sort of monthly cheque’ but they did not have the ability to ‘write a cheque to get out of difficulties’.

I think he might just have described most families in the country. But such vague generalities are surely no basis for determining tax policy. The more he talked, the harder it became to understand what he was saying. He would be well advised to heed the old maxim: ‘If your going to dissemble, keep it short because, the more you say, the more likely you are to be rumbled.’

‘When I tell you who’s in my mind’s eye,’ he rambled in a manner that would give Kamala Harris a run for her money, ‘I think everyone watching will know whether they are in that category because you carry in that situation a sort of knot in the bottom of the stomach which, if push comes to shove and something happens to me and my family, I can’t just get a cheque book out, even if I have savings.’

Put aside his archaic obsession with cheque books. Banish from your mind the question: If people have savings why can’t they get their cheque book out (or, in today’s world, make an online transfer)?

Consider instead the plight of Treasury officials as they labour over next week’s Budget. How on earth do you turn such fuzzy musings into tax policy for October 30?

‘You want us to exempt anybody who has no savings and lives from pay cheque to pay cheque, Prime Minister. How exactly would we do that?’

No wonder Chancellor Rachel Reeves has been looking increasingly worried as the great day approaches.

But we were not left entirely clueless. Starmer showed his true colours when he was then asked if ‘someone who works but gets their income from assets as well, such as shares and property’ was a working person.

‘Well, they wouldn’t come within my definition,’ he replied sniffly.

And there you have it. Even if you work for a living, if you supplement your salary with investments in shares or property you are not, in Starmer’s narrow worldview, a ‘working person’. Even if you might be putting in 100 hours a week to grow your small business or keep it above water.

It is, of course, an absurd distinction. So much for his claim to have repositioned Labour to be the party of strivers and entrepreneurs.

The Downing Street spin doctors later tried to clarify what Starmer had meant. As usual, they only muddied the waters further. The PM, they claimed, thought you could still be ‘working people’ if you only had a ‘small’ part of your income from shares or property.

Fair enough. But how small is small? Now you will understand why Treasury officials have been tearing their hair out.

I seem to remember Starmer recently made a ton of money from the sale of an asset (some land). So I guess by his own definition he’s not a working person either.

What Labour really meant by ‘working people’ in its manifesto was ‘working class’ (into which Starmer still thinks he fits – his father was a toolmaker, you know). But working class sounds too early 20th century, too hammer and sickle on the red flag. 

Hardly convincing these days for a party whose core support now comes from the white-collar, middle-class metropolitans, especially those in comfortable, secure public sector employment (like Starmer). So it opted instead for the less socialist, more neutral category of ‘working people’, even if it couldn’t define it.

And yet, despite Labour’s confusion and opacity over what it means by working people, its direction of travel is all too transparent.

Take its inability to see landlords as working people. Just as Labour still hankers after a special relationship with some mystical working class, so it regards landlords not as working people but as capitalist bloodsuckers living off the work of others.

For several years I was privileged to chair an annual convention of UK landlords in London. Overwhelmingly they were business folks with small property portfolios they worked hard to keep up to scratch, laboriously navigating the thickening web of rules governing their sector and struggling to handle new regulations which sometimes seemed designed to put them out of business (even under the Tories).

By any sensible definition they are working people. None was living the life of Riley, sunning themselves in southern Spain while gouging their hard-pressed tenants with ever-rising rents back in Blighty. 

Of course there are bad landlords presiding over appalling housing and the law should deal with them harshly. But there are almost three million of them in the UK and the vast majority provide a decent, essential service at a time when the political class has failed to build either enough social housing or homes for sale. For many young folk, renting privately is the only option.

Consider now why those who work but have saved to supplement their income with investments in shares are not working people in the Starmer lexicon? Since when did regular saving and investment for retirement or other purposes banish you from the ranks of ‘working people’? It is a ludicrous proposition.

We’re not talking about fat cats. We’re talking about people who work hard. They scrimp and save to fund a nest egg for their retirement or to help their kids with university fees or with buying their first house.

sometimes I wonder if Starmer realises how much his loose talk incenses the people to whom he so cavalierly refers. If they are now to be excluded from the ranks of working people so that a tin-eared Prime Minister and his Chancellor can clobber them with all manner of extra taxes next Wednesday while claiming it’s breaking no manifesto pledges, then Labour really has lost the plot.

And maybe it has – for the plan being mooted for charging national insurance on employer pension contributions is further evidence of the bad place Labour is coming from.

It’s been suggested that only private sector employers would be charged NICs on the contributions they make to their workers’ pension pots. Public sector employers would either be exempt or compensated for the extra cost of employment (by the rest of us, of course).

Perhaps we should expect no less from a government led by someone who has already accumulated a massive public sector pension pot for when he retires – so large, in fact, that it required special legislation to guarantee it.

But, as David Blunkett, a former Labour work and pensions cabinet minister warned yesterday, if employers have to pay NICs on their pension contributions then, at a time when they should be increasing these contributions, they will be incentivised to freeze or even cut the contributions they currently make.

They would thereby undermine the private sector pension prospects of millions in the years to come. ‘I would advise strongly against this,’ writes Blunkett, bluntly.

He’s right. The Government drones on about the need for Britain to invest more in the public and private sectors. But there can be no investment without the savings to pay for it. Yet this government shows very little interest in encouraging people to save.

When Starmer addressed the nation from outside Downing Street on July 5 before entering No 10, he wanted us to know that he saw public service as a privilege and that his government would ‘treat every single person in this country with respect’.

‘Whether you voted Labour or not,’ he intoned gravely, ‘in fact especially if you did not, I say to you, directly: my government will serve you.’

Just over three months later, these words already sound pretty hollow. The chances are that, if you do not fit Labour’s definition of ‘working people’, you will be served badly — or not served at all.

Working people who have saved to supplement their modest income with interest or dividends, landlords trying to survive in a hostile environment, those who earn big salaries through the their own hard work and diligence, folks who are nurturing a nice nest egg for their retirement or the future use of their family – you are not ‘working people’ in Starmerland, especially if you happen to work in the private sector (where most of us do).

You are vulnerable to the vagaries of a government desperate to raise billions more in revenue for its nefarious spending plans. For you, its promise not to raise taxes is already as nothing. It believes it has carte blanche to do as it sees fit with you on Budget Day.

Halloween is coming a day earlier this year for you. Be afraid on October 30. Be very afraid.