Rachel Reeves will be able to recall the precise moment her political career ended. The hands of the old House of Commons clock stood at 1.06pm when she sat down, having delivered her Spring Statement.
Up until that moment the Chancellor had been praying something might come to her rescue. That amidst the thickets of charts and graphs and tables contained in the Office for Budget Responsibility’s (OBR) economic projections there would be a number that would defy expectations.
That her own fiscal target had not been busted by £14billion. Growth figures that hadn’t been slashed in half. Tax receipts that meant she wouldn’t have to tell grim-faced Labour MPs that her cuts would force 250,000 people, including 50,000 children, into poverty.
But there was no relief. The report was as damning as had been predicted.
In January Reeves pledged she would ‘kickstart economic growth’. Today she was forced to concede she had done the opposite.
During the election she had claimed ‘everything in our manifesto is fully costed and fully funded’. Today she attempted to tell an incredulous House that her careful plans had been upended by a sinister coalition of Rishi Sunak, Vladimir Putin and Donald Trump.
Last September she had declared at the Labour conference: ‘We do not have to choose between a fair society and a strong economy.’ Today she implored the country to understand.
So now political gravity will begin to do its work. Over the next few days the economists and statisticians will crunch the numbers. The markets – already suffering palpitations from October’s budget – will deliver their own response.
But the verdict that matters will be delivered by the British people. And it will be merciless.
Sir Keir Starmer congratulates his Chancellor Rachel Reeves after her Spring Statement – but the public will be ‘merciless’, writes Dan Hodges
Addressing MPs in the House of Commons
Labour’s poll rating had already begun to crumble after last week’s announcement of cuts to support for disabilities. That will now turn into a landslide.
Then in just over a month voters will go to the polls at the by-election in Runcorn. Labour is defending a 15,000 majority. Reform will devour it. On the same day a third of the country casts its vote in the local elections. Labour’s support will implode.
At which point the briefing will commence.
Publicly, Downing Street’s line will be the Prime Minister will ‘listen and learn’. But privately, Starmer’s officials will point to the fact that whilst he was beginning to turn the narrative surrounding his government with his international statesmanship, all his good work was undone by the poor economic news at home. ‘Keir can’t manage everything,’ will become the unofficial line to take.
Indeed, the groundwork is already starting to be laid.
When Reeves reignited the freebies row earlier this week by admitting she had taken free tickets to a Sabrina Carpenter concert, two ministers – Heidi Alexander and Matthew Pennycook – gave separate interviews in which they pointedly said they didn’t think taking freebies was appropriate. And given the importance of today’s statement, they wouldn’t have pulled the rug out from their own Chancellor if they hadn’t be sanctioned to do so.
Reeves will probably survive Starmer’s first reshuffle, which is likely to come soon after the local elections as part of another ‘reset’. It would be too much of a humiliation to ditch her after one year.
But her card has been marked. And soon she will be a lame duck, effectively keeping No 11 warm for the impending arrival of Darren Jones or Pat McFadden.
Reeves leaves No 11 for the Commons this morning
Reeves’ freebie tickets to see singer Sabrina Carpenter (pictured) were condemned by her fellow MPs – surely a sign that the Chancellor is having the support rug pulled from under her
The reality is – and today’s statement has ended any debate on this – Rachel Reeves is out of her depth. She is a solid, competent politician. But she has neither the economic or political-bandwidth to be a successful Chancellor.
Her attempt to stimulate growth while simultaneously piling £40billion of taxes on business, imposing a raft of new workplace regulation, driving through net zero and cutting back on spending has been as economically illiterate as anything we saw during the infamous Truss/Kwarteng era.
And it’s commonly acknowledged by her fellow ministers that her decision to rule out changes to personal taxation in advance of the election meant she was binding herself into a straitjacket from which there is now no escape.
After another 14 years in the political wilderness what Labour needed was a Chancellor with the innovation and intellect of a Brown, the radicalism of a Lawson or the guile of an Osborne. But Reeves can only think in two dimensions. As evidenced by the fact the central plank of her economic strategy, her £28billion ‘Green Revolution’ had to be junked before she even entered office.
Now she has had to rip up yet another economic plan. And this time the voters – and her own party – will not be giving her the benefit of the doubt.
There was a telling moment on Tuesday when Reeves appeared for her final pre-statement photocall. She could have stood in a high street, as a symbol of her pledge to stimulate growth. She could have appeared on a housing estate, a symbol of her commitment to stand with working people. She could have stood in a hospital ward, a symbol of her historic promise to rebuild our public services.
Instead she stood in front of a tank. This is what Labour are now reduced to. Peddling the fiction that Vladimir Putin is to blame for the fact people with MS and Parkinson’s are going to be asked to hand back the £70 a week the government currently gives them to enable them to wash and feed themselves.
The British people are not going to fall for it. And the British people are not going to stand for it.
Rachel Reeves doesn’t realise it yet. But today she delivered her resignation as Chancellor.