The Labour Party has just managed to out-Tory the Tories over the so-called cost of living crisis. It has called for the government’s spending to be independently checked. And in doing so, Keir Starmer’s party has just exposed itself as an absolute nonsense.
Windfall tax = little support
As The Canary previously reported, the government has announced a windfall tax to pay for measures to ease the cost of living crisis. Think tank the Resolution Foundation noted that parts of this included:
- Payments of £650, made over two lump-sum grants, to over 8 million households on means-tested benefits;
- An additional £300 on top of the usual Winter Fuel Payment this winter, going to all pensioner households;
- An additional £150 to around 6 million people who receive a disability benefit;
- Doubling the discount on all households’ electricity bills due this autumn to £400, and:
- An additional £500 million for the Household Support Fund from October 2022.
It said this was on top of:
- A £200 rebate on electricity bills, due to take effect this autumn, and a £150 Council Tax rebate for households in Bands A to D, both announced in February 2022, and:
- An increase in the National Insurance threshold from £9,880 to £12,570 in July and a 5p cut to Fuel Duty rates announced in the Spring Statement.
But in reality, none of this makes up for the huge increases in energy bills and massive rise in overall inflation. For example, The Canary calculated that the poorest families will still be around £300 a year worse off. Plus, support for chronically ill and disabled people, and families with children who are reliant on social security, is still dire.
Not that Labour seemed to notice any of this.
Labour: not happy for the wrong reasons
Firstly, the party was pleased with the government’s plan. As the Guardian reported, shadow chief secretary to the Treasury Pat McFadden said Labour “welcomes these announcements”. But at the same time it wants the Office for Budget Responsibility (OBR) to analyse the government’s plan. The Guardian reported that McFadden:
said that, although the sums were “of the order of magnitude that would normally be announced within a budget”, the UK’s tax and spend watchdog should “provide authoritative and independent economic and fiscal projections”.
Labour wanting the OBR to check the government’s figures may be in part due to some people claiming the windfall tax could make inflation even worse. But in reality, all Labour has done is make the Tories look better.
What a mess
A windfall tax this year was originally Labour’s idea – which the government then improved on; win number one for the Tories. Now, by effectively questioning the economic sense of the Tories’ plans, Labour has headed further to the right-wing. It has also given the Tories an immediate stick to beat it with – because they’ll be able to claim that Labour’s not on the side of ordinary people.
Moreover, Labour’s actions seem typical of the centre-right of the party’s obsession with appearing economically credible. But all it is achieving is appearing completely out-of-touch. Labour could have come at the windfall tax by saying it’s not good enough. If it was concerned about inflation, it could have argued that it’s the Bank of England’s job to control this. Instead, it’s veered to the right wing and now left itself exposed to Tory criticism.
At a time when people’s lives are in freefall, Labour should be at least resembling a robust opposition. Instead, it’s an absolute mess.
Featured image via Sky News – YouTube
