Sir Keir Starmer was asked on BBC Radio 4’s Today programme last Friday whether, if he achieved his goal for the UK to attain the highest sustained growth in the G7, he would readopt plans to scrap university tuition fees. He had committed to their abolition when running to be Labour leader in 2020, but dropped the policy last year because he said money was tight. Mishal Husain’s question exposed a contradiction in Sir Keir’s plans: the argument that he ditched his tuition-fee pledge to prioritise the NHS melted away if higher public spending could be financed by faster economic growth. Sir Keir parried, leaving the issue unresolved.
On Monday, Labour’s leader sought to further deflect from his rowback by leaving the door open to raising fees. Polling suggests that would be unpopular. Many voters might not want English university education to be free, but most want to see the cost reduced. Last year, Public First suggested that cutting fees to between £6,000 and £7,500 was the most popular option. Sir Keir was first elected to the Commons in 2015 on a Labour manifesto pledge to trim fees to such levels, with universities’ income made up through increased state support. But it would not be lost on him that even though his party had won the argument, Labour lost that election.
Tax and spending promises lie at the heart of modern election campaigns in Britain. The experience of being put on the back foot over economic issues has led Labour to an almost crippling cautiousness. Sir Keir has sought to close down opportunities for the Tories to label his plans as “tax bombshells”. There are differences between Labour and the Tories. But they are small. Labour’s proposed tax rises – VAT on private school fees, ending the non-dom regime, and a crackdown on tax avoidance – don’t affect the majority of voters, but they do suggest a targeting of unfair advantage.
Labour’s proposals raise about £10bn, a sum dwarfed by the size of the public sector and its problems. Rishi Sunak’s government missed its recruitment target for teachers by more than 13,000 teachers last year. Labour promises to hire just half that number for £350m. The party has also pledged to spend £1.1bn to pay health staff extra for out-of-hours working to deliver the promised 40,000 weekly operations, scans or appointments. That is welcome, but there are 7m GP appointments every week in England alone.
Spending is restrained in part because Labour is targeting a balanced current budget. Even if the economy turns out as forecast, this leaves a Labour government having to either deliver spending cuts to non-ringfenced departments or raise taxes. This fiscal rule could be weaponised by Labour to tap into public frustrations about inequality. But Sir Keir is trying to distance himself from the politics of redistribution. Instead, voters are left with austerity economics, as they are with Labour’s retention of the Conservative fiscal rule that debt as a share of GDP has to be falling by the fifth year of a Treasury forecast. Most investment spending won’t pay for itself in such a short period, limiting Labour’s ambitions.
Sir Keir should think bigger, because the fixes that the country needs exceed what he has offered so far. Reducing the wasteful consumption of the wealthy to make resources available for socially useful spending must be the aim of Labour’s tax policy. Bolder policies can capture voters’ imaginations, if they are clearly communicated and chime with the public’s priorities. The risk is that they become hostages to fortune. However, Mr Sunak will find it hard to appeal to voters’ sense of prudence when their experience of Conservative government has been rising costs, falling living standards and failing public services.
