In Labour's search for meaning, its MPs will need to be patient
Prime Minister Keir Starmer leaves Downing Street to attend Prime Minister's Questions, Wednesday, March 19, 2025. (AP Photo/Kirsty Wigglesworth)
4 min read
Liz Kendall’s welfare cuts this week exposed an underlying tension in the Labour Party between fiscal necessity and political identity.
Employment reforms, such as encouraging people into work by allowing them to try jobs without losing benefits, are a sensible move – one any government would be wise to adopt, regardless of budget pressures – but deep cuts to Personal Independence Payment (PIP), which supports people with disabilities, will make many Labour MPs nervous.
No 10 pitched the PIP reforms as a way to nudge those with mild anxiety or depression back to work – a clean split from physical disability, a step toward independence. Reality blurs that line. Analysis from the Resolution Foundation suggests that nearly nine out of 10 of people with psychotic disorders would see their support cut; any ‘savings’ are likely to be surpassed by the costs that are passed on to the police and health service.
Many Labour MPs worry that the purpose of Labour in government is not clear
Distributional analysis shows that those on lower and middle incomes will be hardest hit. Those who will lose support will include those who cannot cook a proper meal for themselves or wash without assistance – tasks far from trivial. When the government brings these proposals to a vote, expect some compromise on the eligibility.
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The welfare cuts, alongside cuts to Winter Fuel Payments and international aid, as well as rising child poverty, contribute to a deeper anxiety on Labour’s benches. Many Labour MPs worry that the purpose of Labour in government is not clear. The government’s growth mission enjoys broad support – the alternative of decline or stagnation are worse for everyone – but many see growth as a means, not an end. They want to hear more about why, not how Labour governs. Downing Street should fast-track its child poverty review to ease this tension and provide a clearer answer.
The welfare cuts also feed a dangerous narrative about a broader despair: uncontrollable global forces – US trade, Russia’s war – drove up living costs and are now squeezing welfare budgets, leaving middle- and lower-income families feeling powerless. Since 2008, this profound sense of economic fatalism has had significant impact on British politics, first in the form of Brexit and now in the rise of Reform. Boris Johnson briefly countered it with “boosterism”, but his unfulfilled promises only deepened the gloom. Labour can’t afford the same mistake.
There have been some whispers that Blue Labour – Lord Glasman’s vision of “red wall” towns knit by factories and faith, as a bulwark against globalisation and the pressures of mass immigration – should be Labour’s philosophical cure. But nostalgia is a promise that Labour, like Reform, cannot keep and therefore should not make.
Where does that leave those Labour MPs in search of meaning? No one in Downing Street really believes the answer is to make Starmer wear a philosophical suit that doesn’t fit. Starmer himself has repeatedly prioritised competence and delivery over grandstanding or ideological purity. There are no signs that the Prime Minister intends to be anything other than pragmatic. So, the answer will not be found in an off-the-shelf ideology, and instead identity will be defined by the decisions that Starmer takes.
That means Labour MPs will need to be patient. But No 10 can do more to make the growth mission tangible, real and personal to ordinary families. Lower- and middle-income families and local communities need a stake in the economy that they can see and touch, so that the goals of long-term growth do not appear to be just corporate gains or distant GDP figures. Margaret Thatcher did this effectively in the 1980s when she sold her economic mission to the public through totemic policies like the right-to-buy council homes and the ‘Tell Sid’ privatisation of British Gas. Those policies are clearly not the answer for Labour in 2025, but No 10 should learn from how those symbolic offers gave ordinary families a sense that the Prime Minister’s personal and national economic ambition was also their own. If Thatcher could make privatisation appear accessible and aspirational to the many not the few, then Labour should be able to do the same for its own long-term growth policies.
Starmer’s pragmatic pursuit of growth is the answer to Labour MPs’ search for meaning. But the mission needs to be more tangible, giving voters a stake in that growth. And the story can’t just be a cautionary tale about Liz Truss and the risks of borrowing and unfunded commitments. It also needs to be one of hope and aspiration.
Theo Bertram is director of the Social Market Foundation
