In the final week of the 2015 election campaign, Ed Miliband travelled to a car park in Hastings and unveiled an 8-foot, 6-inch limestone slab on which six pledges had been carved. Had Labour won that election, the stone would have stood in the Downing Street rose garden as a reminder of the party’s promises to the country. It was intended to convey unshakeable commitment but it was met with derision, rebranded immediately as the “EdStone”, a farcical monument to a campaign that had already expired. After the defeat, it was taken to a warehouse in south London and is believed to have been destroyed.
The six pledges carved into the stone have proved more durable, however. Its top two promises were “a strong economic foundation” and “higher living standards for working families”. At Pinewood Studios yesterday, Keir Starmer unveiled six “milestones” that Labour plans to reach this parliament; at the top are “strong foundations” for the economy and “raising living standards in every part of the United Kingdom”.
What’s notable about the changes from missions to milestones is the way in which the government will measure its achievements. The “Plan for Change” document that the government published after the speech yesterday has the details: the manifesto promise to deliver “the highest sustained growth in the G7” will be measured in real household disposable income (RDHI) and GDP per capita, measured at a regional level.
These are much better measures of economic progress than GDP alone. Russia, for example, has enviable GDP growth, but I’d rather live in an economy in which supermarkets don’t need to lock up the butter. Jeremy Hunt crowed in 2022 that Britain’s GDP growth was the highest in the G7, and he was right, but only because under the Conservatives, the UK had failed to recover from the pandemic as quickly or as fully as other major economies, so there was a point when the number looked good for us.
Normal people are rightly unmoved by the claim that our total economic output can be described as growing at a higher rate than that of Germany or the US at a given time. Government by abstract numbers reinforces the impression that the country is run by a load of smug Oxbridge PPE grads who will be fine whatever happens, and for whom this is all a game.
This was demonstrated by the US election. I don’t pretend to understand Americans and I’m not going to try, but it is clear that the economy was the key issue; it was more important to voters than in any election since 2008. Trump had the better record: Americans’ relative purchasing power increased during his last term, while under Biden it fell. Voters demonstrably did not care about the incredible feats achieved by their government, which kept petrol affordable during a global energy shock, and their central bank, which managed to extinguish double-digit inflation without causing a recession. They cared that eggs were more expensive.
RDHI is therefore a good number to target, because it represents something more like real money. (It’s also a more reliable thing to target: the Office for Budget Responsibility already forecasts 2.9 per cent RDHI growth over this parliament.) However, swapping one acronym for another doesn’t change the nastiness beneath the surface.
Better still would be to make a promise on a figure people actually pay, such as their rent. Shortly before Starmer spoke yesterday, the government published the English Private Landlord Survey, which found that although 40 per cent of landlords are unaffected by borrowing costs, the proportion of landlords who increase the rent on their property for every new tenancy has doubled in the past three years; three quarters of the wealthiest landlords had done this in the past year, raising rents by an average of 11 per cent. The overall inflation rate on private rents is 8.7 per cent, and the New Economics Foundation predicts that government support for private renters will reach £70bn by the end of this parliament.
This will be felt by those least able to afford it. The Joseph Rowntree Foundation expects the real disposable income of those in the bottom 40 per cent of incomes to fall this parliament, as housing costs devour earnings and benefits.
This is why Starmer’s other major milestone is the target to build 1.5 million new homes. Writing in the Times this morning, the PM promises to “fast track more houses” and deliver “the biggest wave of social homes in a generation”. Previous governments have repeatedly failed to keep similar promises, but this feels more consequential. A government can claim whatever success it likes on the big acronym numbers, but if the real costs faced by voters aren’t controlled, that will make no difference.
[See also: Starmer’s pledges leave his government exposed]
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