10 October 2023

Rachel Reeves gives her best speech yet

The shadow chancellor forcefully laid down Labour’s attack lines for the next election.

I have a theory that the secret to a brilliant speech is to speak through the applause. Waiting for the clapping to die out deflates the room; driving on builds momentum. That is what Barack Obama did to great effect during his speech at the 2004 Democratic Party conference. That speech made many in his party start to believe he could be the next Democratic presidential nominee.

Rachel Reeves used the same trick yesterday. Her performance increased the likelihood that she succeeds Keir Starmer as Labour leader. This was the best speech of her career so far (assuming her presentations at the Bank of England and HBOS bank lacked panache). She spoke with a seriousness and conviction incomparable to any single paragraph uttered at Conservative Party conference. There was little new substantive policy: a commitment to crowding-in private investment; a reduction in the government’s use of consultants; a new team to claw back the money fraudsters stole during the pandemic. A few million here or there is not going to change the purpose of the state. But it still matters politically. As one pollster pointed out to me last night (9 October), Covid fraud still riles voters. Partygate itself continues to resonate. It epitomises the sense that the Tories looked after themselves during the pandemic. Don’t forget it was also the reason that Boris Johnson’s polling supremacy fell away (alongside the Owen Paterson lobbying scandal). This is an excellent attack line with which to berate the government and connect Rishi Sunak with the past.

Reeves’s key objective is reassuring voters that Labour won’t crash the economy, and that the Tories will. Her speech was filled with campaign-ready lines to that effect: “You cannot trust the Tories with our economy ever again”; Liz Truss “is still leading the Conservative Party”; “the biggest risk to Britain’s economy is five more years of the Conservative Party”; “Labour is ready to serve, ready to lead and ready to rebuild Britain.” These lines should frame Labour messaging going forward, drilled ad nauseam.

But we shouldn’t put Reeves’s decision to avoid appearing radical on economic issues completely down to politics. This is a policy choice as well. Her speech was followed by a short, pre-recorded endorsement from Mark Carney, the George Osborne-appointed former Bank of England governor. Some have interpreted this as Carney’s defection from the Conservatives to Labour. I think it reflects Reeves’s closeness to the economic orthodoxy that Carney represents. For instance, Reeves double-downed on her commitment to the Office for Budget Responsibility (OBR) that she would create a “Charter for Budget Responsibility, a new fiscal lock… guaranteeing in law that any government making significant and permanent tax and spending changes will be subject to an independent forecast from the OBR”.

On the face of it, this is not a major departure from the current role of the OBR, which already produces forecasts alongside budgets and fiscal events. The difference is leaders would be prevented from trying to depart from the assumptions the OBR uses to produce the forecast by not having one. Truss did so, infamously. But as Ben Riley-Smith’s new book The Right to Rule reveals, Johnson’s No 10 also considered scrapping the OBR forecast to move beyond austerity. Reeves’s decision would shift power away from the politicians and towards independent bodies. It reflects a strain of legalism within Labour that we also saw in Gordon Brown’s report on the constitution, which advocated creating social and environmental “rights” instead of simply creating the policy that those rights were trying to achieve. Taking what should be debated and scrutinised and turning them into rights narrows the political realm. “Tax and spending changes” should be at the heart of democratic debate. Not something taken for granted.