The Most Ambitious Statement of Economic Intent

Dominik A. Leusder writes:

Last Monday, Andy Burnham delivered what was perhaps the most ambitious statement of economic intent since 1997. Standing outside Downing Street, the Prime Minister spoke of “a new political model and a new economic model”. The idea, he said, was to put “life’s essentials back under stronger public control” and to reindustrialise Britain “using public procurement to back British industry”.

This certainly sounds ambitious. But rhetoric is cheap and it has so far proven difficult to pin down Burnham on specific policies. He took a week to end speculation about scrapping council taxes and stamp duties and replacing them with a flat property value tax, clarifying that “nothing immediate” on the issue was in fact planned. This was just a day after he walked back an earlier suggestion about raising personal income tax allowances.

With this in mind, it is not clear how to interpret the Prime Minister’s announcement on Wednesday that the Government will look into financing a reform of Britain’s long-neglected social care system, potentially with tax hikes. But following the old adage that personnel is policy, perhaps one can infer Burnham’s actual priorities and preferences through his staffing choices.

On matters of economic policy, Burnham’s court of ministers, advisers and aides can be divided into roughly three camps: Brownites with a regionalist and national security bent who are broadly aligned with the Treasury orthodoxy; soft-Left mandarins and policy experts with a long paper trail of criticising it; and progressive think-tankers with cautiously radical reform ambitions.

The Chancellor falls squarely into the first camp. John Healey’s resignation over his predecessor Rachel Reeves’s budget was not a sign of heterodoxy but of its opposite: a complaint that the Treasury would not fund rearmament, not that it ran the country by rulebook. His formation is the purest Brownism left in frontline politics. He came into Parliament from the campaigns directorship of the Trades Union Congress, co-wrote Labour’s first paper on regional economic policy with Ed Balls in 1998, and spent five years as a Treasury minister under Brown before the housing brief made him the party’s most persistent advocate of council house building.

Last week, Healey told Treasury staff in his first speech that “fiscal control must be the first duty” of the office and promised to meet the rules “in lockstep” with Burnham while “ensuring there’s a buffer also for uncertainty”, a sentence that commits him to running larger margins than Reeves ever enjoyed. The distinctive Healey move is to weld the doctrine to the flag: fiscal credibility, in his telling, is “the bedrock of economic stability and national security”. Tellingly, his new political team, drawn largely from his defence operation and chiefed by Will Straw (another product of the Brown Treasury), contains not a single economic adviser.

The intellectual warrant for this position comes from Richard Hughes, the former chairman of the Office for Budget Responsibility, whom Burnham included as one of his fiscal advisers ahead of the expected leadership challenge. Hughes is the nearest thing British fiscal policy has to an internal auditor: a career Treasury official who ran the 2007 spending review, did fiscal surveillance at the IMF, and at the Resolution Foundation wrote the case for rules that recognise the state’s assets as well as its debts, the intellectual ancestor of the net financial liabilities measure the government now targets. His verdict on the UK’s current fiscal framework inverts the common complaint: the rules are not too tight but “among the loosest the UK has had in its history”, he told the Lords in January; the British disease is “how frequently we abandon” them, and the gaming of targets that are met in letter and violated in spirit.

Ranged against Healey and Hughes, at least on paper, are the two most senior economists in Burnham’s orbit: Jim O’Neill and Andy Haldane. They are both Sheffield economics graduates of a certain vintage as well as long-standing critics of the framework their government has just re-embraced. O’Neill, tipped as chief economic adviser, took the scenic route to Manchester patriotism: after two decades at Goldman Sachs, where he coined the term BRICs and chaired the asset management arm, he oversaw the Royal Society of Arts’ City Growth Commission, making an agglomerationist case for metro devolution that George Osborne bought wholesale, hiring O’Neill to deliver the Northern Powerhouse. He has called the fiscal rules “petty and arbitrary”, dismissed Starmer’s welfare squeeze as “playing around with small amounts of savings” to satisfy them, wants council tax and stamp duty replaced outright, and confirms that devolving income tax is being examined “in a serious way”.

Haldane, the former Chief Economist of the Bank of England, arrived at similar conclusions from inside the state: after 32 years at the Bank — where his speeches on the financial sector’s mirage of measured productivity and the share buyback culture of the equity market remain the establishment’s best account of why profits stopped becoming investment — he chaired the Industrial Strategy Council and helped to write the Levelling-Up white paper. He has attacked the “fiscal straitjacket”, called the case for changing the rules “overwhelming”, and blamed last autumn’s “fiscal fandango” of tax speculation for flatlining growth.

Burnham’s talk of putting “life’s essentials back under stronger public control” bears the watermark of some of his more progressive advisers, including figures from influential think tanks, the New Economics Foundation, IPPR North and Common Wealth. Miatta Fahnbulleh, NEF former chief executive and now Secretary of State for Energy Security and Net Zero, is among Burnham’s closest confidantes. She describes her politics in the terms of the cooperative tradition of the Left, favours “common ownership of public goods and essential infrastructure”, and has explored taking water into public hands on the costless model Louise Haigh used for rail. IPPR North’s Zoë Billingham is a natural pick as the head of one of the institutional homes of the devolution and regional rebalancing agenda. Common Wealth’s founder, Mathew Lawrence, was the co-author of a recent paper, published through the Burnham-aligned Mainstream group, extending Manchesterism to British capitalism at large. It advocated public intervention wherever investment has dried up and rents inflate the price of primary needs.

This is the only wing of the Burnham court with a sophisticated theory of public ownership, one that is framed in terms of fiscal prudence too. Nonetheless, the current fiscal framework prices their programme as ruinous, since rules that net off financial assets but not physical ones make renationalising a water company look like fiscal incontinence and a minority stake look like prudence.

Indeed, the priorities of Burnham’s three different camps militate against each other: accepting the notion that the UK’s fiscal position necessitates an enforcing of the rules is ultimately not compatible with planning for industrial revival and renewed public control of key goods provision. These ambitions imply a decade of investment, public and private, in plant, grids, housing and skills before any of it returns a penny of revenue. The current rules that treat such outlays as identical to consumption ration precisely the spending on which future output depends. And reasserting public ownership compounds the offence: perversely, borrowing to acquire a controlling stake in a revenue-generating utility registers as pure fiscal deterioration, since consolidation extinguishes the offsetting financial asset and the physical estate counts for nothing against the debt incurred. Above all, persistent fiscal constraints depress the aggregate demand on which private investment decisions hinge, so productivity continues to stagnate, the growth rate and tax revenue disappoint, and the rules tighten again. This vicious circle that the UK has drawn since the financial crisis is not conducive to any programme of economic transformation.

If this seeming contradiction has to be resolved one way or another, then Healey’s appointment, with Hughes lurking in the background, suggests it won’t be in favour of the progressives. Healey’s first speech as chancellor suggested that his quarrel with Reeves wasn’t doctrinal but specifically about the refusal to accommodate more defence spending. That’s why he named fiscal credibility as “the bedrock of economic stability and national security”. On the evidence of the Government’s first fortnight, Haldane and O’Neill, neither of whom hold confirmed posts, have already lost the argument.

Whatever his rhetoric, then, one might conclude that this signals Burnham’s revealed preference for continuity. More cynical tongues might suggest that any perception of a political sea change reflects the Prime Minister’s penchant for savvy social media stage management. But though his personnel and fiscal doctrine are Brownite, Burnham is distancing himself from Whitehall. While Brown’s model made the Treasury the strategic brain of government, Burnham’s “beefed-up No. 10” with a “malleable” Chancellor is built to do the opposite. The extent to which more transformative policy ideas have any purchase on his decision-making will depend on this new model actually working as intended. It is noteworthy, however, that it was Burnham and not Healey who sought Hughes’s counsel.

But what is more conspicuous about Burnham’s economic worldview are the elements that are absent. There is little to suggest that Britain’s new leader realises how strange the country is, in macroeconomic terms. Though “Manchesterism” produced consistent above-national-average employment and output growth, income growth remained weak. That is because real wages have grown poorly everywhere, not just because cost-of-living pressures have persisted but because productivity growth has not budged, in no small part due to investment being consistently low. On these metrics the UK is a strange outlier among its peers.

But as some of the response to Burnham’s moderately ambitious proposals suggests, there is little appreciation for this fact. The reaction to his social care proposal this week was telling. He accurately pointed out that social care workers, often immigrants, live on “poverty pay”, while almost two million elderly Britons need to qualify for state aid given the low threshold, and often face having to sell their homes. But many commentators suggested that the UK can’t afford any more social spending and that middle-class households are already overtaxed. The Resolution Foundation had already taken to sounding the alarm based on Burnham’s proposals so far, claiming Burnham’s pledges had reduced the “fiscal headroom” to as little as £8 billion.

What is absent from the conversation is how UK spending measures up internationally. First and foremost: the UK is not a heavily taxed society by any standard. As of 2024, total tax revenue including social security contributions as a share of GDP was at 34.4%, only just above the OECD average and well below the EU average of 39.3%. And the tax wedge, that is how heavily the state taxes a full-time single worker on an average salary, was at 29.9%, placing Britain dead last in a group that includes all EU countries and the United States. When including average council taxes, the wedge increases by a few percentage points, keeping the UK well below the EU average of 44.1%. This reflects the fact that median income households in the UK are in fact less taxed than elsewhere, and significantly so.

Meanwhile, the most recent figure for the UK’s net social expenditure was at 22.8% of GDP, below both the EU and the United States. Any worry that the country’s welfare bill is too high seems misplaced. It is equally hard to understand why the much maligned triple-lock on Britain’s modest state pension attracts so much vitriol and media attention: precisely because of the reliance on capital income to fund pensions, the magnitude of gross old-age benefits is minimal, amounting to just over 7.6% of GDP in 2023. The same OECD data suggests that the UK relative position doesn’t change even if the triple-lock persists until 2040.

Whatever the reason the UK economy underperforms relative to its wealthy peers, it is hard to find fault in social programmes whose public spending footprint pales in comparison. There is little to suggest that the senior government and its current crop of advisers and official appointees realise that the country’s economic policy discussions are profoundly insular and out-of-tune. Perhaps the biggest inference we can make about Burnham is that he lacks the ability to formulate a response to the opponents of his economic vision. This would go a long way to explaining why he has invited some of them into his government.

But an opportunity now presents itself, as Paul Knaggs writes:

BP putting its North Sea operation up for sale is not a corporate triumph of “disciplined capital allocation,” no matter how many times the press release repeats the phrase. It is a retreat. A global giant drew decades of private profit from a national asset, and now that the fields are ageing and the easy money is gone, it is walking away. For the British public, this should read as a historic door left open, not a crisis.

After all, have we not always cried out for the means of production? Not as a slogan chanted at a rally, but as a plain question any working household would recognise: who owns the machinery that powers a nation, and who profits when it changes hands? The instinct in Westminster and the City will be to let this pass to a private equity syndicate or a speculative operator, who will promise lean management and efficiency. Britain has watched this film before, in water, in rail, in the care sector. Sweat the ageing kit, thin the workforce, extract the cash, and leave the public to cover the clean up once the value is gone.

The alternative is not radical. It is a purchase. Some on the left, and much of the Green movement, will recoil from any argument that keeps a drop more oil flowing, and the climate clock they point to is real. But there is a difference between opening a new field and deciding what happens to one already producing. BP is not asking anyone’s permission to drill somewhere new. It is asking someone to buy what already exists. The honest choice was never between extraction and abstinence. It sits between a private buyer who lifts what remains and banks the proceeds abroad, and a public one who lifts the same oil and spends the proceeds building the wind farms, the storage and the grid that replace it. Refusing the sale does not put a single barrel back in the seabed. It only decides, by default, who gets to spend the money.

The Great British Energy Heist

And this is not a small find going begging. The Clair field, west of Shetland, is the largest oilfield on the UK continental shelf, the largest hydrocarbon accumulation in Western Europe: seven billion barrels in place. Only a fraction has ever been recovered, and BP has been working towards a third development phase. Whoever buys this business buys the door to that oil for decades to come.

Britain has stood at this door before and closed it. In the 1970s Tony Benn built the British National Oil Corporation to give the public a direct stake in its own reserves, and wanted it to take over BP’s North Sea holdings outright. Harold Wilson refused him, judging it a step too far. Benn’s case was not sentiment; he argued plainly that public ownership meant more money for the country and more control of the oil. Wilson blinked, and the decade that followed sold Britoil and the government’s own BP shareholding, spending the tax windfall as fast as it arrived. A sovereign wealth fund started then would be worth over half a trillion pounds today.

Half a century ago, almost to this same summer, Britain lived this exact moment once before. In June 1975 the first oil from the North Sea was pumped ashore, and Tony Benn, the energy secretary who stood and watched it land, understood immediately what he was looking at. He called it “exactly as significant as the first run of Stephenson’s Rocket… It is a turning point.” He was right, and Britain spent the following decade proving him right in the worst possible way, selling off the very company built to hold that turning point rather than using it. Opportunity on this scale does not knock twice. It knocked in 1975 and was shown the door. It is knocking again now, and the only question left is whether this generation answers it.

Norway ran the experiment we refused, on the same sea. The Norwegian state still owns two thirds of Equinor, and the fund built from the proceeds passed two trillion dollars this year, the largest in the world. Keir Starmer once understood the shape of that failure, promising Labour would not again “fritter away the wealth from our national resources.” That promise gave us Great British Energy, publicly owned and sat in Aberdeen. Widening its remit to hold oil and gas is paperwork next to what this government has already managed. Sixteen days ago it nationalised British Steel, from Act to ownership, inside nine weeks.

None of this should be dressed up as easy. The basin is old, and decommissioning the rest of it will cost the country an estimated forty four billion pounds. Any public bid needs BP’s books open first, every liability accounted for, before a penny changes hands. But look honestly at who carries that cost today. Decommissioning already comes with tax relief running to a third or more, so the public underwrites the clean up whoever owns the platform. Private ownership hands us the bill and hands someone else the oil money. Public ownership gives us the bill we already carry, and the oil money with it.

That choice sits with Andy Burnham now, because his own government has already loosened the ground beneath it. He told Donald Trump he would take a pragmatic line on the North Sea, adding “there is a resource there. When people are struggling we can’t ignore that.” His energy secretary calls the basin “a vital national asset”. Fine words, and true ones. But a vital national asset a country declines to own is only a slogan with a price tag on it.

For a hundred years we were told the means of production could never be ours. On a Friday morning in July, a corporation put them up for sale and proved that was always a choice, not a law of nature. If a country does not own its energy, it does not own its future or its security. If there is any lesson to be taken from Ukraine or Iran, it is that.

Technically Speaking

Commendable though it is that the Prime Minister says “different from”, his Southern miseducation is evident from his reference to a “graduation cap”. A Durham man would have known that that headdress was an academic square, “vulgarly called a mortarboard”, and that it was never, ever to be worn to one’s degree congregation.

But no doubt like Andy Burnham, I was 14 when I chose an entirely academic path. Why not allow a 14-year-old to choose an entirely technical one? Though considerable, the practical obstacles are surmountable. Yet there is a problem in principle with this proposal.

A curriculum determined by “local employers” would be confining even if those were not vape shops, phone shops, nail bars, carwashes, Turkish barbers, and American candy shops, none of which is objectionable per se, but the proliferation of which in certain localities is, well, this time last year I was in HMP Durham. I know.

Britain Has Made Its Mind Up About Nigel Farage

That The Spectator has published this is as significant as the point that Stephen Daisley makes:

No. 10 (North and South alike) will be heartened by polling suggesting that the more the British public sees of Andy Burnham, the more they like him. Leader approval research by More in Common shows Burnham on a rating of plus 19 after just over a week in the job – almost double Keir Starmer’s high point at the end of 2024.

That these numbers are soft should not need saying. The metric that matters is not the public mood during the Prime Minister’s honeymoon but what they think of him once he’s a known quantity, has had to make hard decisions, and is asking for another five years in his own right. That is when we will learn how much of an electoral asset Burnham is to the Labour party. 

I write here to make another point entirely: just look at those Nigel Farage numbers. The same polling gives the Reform leader an approval rating of minus 32. This makes him far and away the most unpopular party leader in Britain, with even the Greens’ Zack Polanski eight points ahead of him. This is Farage’s lowest rating of this Parliament, a relative concept since not a single More in Common poll in the past two years has recorded a net positive rating. Recent reporting on his financial affairs might have contributed to the latest slump, but that wouldn’t account for his long-term, consistent unpopularity.

Farage could escape scrutiny over this while Reform was leading in the polls on voting intentions, but now that Labour seems to be re-establishing a lead, Farage becomes vulnerable. There is a segment of Reform’s base that is essentially a Farage fan club. They will happily overlook questions about donations received and some will even continue to back him if Reform slips into second place – or lower. These are Reformers who find Farage’s anti-woke persona appealing, or rather his perceived facility for riling up Reform’s opponents.

But here lies Farage’s limitations as a potential prime minister: you can’t trigger-the-lefties your way into Downing Street, not when you are this unpopular with the voters. Brits will vote in a prime minister they don’t know – see, for example, Starmer – but will they elect one they don’t like? I can’t think of the last time that happened.

There can be some snottiness around leader approval ratings. ‘It’s not a popularity contest, you know.’ Actually, it is – at least functionally. Elections aren’t moral or intellectual exercises; they are simply a show of hands. We have two solid years of polling – and plenty before that, too – that shows people will not put up their hands for Farage.

In the latest survey, 55 per cent of Brits say he is ‘doing a bad job’, but break that number down further and you will see how dire the polling is for him: among the majority of voters who think Farage is doing a bad job, three-quarters believe he is doing ‘a very bad job’. By contrast, 24 per cent rate him as doing a good job and just 6 per cent reckon he’s performing very well. Meanwhile, Kemi Badenoch is sitting on 31/32 good job/bad job, which is nothing to throw a parade over but at least indicates that the public hasn’t written her off entirely.

Reform doesn’t want to face up to this but will eventually be forced to accept that the British public has long since made up its mind on Nigel Farage. He might poll well with blokes over 55 but, unfortunately for Reform, the rest of the country gets to vote too, and they will not vote for a party led by him. What’s more, they will go out of their way to vote for whoever is best placed to keep Reform out in their constituency.

Farage doesn’t just rub people up the wrong way, he drives them into a tactical-voting frenzy. We talk about red walls and blue walls but the sturdiest barrier in British politics is the ‘anyone but Farage’ wall that Reform keeps banging its head against day after day.

It’s not as though there isn’t a market out there for populism, it’s just that the face of populism can’t be someone so wildly unpopular with the British electorate. Just as the only thing holding back Corbynism was Corbyn, all that stands in the way of Faragism is Farage.

This Critique of the Hypocrisy

Sohrab Ahmari writes:

Conservative Christians in the US obsess about the sins of the bedroom while excusing those of the corporate boardroom. They preach “family values” but ignore how wage and health precarity prevent workers from forming families or spending time with them. They cherish virtue but neglect the economic underpinnings needed to cultivate virtuous souls. And when recent popes have highlighted these failings, the American right has lashed out, accusing the successors of Saint Peter of “socialism”.

If you know your way around the Christian left, this critique of the hypocrisy and myopia of the religious right should be familiar. Remarkably, a version of it is also at the heart of JD Vance’s poignant Catholic conversion memoir, Communion, a book best understood as part of the vice-president’s effort to reimagine what it means to be a conservative Christian — if the Trumpian Republican Party lets him, that is.

Much of the book’s reception has focused on the question of its sincerity, with critics wondering if Vance’s Roman turn has less to do with faith than politics and cultural cachet. Even when lodged by secular writers, such objections reflect the Protestant sensibilities integral to Anglo-American culture.

But what is missed in these debates is the fact that it is a Republican vice-president who has written a book sharply critical of the old religious right, and sometimes even of the culture-warrior new right. Along the way, Vance praises labour unions, calls for a living wage and favourably cites Herbert McCabe, an Irish priest who sympathetically engaged with Marxism.

The question posed by the memoir is why people lose faith. For Vance, part of the answer is conservative Christianity’s obliviousness to the miseries of the working class. This was first driven home for Vance by the church community of his Ohio youth. That community, he recalls, was far more agitated by the Terri Schiavo case — a dispute over whether to pull the plug on a woman in a long-term vegetative state — than his family’s struggle to access healthcare.

Vance maintains this basic critique throughout Communion. As he regains his own faith and turns to Catholicism, he rails against Christian leaders who have “completely ignored questions of economic policy and material wellbeing”. They have no trouble condemning abortion and adultery, he writes, but stop short of telling a chief executive that “he must pay his people a fair wage”.

Yet Christianity — especially Catholic Christianity — makes fundamentally public claims. In Church teaching, as Vance notes, “the economic spheres of our social life” aren’t “quite so separable” from the moral and cultural. Ironically, Vance himself ended up telling Pope Leo XIV to mind his own business (in so many words) when the White House and Holy See found themselves at loggerheads over the Iran war.

There is a still bigger wrinkle, however: Vance’s new vision is still mostly confined to paper. For about a decade, ever since Donald Trump began winning over the workers and the lower middle class, a handful of Republican intellectuals have sought a new agenda to match the party’s new base. In his time in the Senate, Vance tried to own this agenda, for example by attacking the credit card duopoly and pushing for lower insulin prices, often in conjunction with reform-minded progressive Democrats.

His Senate efforts were thwarted — mostly by the GOP leadership, which remains wedded to the old market-fundamentalist agenda. As vice-president, he can claim tariffs and immigration restrictionism as means to tackle unfair trade, offshoring and wage arbitrage carried out by corporate America. But many of the other areas highlighted in Communion remain, well, academic.

Vance laments Big Tech’s power over the young, but Team Trump’s answer has been a law targeting deepfake porn (worthy), a push to shield AI companies from state regulators (not so worthy) and not much else. He denounces the cult of productivity for pushing mothers and fathers to maximise the amount of labour time they have to sell for wages. But a universal entitlement to parental leave isn’t on the administration’s agenda. The tone is set by the likes of Elon Musk, who has praised the Chinese labour market’s long hours. Vance, finally, decries poverty wages, but one has trouble imagining Trump promoting a higher wage floor.

One key question, then, is whether Vance can reconcile the ideas and aspirations laid out in Communion with the realities of the modern Republican Party. On the answer depend not just the spiritual life of one Christian politician but the fate of a party and a nation too.

Against The Warfare State

Andrea Egan writes:

Speaking to members of my union, this country’s biggest, you can’t not come away in awe: of the dedication to public service, the commitment to caring for our communities and the determination to keep going in incredibly tough circumstances. But there’s a flip side. You also always get a vivid sense of our country’s torn social fabric, the terrible state of the services that people rely on.

‘I’m not living, I’m surviving. Every month I have more outgoings than income when it comes to my salary’, said one of our 400,000 members in the NHS. Another told us they are taking strong doses of anti-depressants and cannot sleep because of work-induced stress and fatigue. Here’s a nurse: ‘I have high levels of anxiety and constantly fear making mistakes due to workload and staffing issues. My immune system is poor. . . . but I fear taking any time off due to financial issues.’ Our surveys and conversations with members show that these are typical experiences, not outliers.

It’s not much different in any part of UNISON’s massive public service membership. School support staff love their work but tell us their pay doesn’t cover the rent and that they’ve taken on second jobs in mid-life just to stay afloat. We know from our research that most are only paid in term time and almost half take home less than £1,400 a month. And then there’s my old profession, social work, where you see the full range of miseries inflicted by austerity and economic decline. Unaffordable housing, fragmented communities, and a surreal, cruel welfare system all combine to make life harder both for social workers and for those we’re trying to help.

That’s what life is like for ordinary working-class folk today. That’s the state of our society, and I think it should count as an emergency: a massive threat to the future of our country, which must be the first priority of any government to fix. It should be dominating the headlines. Yet it rarely does.

Meanwhile, demands for more spending on foreign wars and the weapons to fight them are given exactly this kind of treatment. When was the last time we had a nurse or hospital porter handed a primetime slot on the BBC to tell the government that the country faces ruin if they don’t find tens and tens of billions in new investment? In Britain today, that privilege is reserved for top military officials and the politicians who support them.

We already have the sixth highest military spend in the world, with the Ministry of Defence given the biggest capital budget of any department. But you wouldn’t know it from the media. Top military brass — past and present — have been especially relentless in the weeks running up to Andy Burnham taking office. They are trying to pressure the new prime minister into taking on their agenda wholesale, which means cutting everything else to give more to the MoD.

On their broadcast rounds, the military bosses aren’t exactly subtle. We’ve had the former head of the Royal Navy implying free breakfasts for school kids should be scrapped, remarking that ‘things like welfare. . . . are unimportant when you lose a war’. The current UK chief of defence declared earlier this year that ‘Rearmament is not warmongering’. Maybe not inherently. But constantly inflating the threat of war on British soil, and suggesting we must arm to the teeth in anticipation, is absolutely that. It makes war more likely in the name of preventing it.

The ‘defence’ establishment clearly cannot take yes for an answer. Keir Starmer bowed to their demands — which really just tail the demands of Donald Trump — and took their word as gospel. MoD officials never have to shake the tin, no matter how much cash they waste or how many projects they mothball. In February 2025, Labour committed to increasing defence spending to 2.5 percent of GDP by 2027. By April 2026, Starmer had signed on to the NATO target of 3.5 percent by 2035. But it still wasn’t enough: Defence Secretary John Healey resigned in protest, parroting the demands of the military and the Americans. The outgoing PM used his final weeks in office to lock in almost £7bn worth of cuts to crucial government departments to fund his so-called Defence Investment Plan.

In government, Labour has decided to impose a zero-sum fiscal framework on itself. Anyone who suggests breaking with this is effectively blackmailed by the bondholders. That means all the extra billions the Generals take are billions that will not go to our hospitals, schools, local councils, transport, housing: you name it. Rather than getting patients out of corridors and into beds, reopening community centres, funding a dignified social care system or putting money in the pockets of struggling workers, the military will be handed more blank cheques to buy more weapons made in America.

It would be one thing if this debate were actually about defending the country and making its people more secure. But it isn’t. It’s all about serving the destructive foreign policy objectives of the United States. It’s about maintaining a global British military presence — in far-flung places like the middle of the Indian Ocean — that does less than nothing to offer us protection.

Anyone who doubts this should take a moment to reflect on what the military actually spends its money on, from the disasters in Afghanistan, Iraq and Libya to the recent use of UK bases to attack Iran. Not to mention the bombing of Yemen and the assistance given to Israel in its genocide in Gaza. The only outcome has been to subject tens of millions of people around the world to extreme violence and destruction. At the same time, life has gotten harder and harder for our communities here at home.

So I hope the new Prime Minister has the strength to resist the siren calls to defund the British people in order to bankroll more overseas bases and more American wars. We need investment in our people, our services, our socially useful industries. We need to improve lives here, not destroy them abroad. We need to rebuild our country, not collapse other ones. That’s the trade union movement’s agenda, and it’s one we expect Labour to follow.

And Simon Fletcher writes:

We are today in one of the most dangerous periods since the end of the second world war. Extreme warmongering is normalised, and the drive for higher military spending across Europe and the NATO member states is unrelenting.

Behind it all lies pressure from the United States. Indeed, the US Ambassador in London warned Andy Burnham shortly before he became Prime Minister that Britain must move beyond ‘rhetoric’ and make ‘sustained investment’ in defence rather than focusing on ‘other spending priorities.’ The government must not be ‘held up’ by ‘backloading’ additional investment in defence for a later date, he said.

There is no ambiguity here. Some might rationalise support for rearmament on the basis that Donald Trump is an unreliable ally, meaning Europe must now do more to protect itself directly. But the main force driving NATO member states to spend more on arms is the United States itself. The Americans wish, as they have for almost a century, to deepen our dependence by further binding us to their own military-industrial behemoth.

Today, this longstanding American objective is hitched to an aggressive posture, wherein the rearmament of subordinate states like Britain serves not US withdrawal from the world but a strengthened NATO under the thumb of the dominant power. This strategy is centrally geared towards enhancing American military might in the face of China – the principal long-term economic and geopolitical priority in Washington.

A Military Colossus

The Left in Britain cannot hope to avoid this question or simply focus on bread and butter issues alone when the scale of what the NATO countries have signed up to is so enormous. It alters the whole political picture. At the 2025 NATO summit, member states agreed to increase the proportion of their economies spent on defence and national security to 5% of GDP by 2035. This consists of two elements: ensuring at least 3.5% of GDP is devoted to spending on core defence requirements; and spending a further 1.5% of GDP on defence and security-related investments.

The real balance of military power on the planet is already absolutely overwhelmingly on the side of the US and its allies. America alone accounts for one third of all global defence spending. China is way behind at approximately twelve per cent. Russia’s spending is lower than that, at just over six per cent of the global spend. NATO’s expenditure, in other words, is vast compared to the states it talks up most as threats. Just Germany and the UK combined spend more in total than Russia. Depending on which analysis is used, Britain is already either the fifth or six largest military spending state. Rearmament, then, is a monumental effort to reassert Western military power over the rest of the world. 

Wages or Weapons?

With defence spending already so high, and given choosing to spend more on the military means spending elsewhere is sacrificed, we should not be giving an inch to attempts to give rearmament a progressive lick of paint. 

Some in the labour movement have pushed for higher spending on defence, criticising Keir Starmer’s government for not going far enough. But this has a cost. To give an indication of what Britain pushing its military budget up still further entails; the UK’s GDP was £3,037 billion in 2025. One percent of that is just over £30 billion, so 3.5% of GDP is just over £100 billion for the military. According to the government’s own figures, its spending on schools in England in 2026/27 will be £65.9 billion. 

At present, the government’s pay offer for teachers is not fully-funded, meaning that schools will be forced to make cuts – at the same time as the government is debating how fast it can go to meet its military commitments. Choices like this will become the norm of politics. Welfare and wages not warfare, books not bombs, nurses not nukes – these are not just campaign slogans but actual choices in the British economy, as they are elsewhere in Europe. In Germany, climbing military expenditure has now overtaken Britain’s, whilst Chancellor Friedrich Merz is imposing a package of economic retrenchment including tough rules for sick leave and raising the retirement age.

The Labour government wants to show that its commitments on defence spending will bring military-Keynesian benefits, including by stressing a ‘buy British’ element to the contracts. But military spending is one of the least effective forms of investment for jobs and benefits to the wider economy. Economic analysis by Greenpeace focused on Germany, Italy and Spain showed that investing in health, education and environmental technology creates more jobs and growth than defence. Modelling of government spending in the US and Europe laid out in CND’s Alternative Defence Review, meanwhile, demonstrates that public spending on solar, wind, environmental protection and education likewise creates more jobs than military contracts.

‘You Had Better Learn to Speak Russian’

In order to persuade the European working class and its allies to forego jobs, services and improved living standards and to accept a programme of rearmament, a dangerous escalation of rhetoric is underway. In France, Macron has proclaimed a l’économie de guerre (‘we have launched a war economy,’ he declared last week). Here in Britain, Chief of the Defence Staff Admiral Sir Tony Radakin said his message to Andy Burnham was that he must be ‘almost like a wartime prime minister.’ Repeatedly in the media we hear former senior military figures counterpose spending on the military and spending on welfare very sharply. 

‘There’s no point worrying about our welfare if the cities are in ashes,’ General Sir Richard Barrons who led the government’s Strategic Defence Review argued on Sky in May. Former First Sea Lord, Lord Alan West, argued in June that it’s ‘all very well having nice funding for breakfast for children at school, which is important stuff, and other things. But if that means you have to fight a war and lose it, and you have Russians stomping down your streets shooting the children who would have been having breakfast, and that sort of thing, it’s. . . . not a very good swap, is it?’ He told BBC Radio 4 that welfare is ‘unimportant when you lose a war and you have Russian Chechen stormtroopers coming down the street raping women and killing people.’ 

NATO iterates the same hysteria, applying pressure over domestic British political choices with deliberately alarming cold warrior language: Secretary General Mark Rutte warned last summer that ‘if you do not do this, if you would not go to the 5%, including the 3.5% core defence spending, you could still have the National Health Service, or in other countries their health systems, the pension system, etcetera, but you had better learn to speak Russian.’ In a way, Rutte is quite right that there is a choice between arms and socially useful spending, but wrong about the conclusions.

The military lobby’s absurd rhetoric reveals the weakness of its case. Russia has been fighting a war with Ukraine for four years. It is not about to set up military checkpoints outside your local Greggs. Yet the bloodcurdling rhetoric builds the drumbeat of militarism and the spiral logic sets in. Once the military has the weapons; the greater the urge to use them.

Counting the Costs of Rearmament

We are now at a new stage. Efforts to make cuts in some departments’ capital budgets to fund the Defence Investment Plan burst out into open conflict in Keir Starmer’s government. John Healey resigned as the defence secretary over the pace of rearmament — not fast enough, supposedly — hastening the departure of Starmer and Rachel Reeves, whom Healey had fought. In his resignation comment, Healey argued that the Defence Investment Plan meant ‘Britain will still be spending just 2.7% of GDP in 2030, the date when NATO has warned we could face a Russian attack.’ 

Now Healey is the Chancellor of the Exchequer. Andy Burnham has committed his government to increasing defence spending from 2.6% of GDP up to 3.5% by 2035, which The Guardian noted implied a real-terms increase of more than £25bn in less than a decade. The new defence secretary, Wes Streeting, has said that spending more on defence would come at ‘an opportunity cost across government.’ But it is not yet clear how the government intends to meet its targets, or exactly by when.

Andy Burnham’s administration has set out an ambition to reconnect with voters and deliver a ‘circuit breaker for Britain’ after a failed forty-year consensus. Measures such as bus fare cuts or help for pubs and live music venues are rightly welcomed. But at the same time the room to raise productive public investment and better services is massively reduced by the a priori commitment to rearmament. 

Left Ruptures

In the British labour movement, whilst the Unite and GMB unions have lobbied for higher defence spending, the leader of the country’s largest union, UNISON’s Andrea Egan, has strongly opposed it. The TUC shifted position last year through a motion on ‘wages not weapons’ initiated by the University and College Union. A large international conference organised by the Stop The War Coalition earlier this summer was addressed by MPs and trade union leaders.

Rearmament and the question of funding for war has caused ruptures and shifts in the labour movement before. In 1914 it split the entire Second International, effectively killing it. In the 1950s opposition to rearmament gave birth to the Bevanite revolt. In that decade into the 1960s and again in the 1980s huge anti-missiles movement surged through the labour movement, reshaping the politics of the left.

Opposition to the Vietnam War was formative in the creation of a new left. Mass opposition to the Iraq War worked its way through politics and shaped left opinion at the beginning of this century. We do not yet know the longer-term political impact of the genocide against the Palestinians but the sustained movement in opposition to Israel’s war and Britain’s complicity has already profoundly affected the political landscape, including within Labour’s electoral base. We are now only in the foothills of the political impact of rearmament; historic political arguments over it are now inevitable. 

The left, inside and outside parliament, in Labour and not, must recognise that the choices and conflicts caused by rearmament are an unavoidable reality of the current phase of politics; and must organise its actions, priorities and programme accordingly – including its economic programme – so that concerted opposition to rising military spending and warmongering is a central priority.

The Betrayal At The Heart

Paul Knaggs writes:

The Oldest Story in the Labour Movement Has a New Chapter, and It Stinks 

In 1874, a bookbinder named Emma Paterson founded the Women’s Trade Union League because the unions of her day would not organise women. This is not a new story. It is, if anything, the oldest story in modern history, and not only in the labour movement. Men shut the door. Women build their own room. 

Those rooms worked. Mary Macarthur built the National Federation of Women Workers for the women the established unions would not take, and in 1910 the women chainmakers of Cradley Heath struck to force employers to honour a minimum wage the law had already granted them. They won. The movement absorbed their victory into its mythology and has been proud of it ever since. That is the pattern, and it repeats: women organise separately because the general movement has neglected them, they win something nobody else was fighting for, and afterwards the movement discovers it had always believed in equal pay. Women are welcomed as symbols, celebrated on anniversary posters and praised from conference platforms. The warmth disappears when they organise as women, identify their own interests and refuse to surrender control of the room. 

It is disappearing again now, in the run-up to Liverpool. 

UNISON, ASLEF, USDAW and the Musicians’ Union are boycotting Labour’s Women’s Conference because its formal proceedings are reserved for women. The seats they leave empty do not belong to four general secretaries, a policy committee or a press officer at union headquarters. They belong to the female members whose subscriptions paid for them. 

That is the betrayal at the heart of this dispute. Union leaders have taken political representation purchased by women workers and thrown it away to make an ideological gesture against women organising as a sex. 

Labour’s Women’s Conference will take place in Liverpool in September. Transgender members may attend fringe meetings, receptions and exhibition areas, but only women will participate in the main conference proceedings, debate policy, vote on motions and elect representatives to the National Women’s Committee. Labour says the arrangement reflects the Supreme Court judgment on the meaning of sex in the Equality Act and the party’s legal obligations. The four unions have responded by refusing to send delegations, while confirming that their attendance at Labour’s main annual conference will continue as normal. 

Of every room available to them, they chose to empty the women’s room; it is an attack on women and women’s voices. 

Steelmanning

Recently, I have made a habit of steelmanning the arguments this column takes on: giving the other side its best case, stated fairly, before answering it. On this occasion, the word earns its own pun, because the case being steelmanned is, at bottom, the case of men. Here it is at its strongest. Trans women previously took part in Labour’s women’s structures, some transgender union members will experience the change as exclusion, and trade unions carry a duty to protect those members from harassment and discrimination. That duty remains. Trans people continue to possess legal protection under the protected characteristic of gender reassignment.

None of that abolishes sex, nor does it give trade union executives the right to confiscate women’s political representation. Strip away the language of inclusion and what remains is a choice: these unions have placed the concerns of men who identify as women above the material realities of women. That is the priority they have set, and they should be made to own it in those words.

The Supreme Court settled the legal meaning in April 2025. References to “woman”, “man” and “sex” in the Equality Act concern biological sex, while protections against discrimination for transgender people remain intact. The Government laid the revised EHRC code before Parliament on 21 May, its scrutiny period ended on 9 July without challenge, and the commencement order has been made: the code comes into force as statutory guidance on 5 August, days after these unions announced their boycott. They are not confronting an unlawful Labour exclusion. They are protesting because Labour has finally accepted that a women’s political structure must be capable of identifying the class of people it was established to represent.

The word ‘women’ cannot perform any political work if it is forbidden from describing women.

A women’s conference exists because women experience material conditions arising from their sex. Pregnancy discrimination is not allocated according to identity. Maternity penalties do not descend upon men who feel insufficiently represented. Women remain disproportionately responsible for unpaid care, more likely to work in low-paid public services and more vulnerable to particular forms of sexual violence and workplace harassment.

These are not abstractions assembled for a diversity seminar. They shape the wage packet, the pension, the night shift, the maternity meeting and the changing room. Women require the political freedom to discuss those conditions together and organise demands around them. That freedom is an exercise in collective assembly, the very principle on which trade unionism stands. 

That history makes UNISON’s position particularly indefensible. The union describes itself as containing one million women, around 80 per cent of its membership, and has promoted the claim that without women there would be no UNISON. It also maintains a women members’ group whose stated purpose is to campaign against workplace inequality and advance women’s rights. Yet when Labour provides a conference at which women can debate precisely those matters, UNISON refuses to represent them. 

No publicly available statement from the union shows that its million women members were balloted on surrendering their delegation. UNISON’s explanation is a single sentence: restricting the conference floor to women conflicts with its policy on trans equality. ASLEF, USDAW and the Musicians’ Union have offered no publicly demonstrated mandate from their female membership either. A policy written elsewhere has simply been placed above the right of women members to participate. 

That is not representation. It is substitution, the executive’s politics placed where the members’ voices should have been. 

Labour Women’s Declaration

The Labour Women’s Declaration is a seven-point political statement launched in November 2019 by members of the UK Labour Party. Its stated aim is to protect women’s sex-based rights, single-sex spaces, and the use of biological definitions of sex within policy and internal party structures.

The Labour rulebook has allowed an affiliated organisation one delegate for every 10,000 members, up to a maximum of 25. Trade union delegates also elect representatives to Labour’s National Women’s Committee. Boycotting therefore means more than missing speeches and sandwiches in Liverpool. It removes votes, influence, committee representation and the ability to shape the policies later carried into Labour’s wider conference machinery. 

Power does not disappear when a union walks out. It passes to those who remain, and if the unions won’t use it, then women must organise themselves. 

The female cleaner, care worker, teaching assistant, shop worker, train driver or musician does not gain anything from this performance. Her union does not become more principled by silencing her. She simply loses a representative in the room while continuing to pay the subscription that funded the empty chair. 

UNISON’s conduct in the Darlington nurses’ case shows that this boycott is not an isolated error. It belongs to an established political choice. 

Eight nurses at Darlington Memorial Hospital brought employment tribunal claims after they were effectively required to share their female changing room with a biologically male colleague who identified as a woman. The tribunal found that the trust had prioritised the perceived rights of its transgender employee over those of the nurses, leaving the women with no genuine alternative changing provision. It concluded that the policy violated their dignity and created a hostile, humiliating and degrading environment. 

Seven of the nurses later received a combined £187,000 in damages, together with an apology from the trust and a commitment to provide separate changing facilities for male and female staff. 

UNISON was not the organisation standing beside them. The women had to secure outside legal support and establish the Darlington Nursing Union. Before the tribunal ruling, UNISON president Steve North accused the then health secretary of pandering to anti-trans bigotry, merely for meeting the nurses. After the judgment, UNISON issued a statement saying it needed time to consider the lengthy decision and reaffirming its existing policy on trans, non-binary and gender-diverse members. Its published statement did not offer solidarity to the women whose dignity the tribunal found had been violated. 

That record matters. It tells female members what may happen when their rights collide with an ideology already adopted by the union hierarchy. Their union may decline to represent their position, condemn the politicians who listen to them and then issue a carefully sterilised statement after a court vindicates them. 

Now the same hierarchy is applying that choice on a national scale. 

The boycott also carries financial weight. UNISON gave Labour close to one and a half million pounds before the 2024 general election, USDAW more than half a million, ASLEF a hundred thousand. None of the four unions has publicly threatened to withdraw Labour’s funding over the conference. They do not need to spell out every implication. When several affiliated donors coordinate a public walkout, the party leadership knows which ledger is being placed on the table. 

That makes the dispute a test of whether Labour will defend women’s lawful political organisation when organisations holding money and institutional influence demand otherwise. It is also a test for the trade union movement. A union exists to represent its members against concentrated power, not to use concentrated power against its own members. 

The women paying subscriptions to these unions are entitled to ask who authorised the boycott, which governing body approved it, whether women members were consulted and what democratic process allows their conference representation to be surrendered. Those questions should be tabled in branches, recorded in minutes and directed to every executive member responsible. Where leaders refuse to answer, women should organise to replace them.

Emma Paterson did not wait for established organisations to discover their consciences. Mary Macarthur did not tell women chainmakers to accept that somebody else’s policy took precedence over their wages. The Darlington nurses did not remain quiet when their own union failed to defend them. Each generation of women has been forced to organise because institutions claiming to speak for everyone decided that women’s interests could be postponed, diluted or exchanged.

The executives of UNISON, ASLEF, USDAW and the Musicians’ Union have made that same decision. They have placed ideological conformity above female representation and called the resulting silence inclusion.

Women’s rights were never a man’s to grant. They are not a union’s to boycott or betray.

Stop Lowering Our Sights

Bernard Lovell founded Jodrell Bank under a Labour Government, indeed under the Labour Government, of which it was very much in the spirit. With that caveat, Ameer Kotecha writes:

Why is the UK shutting its iconic space telescope? The news that Jodrell Bank, which hosts the largest telescope in Britain, is to be closed, after the government scrapped funding for the facility, has been greeted with widespread outrage. The Royal Astronomical Society said it was ‘shocked and dismayed’. I’m angry and depressed.

Jodrell Bank is a serious bit of kit. The Lovell Telescope – 76 metres in diameter – is the world’s third-largest, fully steerable dish radio telescope. In the Cold War, it tracked Sputnik. Just last year, GCHQ revealed the secret role Jodrell Bank played in the space race, working with the intelligence agency to intercept signals from satellites, orbital weapons and space probes. The dish continues to conduct world-leading radio astronomy. It has researched black holes and the afterglow of the Big Bang. Just last week, experts demonstrated that the telescope could track space debris.

The mooted closure is reportedly the result of cuts to the government’s physics and astronomy research budget. The UK Research and Innovation (UKRI) has decided that, when the current funding agreement ends in March 2028, it will stop supporting the entire e-Merlin network – a group of seven UK radio telescopes, including the Lovell at Jodrell Bank. Together, they make up one of the world’s most important networks for astronomical observation. Manchester University, which helps run the observatory, said it would be ‘difficult to sustain’ the telescope without replacement funding.

At present, Jodrell Bank receives just £2.8million a year. That is peanuts. Never mind that the facility represents just 0.03 per cent of UKRI’s annual budget. As a country, we recently spent £100 million on a bat tunnel for HS2. We spend £300 million a day on debt interest. By the time you’ve read this article, Britain will have spent more servicing its national debt than it would cost to keep Jodrell Bank operating for an entire year. We spend £9 million a day on asylum accommodation. But then, who needs to search for alien life when we have illegal aliens arriving on the south coast who need housing?

The decision to close such an iconic facility, which costs such a measly amount to run and which clearly punches so significantly above its weight, provokes genuine bafflement. Perhaps, as one weary soul on X suggested, it had been given the chop because the telescope is white.

But seriously, how can the UK credibly claim to be the best place in the world to do science, let alone want to lead the technologies of the future, while choosing to close internationally respected research infrastructure that costs what amounts to a rounding error? The UK has managed to become a significant global player in radio astronomy thanks to just a handful of globally significant sites, including Jodrell Bank and the Mullard Radio Astronomy Observatory near Cambridge. That leadership is now seriously imperilled. And how is it that UKRI, an organisation whose budget will reach £10 billion by 2030, cannot find a couple of million for one of its most iconic and important facilities?

When I was growing up, getting my hands on a telescope came second only to a metal detector (so I could go up and down the garden looking for buried treasure). Big telescopes are the sort of thing that capture children’s imagination. If Andy Burnham really wants to encourage kids from working-class communities to dream big and reach for the stars, being able to see them would be a good start.

Of course, the message this sends internationally is pitiful. As China expands its scientific capability and the US continues to invest heavily in frontier science, we are scrapping what assets we have to fund ever more handouts and international aid, including to countries like Pakistan – which has its own space programme.

Like death by a thousand cuts, national decline comes through many small choices that quietly signal a scaling back of ambition. Closing Jodrell Bank is that sort of choice. One waits to see whether Burnham will step in, in response to the backlash – the facility is, after all, just outside Manchester and near his constituency.

We need to decide whether we still want to be the sort of country that dreams big and plays its part in discovering the great questions of life – or just be a welfare state with a country attached. We should stop lowering our sights and instead look to the stars.