Reeves's spending plans were very popular with one key group: Labour MPs

Telegraph

a day ago

Labour MPs liked it, and perhaps that should tell us everything we need to know about Rachel Reeves's spending review announcement in the Commons.
Their enthusiastic shouts of 'More!' as the chancellor reached her peroration sounded genuine enough. And why wouldn't they? No chancellor of the exchequer ever became less popular by announcing large amounts of dosh for public services.
Reeves painted a rosy picture of the future, a far cry from her and her boss, Keir Starmer's initial outings at the despatch box in the aftermath of last year's general election, when made Private Frazer from 'Dad's Army' sound like a ray of sunshine. They've since taken the hint and decided that a return to Labour's traditional practice of throwing loads of cash at everything helps cheer everyone up – particularly stressed Labour back benchers.
One of the few cash saving schemes within her statement was perhaps not so popular with Labour MPs, and certainly not with party activists listening at home: the asylum backlog will be cut (but there was no indication of the likely scale of this cut or whether the threshold for achieving official refugee status will be lowered in order to reduce the official numbers of asylum seekers), more appeal cases will be heard and those who have no right to be here will be returned. A manifesto commitment to end the use of hotels by asylum seekers will be met by the end of the parliament, saving a billion pounds for the Treasury.
But the biggest cheers from the government benches came in response to Reeves's announcement of £39 billion for new social and affordable house building. The deputy prime minister, Angela Rayner, looked especially pleased at this, which is unsurprising since her own department has responsibility for meeting her party's promise to build 1.5 million new homes by the time of the next election.
But the £39 billion pledged today was not for spending in the next three or four years left of this parliament: it was for the next 10 years, which means, assuming broadly equal levels of spend each year, less than £16 billion to be spent on the project before the deadline mandated by Labour's own manifesto looms.
Oddly, for a party with only five MPs, Reform UK and its leader came in for a disproportionate amount of attention from Reeves. Nigel Farage was targeted for having expressed support in the past for Liz Truss's disastrous 'fiscal event' and the unfunded tax cuts that accompanied it. It seemed odd that Reeves and her allies thought there was still mileage left in an event that happened three years ago. Maybe they'll fight next year's May elections by attacking Margaret Thatcher's poll tax.
And by the time the chancellor got round to announcing the inevitable 'record' budget increases for the NHS – three per cent in each of the years covered by the spending review – she had come up with another zinger, reminding the House that Farage had once expressed support for an insurance-based health system. This might not be as productive a line of attack for the government as it blithely assumes. Given the consistently poor performance of the NHS over many years, and given that no one seriously expects things to improve, however much extra cash is thrown at it, it is not inconceivable that the kind of angry and disillusioned voter that Reform has successfully attracted to its ranks could be persuaded that maybe a different approach is, after all, worth considering. After all, most EU countries have some sort of insurance element within their funding models, yet they also manage to provide medical care free at the point of need. And aren't Labour MPs fans of everything Europe does (apart from regularly electing far-Right parties to government, of course)?
The real success of fiscal events like today's can never be accurately judged until hours after everyone has left the chamber and headed to the tearoom to chat about it and stock up on publicly-subsidised calories. But even before the economics experts have had a chance to go over the details, Chancellor Reeves can congratulate herself for at least sounding more like a cheerleader for the government, rather than an undertaker. Baby steps, chancellor. Baby steps.