New Times,
New Thinking.

Chris Williamson’s resignation is a sign of things to come

Labour’s tight fiscal rule means that junior ministers will be keen to find money somewhere to fund their pet projects. 

By Stephen Bush

Chris Williamson has resigned his post as shadow junior fire minister after he called for councils to be given the power to double taxation on the most valuable homes in an interview with the Huffington Post.

The resignation is interesting for a number of reasons. The first is that Jeremy Corbyn dislikes firing people and has an immense sense of fidelity to those who have stayed loyal to him. Williamson backed him from the very beginning and was one of the vanishingly small number of parliamentary candidates – including those with otherwise impeccable Corbynite credentials – to have included the Labour leader on his election literature even at the very nadir of his unpopularity. I’d usually roll my eyes at suggestions, from several well-placed sources, that the departure was mutual but in this case it feels likely.

Corbyn’s aversion to sackings is one reason I would be surprised in the extreme if this was the prelude to a wider reshuffle – as I wrote in my column last week,  the Islington North MP has little appetite for one. But similar controlled explosions like this one might become the norm.

Why? Because one of the consequences of Labour’s forward advance at the last election is that they have the air of a government-in-waiting that their poor polling and the very bad 2015 result combined to deny them in the last parliament. That means that shadow ministers can no longer go “off piste” without making news or being dismissed as cranks. Although the leader’s office has a greater control over party processes than it did before June – Andrew Fisher, Corbyn’s policy chief, is now the boss as far as shadow cabinet staffers’ contracts are concerned, not as before, Simon Jackson, his opposite number in  party HQ – it still has a fairly laissez-faire approach. I’m reliably informed by several sources that Angela Rayner’s Spectator interview, in which she described Labour’s approach to solving the problems of the British economy as a “shit-or-bust” was not cleared with the leader’s office beforehand nor was Williamson’s bit of thinking out loud.

Rayner in a way got in trouble for merely expressing in colourful language what all of Labour’s core four – Corbyn himself, Diane Abbott, John McDonnell and Jon Trickett – have said themselves: that the United Kingdom is at a crisis point and requires radical measures to solve it. Williamson however was doing something very different: floating a policy way outside his brief, and one that would see taxes increased at that.

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Tax-and-spend is going to be a particularly difficult area for Labour over the next four and a half years. McDonnell’s fiscal rule – a blank cheque as far as infrastructure spending is concerned but the books must balance as far as day-to-day spending goes – means that outside of infrastructure the spending decisions are quite tight. One challenge for the shadow welfare team is that they have no money to spend which means they can oppose the government’s handling of universal credit but they can’t easily propose an alternative. The two most expensive decisions in the manifesto – to match the Conservative cut in the 40p rate and the abolition of the tuition fees – were both vindicated in that Labour increased its share of the vote among people earning £45,000 and up, the immediate beneficiaries of the cut, and did even better among people aged 18-24, but that places quite sharp limits on what it can spend elsewhere unless it can find some new ways of getting money off people or commits to a far larger level of borrowing than it did in 2017.

There was also in general an expectation during the meetings to approve the manifesto in 2017 that there would be a leadership election in fairly short order so there was no point fighting too strongly for extra cash. Rayner was one exception and her rows with McDonnell for extra money for early years were one of the few pre-election rows that made it to the press. But several other spending departments are now bitterly regretting not doing the same. Backbench MPs, too, are likely to be increasingly vocal about the need for more money on their areas of interest. (In particular, I would be surprised if there wasn’t at least some loud pressure for the Shadow Treasury team to find some more money to end the welfare cap.)

So you can expect more of this kind of thing in the future. 

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