Four quick takeaways from Keir Starmer’s big speech on the economy

Keir Starmer delivered a speech in Liverpool this morning, focusing on Labour’s plans for economic growth. Below are four quick takeaways from his address…

1. ‘It’s the economy, stupid’

The Labour leader’s argument today was simple – Britain has experienced low growth under the Tories and Labour will reverse that low growth. He has established his chosen battleground for the election: the economy. Starmer knows that trust (or mistrust) on the economy is, as always, going to be a key motivating factor in whether people back Labour at the next election. A recognition of that can be seen in the guiding principles laid out for those watching today:

1. “We will be financially responsible;
2. “We will be distinctively British;
3. “We will work in partnership with business;
4. “We will re-energise communities and spread economic power; and
5. “We will refocus our investment on boosting productivity.”

Each is designed to clearly contrast with the what the public is seeing from the Conservative leadership election. Labour has repeatedly attacked to the Tory hopefuls for their ‘fantasy’ economics and today was no different: “Boosterism and fantasy economics are not the same as ambition.”

He is determined that Labour be seen as sensible on the economy and this drive will inform policy. “Growth, growth, growth” is the leadership’s mantra now – and every policy is going to be directed to achieving this end. As he said: “I have told the shadow cabinet that every policy they bring forward will be judged by the contribution it makes to growth and productivity.” The language of economic responsibility and growth will feature in discussion of every policy area.

2. Economic responsibility and net-zero emissions go hand-in-hand

That was apparent in his mention of the climate emergency today. According to Starmer today, Labour “will not be distracted by the siren calls – from the right or the left – that say economic growth and net-zero do not go together”. The Labour leader said this morning that he rejects “completely” that the two objectives are in tension: “A plan for net-zero needs growth. A plan for growth needs net-zero.”

There is “no bigger business risk” than the climate emergency, Starmer said, highlighting the difficulties experienced with the country’s infrastructure during the heatwave last week. He stressed, however, that tackling climate change is also a “clear opportunity to create wealth in the here and now”. He added: “Some nation is going to lead the world in electric vehicles, in floating off-shore wind, in new hydrogen and nuclear technologies. Why not Britain?”

3. Starmer will “challenge the instincts of his party”

Starmer told those watching today that he is setting out a “new approach” – so that Labour can truly give Britain the “fresh start” he says it needs. This approach, however, is not just going to be new for the country – but new to his party. The Labour leader issued a warning to his own colleagues today that the way in which he plans to “reboot the economy” may make them uncomfortable.

“The approach to growth I have set out today will challenge my party’s instincts. It pushes us to care as much about growth and productivity, as we have done in the past about redistribution and investment. Not to hark back to our old ideas in the face of new challenges,” the Labour leader said.

Starmer recently upset the left within Labour when he declared that the party had “put to one side” the 2019 general election manifesto and declared that Labour would be “starting from scratch”. As LabourList reported at the time, Starmer announced last year that Labour’s policy review would not use the 2017 or 2019 manifestos as its starting point. As we head towards conference season, the leadership will be preparing to set out his alternative. Today is an indication that there is more to come that his colleagues on the left of the party will not like.

4. Starmer is making no big promises on nationalisation

A good example of where the new approach is causing tension is nationalisation. Shortly before the Labour leader gave his speech this morning, Rachel Reeves appeared to disavow nationalisation of rail, water and energy. A party spokesperson clarified afterwards that the party remains “pragmatic” on the issue (after it was first reported that the Shadow Chancellor had misheard the question).

Keir Starmer echoed this when challenged on the issue after his speech today. “My approach here is, is pragmatic, not ideological,” he said, adding specifically on bringing rail back into public ownership: “Whether it comes to rail or anything else, I want to be pragmatic about this rather than ideological.

“I think what some of our mayors and metro mayors are doing with public transport is the right way forward, absolutely focused on keeping the price down and making sure there’s control over where things go, particularly buses recently.”