Blair’s Bombshell
Are there ears to hear the former prime minister’s Fire Sermon on what Labour must do to remain viable?
Labour’s most successful former leader, Tony Blair, has just thrown a hand grenade into the stuttering Labour leadership race. In a five-thousand-word j’accuse, published by his Institute for Global Change, Blair criticizes the tax-and-spend orthodoxy of the current Labour Prime Minister Keir Starmer while also excoriating the radical posturing of his wannabe challengers, Wes Streeting, the former health secretary, and the favorite, Andy Burnham, the mayor of Greater Manchester.
Blair, who was the UK’s prime minister from 1997 to 2007, warns all three of them that their retreat into Labour’s “comfort zone” of high taxation and low growth will be fatal to Britain’s economic welfare and his party’s electoral prospects. “The Labour Party is playing with fire,” he writes, “or, more accurately, with its future, and that of the country.”
This is just what all three politicians in the Labour leadership imbroglio did not want to hear—the more left-wing Burnham especially. Blair’s intervention could damage his chances in the forthcoming Makerfield by-election, the vehicle through which Burnham hopes to return to the Commons and replace Starmer in Number 10 as early as next month.
This is because Tony Blair, who won three consecutive general elections as Labour leader, tells him that on many of the key issues of policy, the Conservatives under Kemi Badenoch and even Nigel Farage’s right-wing Reform UK are more correct than they are—though naturally he doesn’t say this in so many words.
But consider the issues Blair focuses on. He condemns the phasing out of the oil and gas industry and calls for drilling to resume in the North Sea. This is an issue Reform UK has made its own in recent years. Blair wants to reverse the policy “which prioritises clean energy over cheap energy.” This is a direct attack on the Labour Energy Secretary Ed Miliband, who is legislating to make it illegal for Britain to even explore for oil and gas in the North Sea in future. Miliband’s reckless suppression of fossil fuels has already led to British industry paying three times as much for electricity as its American competitors.
Blair also attacks the recent increases in taxation on business, such as Chancellor Rachel Reeves’s hike in Employers’ National Insurance contributions. Blair says of this that “it appeared as if we were increasing tax to pay for additional welfare spending, when the public already thinks welfare bills are too high.”
Britain now spends more on welfare than is raised by income tax. Like Badenoch, Blair says that the benefits bill is unsustainable and that current policies “incentivise people not to work.” He calls for “fundamental reform” of the benefits system and also—here, shades of Farage—says Keir Starmer should “do whatever it takes” to solve the illegal immigration crisis.
He also echoes Conservative critiques of Starmer’s anti-business measures, such as increasing the National Minimum Wage above inflation and the Workers’ Rights Bill that gives employees protection against being sacked from day one. Blair condemns Starmer for blowing “headwinds” against British business, whose support he needs to address Britain’s dismal economic growth.
Blair recognizes that leaving the European Union probably damaged the British economy, but intriguingly he is not asking for a resumption of the divisive Brexit debate. Both Burnham and Streeting have said they would like Britain to rejoin the EU. Instead, Blair urges whoever emerges from the leadership tussle to seek to reduce “friction” with Britain’s largest trading partner, but only to do so from a “position of economic strength.”
Blair talks a lot about strength. He wants Britain to cut welfare, rebuild defense, back America, and liberate private enterprise. He says the country must not “spend more on… disability benefits than defence.” He says the UK risks being left behind in the AI revolution despite having an early lead in the technology, and he says the machinery of government needs to be reconstructed from top to bottom to promote economic growth as priority
Blair says he is calling for a return to policies of the “Radical Centre,” but it is impossible not to see strong similarities here with the agendas of both the UK Conservatives and Reform UK. They both prioritize growth, curb net zero, drill in the North Sea, restore defense, and promote private enterprise. So Blair’s prescription will instantly prove unacceptable to the Labour Party as it is currently constituted.
There is no prospect of the influential former Deputy Prime Minister Angela Rayner telling Labour’s trade union paymasters that she is going to scrap the Workers’ Rights Bill or reverse tax increases. Labour backbenchers, many of whom come from the charity/NGO world, will never accept cuts to welfare, as they demonstrated last year when they blocked even minor changes to Personal Independence Payments, now claimed by 4 million people.
Ed Miliband remains hugely popular with the Labour Party membership and regularly comes top of their favourite cabinet minister charts. It was widely rumored that Starmer tried to move the net zero zealot to another cabinet brief last year, but he simply refused. He has been supporting Burnham’s candidature for the leadership and expects him to persevere with the ban on oil and gas.
Burnham hopes to win the Makerfield by-election next month and return in triumph to the House of Commons, where he expects to be acclaimed as Labour’s savior. Starmer’s popularity ratings are appalling, and Labour lost nearly 1,500 seats at the local government elections earlier this month.
But Blair’s bombshell critique of his policies will surely have an impact on Burnham’s chances in Makerfield, if only negatively. The latest opinion poll placed Burnham only three points ahead of the Reform UK candidate there. Farage says he will throw everything at the by-election, and he will be able to use chapter and verse from Labour’s most successful leader in his attack on Burnham’s leftism.
Blair says that Labour is “playing with fire” if it adopts the left-wing policies of the mayor of Manchester. Burnham has made no secret of his wish to spend more, increase taxes on wealth, and even increase borrowing if he becomes prime minister. He famously said in January that Britain “should not be in hock to the bond markets” (though he has since said he will stick to “fiscal rules” after the bond markets bit back).
There will, however, be a fierce reaction from the Labour left, many of whom have long regarded Blair as a “neoliberal” who would privatize the NHS and as a warmonger for his support for the Iraq War in 2003. Blair does indeed call for the government to extend the use of private healthcare in the NHS, and he still supports the “transatlantic relationship” with Donald Trump, while disagreeing with the president’s rhetorical style.
This is not what Labour MPs want to hear. They see their support draining away across the country as many working-class voters defect to Reform. They know there is a problem. But many would rather reaffirm their progressive moral certainties than accept the kind of compromise with capitalism that Blair says is necessary for their survival. Labour is the ultimate declinist political movement, and would rather go down than go right.
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