Keir Starmer faces the awful truth: Labour’s policy cupboard is bare – Rishi Sunak’s stolen them all

The Labour leader concealed his embarrassment well in Prime Minister’s Questions yesterday. His problem is that the natural law of two-party politics has reasserted itself, and he finds himself facing the opponent he most feared.

Rishi Sunak is a one-nation compassionate Conservative whose policies are more or less what Keir Starmer has been demanding. The prime minister hugged the 2019 Tory manifesto close, because it is his talisman of Tory unity, but it also has the advantage against Labour of being a remarkably Blairite document.

When Sunak spoke in Downing Street on Tuesday, he offered a 37-word summary of it: “A stronger NHS; better schools; safer streets; control of our borders; protecting our environment; supporting our armed forces; levelling up and building an economy that embraces the opportunities of Brexit, where businesses invest, innovate, and create jobs.”

Apart from the mention of leaving the EU, that is a precis of the Labour manifestos of 1997, 2001 and 2005, in the cadences of Blair’s Clause IV of Labour’s constitution. And embracing the opportunities of Brexit is not far from Starmer’s “making Brexit work”.

So it was no wonder that the policy difference Starmer chose to emphasise in his first questions to the new prime minister was Labour’s plan to abolish non-dom status. It is hardly a genuine policy difference, though; more of an excuse for a personal attack on Sunak’s wife, Akshata Murty. The Labour government kept non-dom status because, as Ed Balls, the shadow chancellor, explained in the 2015 election, it helps to attract the globally mobile rich to settle in the UK and set up businesses here.

It wouldn’t raise a significant amount of money – probably none in the medium term, as Balls suggested – but it is useful for Labour not just because it can be dressed up as “definitely not a personal attack on Sunak’s family”, but also because the party desperately needs sources of revenue, however trivial, to try to reinforce its armour-plated fiscal prudence.

I would not be surprised, though, if Jeremy Hunt were to announce the “abolition” of non-dom status in his Autumn Statement on 27 November. It is antiquated and sexist (it depends on where your father was when you were born), and could be modernised and renamed.

For a brief seven weeks, Labour enjoyed the luxury of clear policy differences between it and the government, in which Starmer and Reeves were on the side not just of all that is right and pure, but of public opinion and even of basic arithmetic. But now that the Tory party has returned from what Michael Gove called its “holiday from reality”, Labour has discovered that its policy cupboard is bare. Sunak has stolen them all.

Most of Liz Truss’s tax cuts have been reversed, and the windfall tax will almost certainly be extended in Hunt’s Autumn Statement, just as Labour demands. With all the dead foxes in her way, Rachel Reeves, the shadow chancellor, might struggle to get to the opposition despatch box to reply.

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All she and Starmer are left with is fiddly schemes and slogans. Taking away charitable status from the minority of private schools that have it, and putting VAT on school fees, is going to raise, to the nearest billion, nil. Other than that, Labour doesn’t have any revenue-raising policies, but it has a strict policy of no unfunded spending commitments. As a result, it doesn’t have any spending promises either. Just some feelgood phrases: Great British Energy and a Green Prosperity Plan.

For the moment, this policy convergence may not matter. The Conservatives have done such a good job of tarnishing their reputation for economic competence that Labour doesn’t need to offer different policies: it can merely promise to implement the ones both parties agree on more competently.

Sunak may enjoy a small recovery in the opinion polls from the record-breaking depths that the Truss bathysphere plumbed, but the economic outlook for at least the next year looks so difficult that his government will be blamed for people’s financial hardship. Even so, two years is a long time to the election, and if the economy starts to recover in 2024, Starmer may wish he had restocked that policy cupboard.