What is happening?

Labour leader Sir Keir Starmer revamped his frontbench on Monday, in a reshuffle ahead of an annual party conference in October, fine-tuning his team for what is likely to be the final time ahead of the next general election. The reshuffle has seen promotions for the likes of Hilary Benn and Liz Kendall, with notable demotions for Lisa Nandy and Jonathan Ashworth.

Starmer looks to have stamped his authority on the Labour Party. He has appointed strong communicators for a gruelling election year, along with talented and experienced names, so that the party is ready to govern from day one. His previously botched reshuffle, from a position of weakness, saw him try to remove Angela Rayner, who instead emerged as the Shadow First Secretary of State, Shadow Chancellor of the Duchy of Lancaster, and Shadow Secretary of State for Future of Work. This time he has shown a willing ruthlessness. Lisa Nandy has been demoted despite previously being a leadership contender and holding positions such as Shadow Foreign Secretary. Rayner, deputy leader of the party, has given up the responsibility of shadowing the Cabinet Office to become Shadow Levelling Up secretary. This reshuffle has followed Starmer’s pattern of removing allies of Corbyn that he inherited from his shadow cabinet, which featured rising stars Anneliese Dodds, Lisa Nandy, and Nick Thomas-Symonds. Dodds was removed first, and now Nandy and Thomas-Symonds have both been shuffled downward. Jonathan Ashworth, one of the few to keep his job after Starmer succeeded Corbyn, moves into the less senior role of Shadow Paymaster General.

Also noticeable is the promotion of five former special advisers to former Prime Minister Tony Blair. One of these is Pat McFadden, replacing Angela Rayner in the role shadowing Oliver Dowden as Chancellor of the Duchy of Lancaster. This is a flexible role, but he will act as labour’s national campaign coordinator, and then be responsible for the everyday workings of government if and when elected. He was sidelined during the left-wing leadership of Starmer’s predecessor Corbyn, but has since been handed the role of chief secretary to the Treasury in 2021, where he has been a key advocate of fiscal discipline within Labour. This therefore is a ‘Blairite’ cabinet, demonstrating Starmer’s control over the party, as he has prioritised those from the right flank of the party who are ideologically aligned, despite the discontent he can now expect from the left.

What is in it for you?

Given current polling, this shadow cabinet is likely to be the next cabinet in government. Labour is consistently ahead of the Tories amid a collapse of Tories in the ‘red wall’, the Lib Dems challenging in the ‘blue wall’, and an implosion of the SNP in Scotland. Labour is polling at 45% as opposed to the Conservatives, who are at 27% as of September 4th. Polling by YouGov also projected that Labour is on track to take 23 seats from the SNP at the next election, another major boost for Starmer.

Given the ‘Blairite’ influence of the cabinet, this government can be expected to be serious about fiscal restraint and public service reform. Having said that, it should also be considered that they will be lobbied by the left of the party on the backbenches for more left-wing policies and increased spending. Their power will depend on the size of the Starmer’s majority. He has now taken control of the candidate selection process, so newly elected Labour MPs will be aligned with his wing of the party.

As a business, these developments show that Labour is serious and ready to govern. The shadow departmental set-up is now also largely in line with the current government, a move that should mean a smoother transition of power, as reversing the recent changes made by Rishi Sunak would be a costly and time-consuming post-election task. With pre-election access talks between the labour and the civil service likely to start by January, Starmer is aiming to ensure that plans and policy can start to be developed now. Businesses should engage with the new shadow cabinet ministers responsible for their industry, as they will now be open to ideas on policies for the election manifesto. 

This will help with getting ahead early, before they become cabinet ministers and are inundated with engagement requests. This Labour party is serious about business and the economy, so there is opportunity to build relationships and potentially influence policy.

What happens next?

Labour’s current position in the polls is likely to be further strengthened with the experienced communicators of Hilary Benn and Liz Kendall frequenting the airwaves, pushing Starmer’s case for a Labour government. This could provide another challenge for current PM Rishi Sunak, and the conservatives, amid current issues of inflation and the cost of living crisis alongside the recent RAAC schools crisis.

In regards to public service reform, we can expect more ideas to emerge from Labour before their manifesto is announced, especially in areas of health and education. Labour also recognises they will need to be economically restrained, so it would be wise not to expect big spending announcements.

Businesses should be prepared for a Labour government by coming up with policy offers that will deliver meaningful change without requiring new expenditure. Businesses should try to align with the five Labour missions: securing the highest sustained growth in the G7, making Britain a clean energy superpower, building an NHS for the future, making Britain’s streets safe, and breaking down barriers to opportunity.

Engage now to have a chance to shape the Labour manifesto. If you want to benefit from political intelligence and consulting services from Polis, contact us at hello@polisanalysis.com, and we can get you in touch with the team.