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Week-in-Review: Winter fuel retreat signifies Labour’s lack of direction

by Justin Marsh
May 25, 2025
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“U-turns” are a much-maligned but essential manoeuvre. There comes a time in any administration, however adroit, when circumstance or strategic miscalculation conspires to place the government on the wrong side of public opinion. In this moment, pragmatic desperation prevails over a hitherto agreed, but now untenable, position. The government alleviates pressure by acquiescing to it.

Strategic retreats are a test of an administration’s character and statecraft. Ministers must resolve on the timing, setting and substance. Too soon, and critics will sense weakness and the possibility of further routs. Too late, and the government will appear stuttering and slow to adjust to the momentum of events. The chosen forum must be notable enough for a course correction to register; but not so conspicuous as to inspire a sense of panic.

The challenge is to survive with one’s credibility still intact. But the risks are manifest. Political history is littered with examples of governments doing considerable damage in some botched attempt to undo damage.

For critical commentators and opposition MPs, U-turns are the ultimate emblem of incompetence. To consciously upend one’s policy programme, to track towards a stance adopted by your critics, is to accept defeat. The credibility of the opposition rises in inverse proportion to the government’s own.

And yet the calculation is simple enough. For a perfectly rational cabinet operating in an ideal information environment, a U-turn occurs at the exact moment the cost of continuing along the current course outweighs the cost of reversing it.

In reality, that realisation is arrived at in stages. Epiphanies steadily fuse through the machinery of government until the prime minister, in time, is convinced. On-the-record interventions and private briefings ensure this tortuous process is played out across the media. The prime minister is often the last individual in Westminster to succumb to the inevitable.

***This content first appeared in Politics.co.uk’s Week-in-Review newsletter, sign up for free and never miss this article.***

That brings us to Keir Starmer and winter fuel. It is intrinsic to the nature of a U-turn that the government ends up adopting a stance it once dismissed as unfeasible. Speaking at PMQs on Wednesday, Starmer endorsed a position — in this instance the expansion of “eligibility” for the winter fuel allowance (WFA) — that his government had vehemently rejected for a total of 10 months.

Starmer is no stranger to advocating antithetical positions at different moments in time. But his winter fuel stance is sui generis. This was not a retreat from some abstract pledge voiced during a leadership contest, years before the reality of power dawned. Rather, the winter fuel cut was unveiled in July 2024 as no less than his government’s first major policy.

To be entirely accurate, it was Rachel Reeves who committed the government to means-testing the winter fuel payment, a lump sum of £200 or £300 paid to pensioner households to help pay heating bills. But she did so speaking for Starmer and, implicitly, legion Labour MPs.

In the rhetorical drum-roll that preceded the winter fuel pronouncement, Reeves highlighted the prevalent risk to “economic stability” and the unavoidable imperative to “make further in-year savings.”

She insisted: “This is not a decision I wanted to make, nor is it the one that I expected to make, but these are the necessary and urgent decisions that I must make.”

The choreography, not to mention the substance, was peculiar. Reeves did not need to include the WFA announcement in her end-of-term statement, months ahead of the autumn budget. And so Westminster concluded that the measure was a signal — to all of markets, Labour MPs and voters — that the government was prepared to take the tough decisions to right the public finances. 

Labour parliamentarians, still wide-eyed after their election victory, were introduced immediately to the realities of government. Accordance with the measure was a test loyal MPs, whatever their misgivings, needed to pass. 

Starmer had already thrown down the gauntlet. Just six days prior to Reeves’ statement, the Labour leadership withdrew the whip from seven MPs who, by way of an SNP amendment to the king’s speech, called on the government to scrap the two-child benefit cap. Reeves’ fiscal discipline and Starmer’s political ruthlessness sent an uncomplicated message. No 10 was prepared to face down spending demands. 

In other words, the Labour leadership marched the parliamentary party up a steep hill, under tacit threat of suspension, towards territory MPs neither wanted nor expected to occupy. Stationed there for 10 full months, Labour parliamentarians stood exposed to opposition fire, forced to sell the decision to concerned constituents. 

Starmer’s retreat on Wednesday risks crystallising an uneasy relationship between No 10 and the Parliamentary Labour Party (PLP). Those MPs who voiced reservations, including those around the cabinet table, will be less likely to follow No 10’s lead in future. Today, the government’s reserve of political capital stands diminished — thanks to a policy that was, by all measures, a modest saving in the grand scheme of government expenditure. 

The U-turn’s substance is also questionable. The new eligibility threshold for recipients of the winter fuel allowance has yet to be confirmed; Starmer has promised additional details at a future “fiscal event” — presumably the autumn budget. That means months of relentless and distracting speculation. Of course, it is perfectly possible — likely even — that Downing Street does not know at what point it will set the threshold to expand WFA eligibility, what mechanism it will use, or how it will pay for it. 

This debate will be enlivened further if Downing Street pursues the tactic teased on Wednesday. Starmer implied ministers will point to an improving economy to justify the expansion of WFA eligibility. “I made it clear in my earlier answer that as the economy improves we want to take measures that will impact on people’s lives”, Starmer told MPs.

The fact that the public finances have not improved markedly since July 2024 is set to be evidenced in the forthcoming spending review. Needless to say, the winter fuel retreat and the coming departmental spending cuts purvey contradictory signals. On Wednesday, the government cancelled a cut mere weeks before unveiling a host more. 

***This content first appeared in Politics.co.uk’s Week-in-Review newsletter, sign up for free and never miss this article.***

U-turns are notable not because they are humiliating, but because they reveal. They highlight a government’s anxieties, reflect a prime minister’s strength of standing and bring the interdependencies and relationships that drive our politics, especially within a governing party, into finer relief.

Starmer’s motivation for the U-turn did not reflect a change of heart — but a loss of nerve. Specifically, it was a response to an unholy alliance of focus group feedback, canvasser testimony, polling data and, above all, the verdict handed down by voters at the local elections. 

The WFA cut was a tactic: a fiscal measure to meet the Treasury’s rules, and a political signal to MPs, markets and voters. The act of U-turning is a tactic too, informed by a political calculation that the fiscal gain is no longer worth the political pain. 

The problem is that at no point across this debilitating saga is any kind of strategy discernible. At every stage, the direction was determined by circumstance — fiscal, electoral, political — and an evaluation of associated pros and cons. At best, Starmer participated in the defining saga of his premiership as a passive observer. The winter fuel cut was chosen by Reeves after perusing the options in the Treasury tray of revenue-raisers; the chancellor’s room for manoeuvre was itself restricted by her fiscal rules and tax pledges. Starmer U-turned on Wednesday because the backlash had become critical. He had no choice. 

We are presented with a paradox. The WFA retreat was possible because, as a tactic, it does not underpin any broader government programme. Starmer has jettisoned an unpopular policy and, the polling suggests, tracked towards public opinion. But the reason the government’s vision remains intact is because there is no ostensible vision. Rather, Starmer’s back-pedalling has revealed the vacuum at the heart of his government.

Now, a government that has shown itself to be drifting in the breeze of political opinion is liable to be buffeted again. The prime minister will come under further pressure from disquieted MPs in the coming months, over welfare policy for instance.

The second paradox of the saga is that, contrary to the label’s connotations, Starmer’s U-turn does not amount to a course correction. The prime minister is today faced with the same set of circumstances, political, economic and fiscal, that effected this ferment in the first place. In fact, the situation has worsened. 

This week began with a report, courtesy of the Telegraph, of conflict around the cabinet table between deputy prime minister Angela Rayner and Reeves. It ended with the suggestion, by way of a Bloomberg story, that No 10 chief of staff Morgan McSweeney is at odds with the prime minister over the two-child benefit cap. 

This is not surprising. When a government lacks direction, friction occurs everywhere. There is no fundamental idea providing the connective tissue between departments. 

A lack of direction, a lack of clear purpose, ultimately, is this government’s real “original sin”.

Josh Self is Editor of Politics.co.uk, follow him on Bluesky here.

Politics.co.uk is the UK’s leading digital-only political website. Subscribe to our daily newsletter for all the latest news and analysis.

The post Week-in-Review: Winter fuel retreat signifies Labour’s lack of direction appeared first on Politics.co.uk.



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