Government is an exercise in persistence. Putting that into practise means dedicating oneself to shaking off setbacks, rather than getting bogged down in them, and in seeking opportunities in bad news where possible.
The resignation of Angela Rayner is such a moment. Sir Keir Starmer would never have chosen to lose such a prominent minister, or to do so in such embarrassing circumstances.
It’s happened, and there’s no point in Downing Street dwelling on the loss of one of their best-known and most driven frontbenchers, nor on the public anger about hypocrisy which will inevitably stick to the Government. Instead, they should look for any upsides her departure presents.
The first opportunity was in the reshuffle – either by letting go ministers who weren’t up to snuff, or taking the chance to bolster the top table. Done well, with a clear strategy and a message to land with the electorate, it offered hope of a reset.
Bluntly, that hasn’t happened. The main benefit reaped by the Prime Minister was the disruption of Nigel Farage’s big conference moment, but that’s about it. I doubt many voters this weekend read the newspaper and concluded a meaningful reboot was afoot in the corridors of power.
Having flunked that initial chance to make lemonade out of lemons, there remain other potential benefits that the Government could yet bank.
Chief among them is the opportunity to review the legislative agenda which Rayner was in charge of.
The Employment Rights Bill was her baby, and she defended its measures energetically against concerns about its economic impact put forward by colleagues from the Treasury, among others. Serious worries among employers were also effectively steamrolled by the political clout and determination of the former deputy prime minister.
The Government’s own impact assessment predicts a £5bn annual direct cost to business from the bill. That’s a sizeable cost to load onto a private sector are already struggling with increases to national insurance, a UK-wide productivity problem, and national and international economic uncertainty.
There’s good reason to believe that this assessment is overly positive, too. The report used assumptions about productivity growth and falling unemployment which have already proved to be too optimistic, and it concluded that the impact on unemployment would be “small or negligible”.
By contrast, actual employers – the people creating and protecting jobs, who will have to live with and adapt their decision-making to the impact of the bill if it becomes law – say otherwise. A survey of business leaders by the Institute of Directors (IoD) found that 49 per cent would be less likely to higher new employees, 52 per cent would be more likely to invest in automation, 36 per cent would be more likely to outsource jobs abroad, and 23 per cent would be more likely to make redundancies.
It’s worth noting that even in the Panglossian impact assessment, the authors were forced to concede that the workers at most risk of losing their jobs as a result of the bill would be low-paid, young and disabled. So while it seems likely they are underestimating the scale of that impact, we do at least know who would suffer from it the most.
Most pertinently for the Treasury, 72 per cent of the IoD’s members said that the bill would reduce economic growth. And the search for growth is meant to be the Government’s top priority.
I wrote for this newspaper a month ago that the downsides of the Employment Rights Bill were so large, so clear and so damaging to both the economy and the Government’s political mission that it should be ditched – but “while the country cannot afford the Employment Rights Bill, a troubled government with backbench problems cannot afford to anger Angela Rayner”.
As of last Friday, Rayner is no longer standing in the way, so Downing Street has a clear opportunity to reconsider her favourite item of legislation. The bill should follow Rayner out of the door.
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This is an extremely rare lever available to Rachel Reeves to give the economy – and business confidence – a concrete boost. The Office for Budget Responsibility might be persuaded to upgrade its economic forecasts in return, too, creating more fiscal headroom for the Chancellor with which she could limit other painful measures.
Given that the universal expectation, among the press and the public, is that the Budget will only bring pain – with the open questions being how much and where it will fall – the Treasury is not in a position to blithely pass up a chance to improve the numbers and cushion the blow.
Where before it faced opposition from a potential future prime minister with the wind in her sails, now it has a window of opportunity to act before it’s too late.
Labour MPs – and the party’s grassroots – wouldn’t like it, of course. But that’s all the more reason to be decisive and junk the whole thing, rather than risk getting bogged down by reopening, reviewing and renegotiating the specific measures it contains.
Shelve it pending better growth, kick it into the long grass under cover of the reshuffle, accidentally mis-file it on the wrong shelf, whatever – the Chancellor has an opportunity to improve the numbers which plague her every waking moment, and she should grasp it.
One of Angela Rayner’s great strengths was that she didn’t baulk at going after what she wanted, and never set out to ask for half-measures. Now she’s gone, Rachel Reeves’s best chance is to follow her example.
Mark Wallace is chief executive of Total Politics Group
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