Labour MPs have indicated that Keir Starmer's leadership is secure at least until the May local elections, following a budget they describe as a 'tactical victory' but insufficient to revive the party's fortunes against Reform UK. More than a dozen previously loyal MPs told the Guardian they do not believe the budget will shift the fundamentals needed to beat Reform, with one minister stating, 'It only delays what is inevitable.'
After the budget, senior figures including Health Secretary Wes Streeting and the Prime Minister's chief of staff Morgan McSweeney were seen mingling with MPs, signalling a truce after a week of briefing against Streeting's leadership ambitions. A senior No 10 source dismissed suggestions Starmer would resign if the budget had been poorly received, calling the idea 'nonsense.'
MPs reported being 'love bombed' before the budget, with Chancellor Rachel Reeves meeting over 100 MPs individually and name-checking many in her speech. However, one MP noted, 'The budget doesn't change the fundamentals that they are one crap decision away from catastrophe.' Right-wing MPs expressed unease, with one calling the budget 'focused on the bond markets and the backbenches' rather than ordinary voters squeezed by welfare cuts and the two-child benefit cap.
A senior Labour figure described the budget as a 'tactical victory' but warned that 'political and economic trends are all still heading in the wrong direction.' They added, 'There simply isn’t a wider economic or political story that gives you any idea where we’re going or what this is for, beyond survival.'
Wes Streeting, who has denied leadership plotting, has been publicly defending soft-left figures like Lucy Powell and praising Angela Rayner, sparking rumours of a potential pact. One frontbencher suggested Streeting would seek votes from the left in any future contest, while the Home Secretary Shabana Mahmood could also be a candidate. Ed Miliband is considered unlikely to run, with allies saying he would prefer to be a 'kingmaker.'
Downing Street is already planning for the May local elections, which are expected to be disastrous for Labour. Discussions led by Spencer Livermore, Ed Miliband's 2015 campaign manager, are underway to limit damage. There are fears Labour could lose Wales to Reform UK and slip behind the SNP and Reform in Scotland. One senior Downing Street figure warned, 'If the budget is a dangerous moment, then the local elections are perilous.'
