If Keir Starmer is serious about boosting the economy, he should start with Chancellor Rachel Reeves. Since the election, nearly every policy she has introduced has hurt growth instead of helping it.
Starmer should apply his “growth rule” strictly to every decision in Reeves’s upcoming autumn Budget—because right now, it’s doing the opposite of what’s needed.
Reeves plans to raise £25 billion by increasing national insurance for employers, but this won’t help the economy—it will harm it. Deutsche Bank has already warned that this move could cost 100,000 jobs. December’s payroll figures showed a loss of 47,000 employees, the biggest drop since the pandemic, and that’s before the tax increase even starts in March. This policy fails Starmer’s own test for economic growth—it needs to be scrapped.
Another mistake is Reeves’s decision to tax wealthy non-doms on their global assets. Instead of staying in the UK and contributing to the economy, they’re leaving—taking their money, businesses, and jobs with them. Will this help the UK grow? No.
Yet, Starmer isn’t stepping in to stop it. He should also reverse the inheritance tax (IHT) changes that will hit family businesses the hardest. These businesses are key to a strong economy, creating wealth and jobs. But under the new tax rules, many will have to be sold when the founder passes away, likely ending up in the hands of US investors instead of remaining British-owned. That’s not good for growth.
The Office for Budget Responsibility (OBR) has confirmed that this Budget will do nothing to boost the economy. Despite Reeves spending £70 billion more each year, the UK’s expected growth rate hasn’t improved. In fact, the bigger government spending is expected to push businesses away, lower investment, and reduce living standards for the next five years.
If Starmer truly followed his own rule, he would scrap this Budget entirely. That would likely mean forcing Reeves to resign—a decision many in the UK might welcome.
Since she took office, economic growth has stalled. GDP grew by 1.1% in the first half of last year, but now, under Reeves, it’s set to shrink. The UK is heading toward a recession.
Reeves’s policies are killing growth, and Starmer should act now—but he won’t. That says everything about his so-called “growth rule.” It’s just another empty Labour promise.
