Lessons for Labor from their British colleagues

British Labour leader Keir Starmer. Picture: AFP

Attending the British Labour Conference in Liverpool this week made for a refreshing difference to the experience of small-target politics being delivered by Albanese Labor back in Australia.

British Labour leader Keir Starmer may be facing a new Tory leader in Liz Truss and the election isn’t due for more than two years, but as the Conservatives announced one of the biggest personal income tax cuts in Britain since 1972 it took Labour just 48 hours to oppose the cut for the most well off.

What a difference from the Australian experience where Labor under Anthony Albanese and Jim Chalmers rolled over on stage three tax cuts. Some in Labor are doing a tortuous crab walk to try to wriggle out from delivering them, a move, if successful, that would be disastrous for Labor’s credibility, especially that of the Prime Minister.

The policy contrast, though, could not be more complete. Labor rolled over on tax cuts that benefit the wealthiest Australians in a deliberate embrace of small targetism and not wanting to be seen to stand for Morrison lite on tax and the economy. Whereas Starmer’s Labour used the announcement of the tax cut reversal to open its conference and frame the messages that the public will take from this week.

Labour in Britain is ahead in the polls. The adoption of the Albo small-target approach would’ve had them say nothing, stand for nothing. But instead Labour from opposition has staked the ground out on reintroducing a new top tax rate on the wealthiest Brits. It’s a good to see Labour can look after the budget, look after working families, and not simply capitulate to Tory tax cuts.

In addition to an oversubscribed business program for Starmer’s Labour, the conference delegates have a renewed optimism about its electoral chances. The party is in rude health after the leftist leadership of Jeremy Corbyn. I’ve attended the Corbyn era party conferences before. More like a rally of jealous socialists, they treated Corbyn as a cult-like figure while turning a blind eye to what was happening to Labour’s constituency post Brexit and to the scourge of anti-Semitism that flourished under him.

Australian politicians such as Albanese came to Corbyn for political counsel, no doubt swapping war stories of “fighting Tories”. Regular British conference attendees from Australian Labor also were back this week, ALP national secretary Paul Erickson espoused the “smart target” election strategy while the Australian advertising team touted for British campaign work.

There was also outgoing ALP president Wayne Swan on his wealth envy world tour. Though far more comfortable with the Corbynistas and their socialist agenda, he no doubt applauded the promise to tax the rich more. The irony is many of his Cbus super members stand to get a tax cut in stage three as well-paid construction workers who’ve benefited from union pay deals.

The direct comparison between Truss’s tax cuts for the wealthiest and Australia’s stage three tax cuts is clear. They both have enormously disproportionate benefits to the top 1 per cent and are paid for not by savings and cuts but by ever-larger tranches of government debt.

Some within Labor are positioning to flip on stage three cuts. They know they have the support of the Greens and independent David Pocock in the Senate. The language is all about “two years away, two budgets away” as they grapple with the sheer scale of the $215bn hit to the budget bottom line of these tax cuts that will have to start to be accounted for in this year’s forward estimates. But this was all well known when a small target was embraced and supporting stage three tax cuts was baked in. Albo will suffer irreparable harm to his personal standing if he reneges on his electoral compact on this tax promise.

Albanese wants to be seen as a new style of politician, one who keeps his word to the electorate. He’ll be in rare company, but his dedication to the small-target strategy that saw him unequivocally promise to keep the stage three tax cuts is commendable. Many may not like the stage three cuts, but this is the consequence of the small-target strategy and the price of a two-seat majority.

You can see the narrative his Treasurer is charting out though. The world has changed; that was then, this is now. He is briefing out the increased demands for funding on the National Disability Insurance Scheme, Medicare, aged care, that are all just natural budgetary increases made worse by inflation. These are not the new spends that Labor will have to provision for, or the new cost-of-living measures that will be demanded by a nervous backbench as the three-year term nears to a close. Chalmers will have Paul Keating “the recession we had to have” advice in one ear and Swan in the other decrying tax breaks for successful people.

That’s what makes the sliding-doors moment this week of British Labour all the more interesting. Swan and others are preaching the genius of a small-target campaign strategy while seeing a Labour opposition’s political courage, of a kind they could only dream of, on tax. And there’s so much more. Labour want to rebuild the National Health Service and drive a new green industrial revolution to deliver interventionist climate initiatives for a cleaner environment.

The benefit British Labour will have is seeing how the small-target election strategy delivers in government. They will be able to watch in real time whether you can govern in difficult times without an electoral mandate.

The more interesting lesson for Labor in Australia will be to see a Labour opposition in Britain with the courage and confidence to promise a full agenda for government and to provide real choice for voters rather than a timid, pale imitation of the previous Morrison government.

Cameron Milner is a director of GXO Strategies and a former Labor chief of staff.