In this week’s issue of The Spectator – available at all good newsagents, or by getting a round in at The Two Chairman – Katy Balls writes about how Labour has “won back Britain’s millionaires”. It is a typically informative and effervescent piece from one of our leading political commentators. The central gist is that Keir Starmer’s party is doing very well at attracting rich donors.
“Two years ago,” she writes, “[Labour] had only one month’s wages left in its reserves”. Under Jeremy Corbyn, the Opposition had amassed endless legal fees and debts, and had relied primarily on small donations and the unions for their finances. When Starmer replaced his ex-bestie, the exodus of Corbynistas – and Boris Johnson’s apparent political primacy – had left Labour in dire straits.
Fast forward to today, and Starmer has been taking yet another lead from the Tony Blair playbook. Bolstered by their poll lead, various old New Labour hands have played in part in enabling the party to raise more money from private sources than at any point since 2008. Last year was the first where the party received more from businesses and private donors than the unions.
They are a mixture of disillusioned former Tory backers, returning Remainers and Blair enthusiasts – like long-time Labour supporter Lord Sainsbury – and a new kind of eccentric campaigner, epitomised by Dale Vince, chair of Forest Green Rovers and good friend of Just Stop Oil. Together, they have put the party’s finances on a firm footing.
One understands that party finance is not necessarily the sexiest of topics in the world. It also isn’t always the most important: Sainsbury donated £8 million to the Liberal Democrats in 2019, only to see them lose a seat. As Leave proved during the EU referendum, a strong campaign can overcome any funding disadvantage.
But it is still of interest, for three reasons. Firstly, to note just how close Labour seemingly came to getting into serious financial difficulty. Secondly, to see the direction of travel: that millionaires are flocking to Starmer with their wallets in two shows they consider a Labour government increasingly inevitable. And, most importantly, because these donations are not the unalloyed good they might seem.
Yes, it’s nice to be popular amongst some new rich friends. But their largesse is not only from the kindness of their soft left hearts. Once Starmer is in Number 10, they will be expecting something in return. For a few of the stauncher Remainers, that might mean leaning into closer ties with the EU – or “shadowing the Customs Union”, as one might put it.
Yet for some of these donors, their price will be much simpler: a peerage. Whilst Starmer is keen to imitate Blair’s success, one imagines the tribute act does not extend to repeating the Cash-for-Honours scandal. A man who has made so much of his own sanctimonious probity – a former Director of Public Prosecutions, no less – hardly wants to be found with his hand in the till.
The question of who donates to whom has become a much bigger political issue since Blair’s travails in the mid-2000s. The post-Brexit obsession with Russian money, Carol Vorderman’s newfound role as the face of the “who funds you??” brigade, the return of “Tory sleaze”: if getting close to the moneybags looked a little off then, it will only be more of a political headache now.
That’s even before Labour starts to indulge in any constitutional tinkering when in office. An elected House of Lords (or “Senate of the Nations and Regions”, or some other nonsense) suddenly provides far fewer opportunities for patronage. And that is even if this new class of Labour-friendly millionaires is willing to keep donating once the party is in power.
It’s very easy for a disgruntled ex-Tory to turn to Labour when the party is in Opposition and they have bets to hedge. But what happens when Starmer is in power? If he fails to make the compromises with the EU that they want, say, or is burdened by a similar set of scandals as his Tory predecessors, will Starmer’s new donors start to feel they have been had?
Most importantly, at what point will it dawn on those millionaires playing footsie with the socialists that a fundamental truth remains clear: Labour are not the party of business. They might currently be holding Alison Rose tight, but that is only because she has proven herself a fellow traveller in the inane world of HR w*kery. But that is very different from demonstrating a genuine conversion to capitalism.
The vast majority of British businesses are not NatWest. They are small and medium-sized enterprises interested in turning a profit and surviving a turbulent international period. They do not prioritise the art of appeasing the Gods of Equality, Diversity, and Inclusion, dolling our rainbow lanyards, and putting on Pride floats, like some of their larger and w*ker contemporaries. These are not the people to whom Starmer is speaking.
Labour’s support comes primarily from public sector workers, ethnic minorities, and young people concentrated in poorer urban areas. Starmer and Rachel Reeves may understand the need to distance themselves from Corbyn by waving the bloody shirt of fiscal probity. Yet whilst Rishi Sunak may strain against imposing higher taxes, it is something with which Labour will be eminently more comfortable.
More Equalities Acts, non-dom bashing, appeasing Gordon Brown and their own backbenchers: these will be Labour’s priorities, not making Britain more competitive. As Robert Colville has highlighted, despite Starmer’s warm words, he is not half as centrist as he might aim to suggest. Hence why – amidst the noise – the Tories have just received their largest donation in over 20 years.
Sooner or later those donors hoping Labour is the new party of business will discover Labour’s transformation is only skin deep – and quite literally pay the price.