The Tories and Reform take the economic fight to Labour

Britain’s major right-wing parties today took the fight to Labour – and each other – over the economy. Kemi Badenoch and Robert Jenrick flexed their fiscal muscles as they vowed to take Andy Burnham to task over excessive spending and an ‘addiction’ to welfare.

On the first day of Reform’s conference, the party’s Treasury spokesperson told business leaders that, as Chancellor, he would reduce spending by £80 billion a year by the end of the next parliament. He also announced that he had written to major holders of UK government debt, including banks and pension funds, inviting them to attend a ‘roadshow’ and ‘private round tables’ in London and New York, where he will set out his approach to borrowing. While Reform is renowned for its campaigning on migration, it has often been criticised for paying too little attention to the economy. Jenrick is determined to change that.

While there is clear blue water between his economic vision and Burnham’s, the former Tory minister is also keen to distinguish Reform from his old party. He spent the day pitching Reform as ‘the party of fiscal credibility’ and warning that both ‘the Tories and Labour have lost the trust of businesses and investors’.

But Jenrick now has something in common with Burnham. Like the Prime Minister, he will attack the Conservatives over Liz Truss and, in particular, the ‘moron premium’ imposed by the mini-Budget. At conference, Jenrick said:

You have to learn the lessons from what happened with Liz Truss and the mini-Budget where you just basically went into a sweetie shop and took everything off the shelves and stuck it into a Budget. And quite rightly the markets reacted very negatively to that.

Addressing business chiefs, Jenrick promised to return UK borrowing costs to French and Italian levels, saving £30 billion a year in interest payments. A Reform source told The Spectator:

The Tories started the borrowing crisis and Labour have only made it worse. While Kemi faffed around with fake policy commissions, Reform have set out a detailed plan for £80 billion of savings that will allow us to put the economy on solid footing.

Meanwhile, Badenoch spent the morning warning that the country was heading for bankruptcy under Burnham. The Tory leader pointed to the endless spending demands from Labour MPs and described the Prime Minister as a man who ‘doesn’t know how to say no’. She argued:

They will run out of money. The problem with socialism is they always run out of other people’s money, not their own.

The Conservative leader also set out her plan to raise defence spending to 3 per cent of GDP by taking the axe to welfare. She batted away suggestions that reducing the benefits bill would punish Britons who work but earn low wages, arguing that those who choose not to work without adequate reason have the most to fear.

In the build-up to the Budget, it is clear that the right is ready and raring to attack Labour’s tax-and-spend ambitions as the Treasury coffers run dry. But when it comes to fiscal credibility, both parties have plenty of work to do.

For the Conservatives, that means reckoning with a less-than-stellar economic record in government, while persuading the public that their new-look Treasury team has the expertise and discipline to deliver what the party is promising: lower taxes, lower spending and growth.

Reform, meanwhile, faces an uphill battle to prove that its plans amount to more than back-of-a-fag-packet calculations. Economists have consistently argued that the sums behind many of its major policies do not quite add up. At Reform’s conference and in the months ahead, Jenrick will have to prove otherwise.