Across the country, families are still struggling with bills they cannot afford to pay. That was the reality in 2024 and it is the reason this government was elected. The surge in energy costs, made worse by Liz Truss’s mini budget, destroyed public confidence in the Conservative Party. Voters wanted relief from the cost-of-living crisis and the Labour Party promised to provide it.
It is important we keep this in mind today because the cost-of-living remains the primary measure by which our success will be judged. While many factors explain our collapse in the polls, the failure to bring household bills back towards pre-2021 levels explains why we have struggled to turn that around.
But governments are defined by how they act in a crisis. Keir Starmer has faced more than his fair share and the results have yet to convince the public. The war in Iran presents his latest test. The conflict already threatens another rise in living costs and has prompted calls to reverse the fuel tax rise and provide targeted emergency support. It also offers the Prime Minister his latest opportunity to make a clear guarantee that working-class communities will not face higher taxes and will instead see meaningfully lower energy bills.
The recent announcement of a targeted £53m support package is welcome, but it is nowhere near enough. If the war in Iran causes households to face a large increase in bills, it risks disaster for our party.
International crises require emergency solutions. This country has enough wealth to protect itself from economic shocks and there is a class of people who can afford to contribute far more to that effort. Yes, this is yet another call to tax the rich, but the scale of wealth inequality in the UK leaves no serious alternative.
The government can win consent for wealth taxes but the detail matters; we need to be clear about where those contributions should come from and that they will be used to ensure the poorest households do not bear the cost of Donald Trump’s war.
Starmer and Reeves made a shrewd political move when they previously framed tax rises on landlords and market speculators as a correction to unearned wealth. Distinguishing between income from work and wealth derived from assets resonates with people because it reflects a lived sense of fairness. We can build on that.
Landlords, property investors, and stockbrokers continue to contribute far less than they should. Targeted levies on their wealth could help absorb market shocks while protecting the incomes of working households. Alongside this, temporary rent controls could also ensure that any levy placed on a landlord is not simply transferred onto tenants in the form of higher rents.
We should also look seriously at where large sums of money are already flowing. One example sits in plain view every weekend; Premier League football has seen two decades of rapidly inflated transfer fees, and enormous sums circulate through clubs located in some of our poorest cities. A modest levy on player transfers over £10 million could capture a small share of that wealth and return it to the communities that sustain the sport. Proceeds could be channelled directly to the local councils under intense financial pressure while still being expected to support communities with rising living costs.
None of this will matter if the government does not treat affordability as its central priority. But with the exception of Ed Miliband, government delivery does not feel like it is working to address the cost-of-living, and there is little sense of urgency or shared direction. It has also been a long time since anyone referenced the missions of our so-called mission-oriented government, and a sense of drift has set in.
If Keir is serious about turning this around, he needs to act like it. That means making a clear, systematic commitment to lowering the cost of living across the entirety of government, not one priority among many.
One practical step could be appointing an independent Cost of Living Tsar with the authority to co-ordinate and set measurable targets across departments. DEFRA could be made to regularly report on progress in cutting water bills. MHCLG could be set ambitious goals to lower rents and increase affordable housing. DESNZ could accelerate the retrofitting of homes to bring down energy bills permanently. Someone with public credibility would give this challenge the urgency it requires. Martin Lewis would be an obvious choice – and it may take someone from outside of Westminster to bring the focus that is currently missing.
If we are to salvage this government, we must deliver the change people voted for. They did not vote for managed decline, but change they could feel in their everyday lives. That means radically cutting household bills and showing that the can economy work for working people. It will require confronting wealth and power directly. But if we don’t, we will face the alternative of choosing to watch the living costs keep rising and public patience quickly run out.
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Minesh Parekh is the Labour & Co-operative Councillor for Crookes & Crosspool on Sheffield City Council.
All blog posts represent the views of the author alone and not necessarily those of Mainstream.
