Rachel Reeves pitches herself as Labour’s version of Thatcher as she vows ‘decade of national renewal’

The shadow chancellor will vow to ‘reject managed decline’ in a key pre-election message to the business and economic community

Archie Mitchell
Tuesday 19 March 2024 13:47 GMT
Rachel Reeves says Labour will 'rebuild' Britain's economy after 'wreckage of Tory misrule'

Rachel Reeves will pitch herself as a modern day Margaret Thatcher, likening the challenges facing the UK to those faced by the Iron Lady in the late 1970s.

The shadow chancellor will say Britain stands at a similar “inflection point”, promising to write a “new chapter in Britain’s economic history”.

Repeating Labour’s pledge to embark on “a decade of national renewal”, Ms Reeves will echo Lady Thatcher in promising radical reforms to end the country’s “managed decline” and restore “strong economic growth across Britain”.

At a major speech on Tuesday, Ms Reeves will say: “When we speak of a decade of national renewal, that is what we mean.

“As we did at the end of the 1970s, we stand at an inflection point, and as in earlier decades, the solution lies in wide-ranging supply-side reform to drive investment, remove the blockages constraining our productive capacity, and fashion a new economic settlement, drawing on evolutions in economic thought.”

Shadow chancellor Rachel Reeves will outline Labour’s plans to drive economic growth on Tuesday (Victoria Jones/PA)
Shadow chancellor Rachel Reeves will outline Labour’s plans to drive economic growth on Tuesday (Victoria Jones/PA) (PA Wire)

Thatcher was associated with extensive supply-side reforms - effectively policy decisions which seek to make particular markets and industries more efficient - including privatisation and deregulation.

Left-wingers criticised Ms Reeves over the comparison, with the Momentum campaign group saying the Labour leadership was “once again proving itself out of touch”.

“Thatcher’s Government did not bring about ‘national renewal’ but instead misery for millions of working-class people and ballooning inequality,” Momentum added.

Richard Leonard MSP, the former Scottish Labour party leader, said: “In the 1980s manufacturing was butchered, factory after factory closed, privatisation was let rip, unemployment rocketed, profits boomed, the wage share fell, the rich got richer, and inequality soared. No rewriting of history. Thatcher didn’t renew the economy, she broke it.”

Labour leader Sir Keir Starmer faced a similar backlash for claiming Lady Thatcher effected “meaningful change” and “set loose Britain’s natural entrepreneurialism”.

But, delivering the annual Mais lecture on Tuesday night, Ms Reeves will promise Labour is to take a different path to the Iron Lady, adding that growth must be “broad-based, inclusive, and resilient”.

Margaret Thatcher oversaw the deregulation of UK financial markets
Margaret Thatcher oversaw the deregulation of UK financial markets (Corbis via Getty Images)

She will say: “And unlike the 1980s, growth in the years to come must be broad-based, inclusive, and resilient.

“Growth achieved through stability – built on the strength of our institutions. Investment – through partnership between active government and enterprising business. And reform – of our planning system, our public services, our labour market, and our democracy.”

Ms Reeves will add: “In the face of a more unstable world, the task is not only to recognise the acute risks but also to identify the opportunities.

“To reject managed decline and pursue the long overdue task of renewing our common purpose, rethinking outmoded assumptions, and rebuilding growth on strong and secure foundations.”

In a key pre-election message to leaders from the world of business and finance, Ms Reeves will vow to “reject managed decline” and stress Labour’s “optimism” about the challenges Britain faces. Previous speakers have included Sir Tony Blair in 1995, before he entered Downing Street, and former chancellor George Osborne in 2010.

I remain an optimist about our ability to rise to the challenges we face

Rachel Reeves, shadow chancellor

Ms Reeves, a former Bank of England economist, will also propose reforms to the Treasury that will increase the role of the department’s Enterprise and Growth unit.

“I remain an optimist about our ability to rise to the challenges we face,” the Shadow Chancellor will say.

“If we can bring together public and private sectors, in a national mission – directed at restoring strong economic growth across Britain.

Ms Reeves claims Labour will also plan to create half a million jobs across the UK through a new National Wealth Fund, to invest in growing industries.

Nevertheless, the ambitious pledges come a week after the shadow chancellor stressed that “we’re not going to be able to turn things around straight away” if voted into power in the election, expected to take place in the latter half of 2024.

On Tuesday, she will say that the Treasury must be ready to “get to work from day one” to improve economic growth.

This will include Treasury reform by bolstering the Enterprise and Growth unit set up by the last Labour Government, to integrate it into the budget and spending review processes.

She is expected to say: “We have found ourselves in a moment of political turbulence and recurrent crises with the burden falling on the shoulders of working people.

“With at its root, a failure to deliver the supply side reform needed to equip Britain to compete in a fast changing world.

“I suggest that the answer today is an economic approach which recognises how our world has changed.

“Building growth on strong and secure foundations, with active government guided by three imperatives: guaranteeing stability, stimulating investment through partnership with business, and reform to unlock the contribution of working people and the untapped potential throughout our economy.”

The shadow chancellor will add that the Treasury must be ready to “get to work from day one” if Labour comes to power this year.

But chief secretary to the Treasury Laura Trott said: “Rachel Reeves may be promising a ‘new chapter’, but it will be the same old Labour. No plan – just more borrowing and more taxes – exactly how the last Labour government wrecked our economy.

“Only Rishi Sunak and the Conservatives have a plan that will deliver a stronger economy for the long term and a brighter future for our children.”

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