No, Keir Starmer won’t be more radical in government – to the disappointment of some and the relief of others

The question that hangs over Labour’s conference in Liverpool is: ‘Is that it?’

Rachel Reeves, the shadow chancellor, has received unhelpful advice from both left and right. From the left, John McDonnell, her predecessor but one, says she will need a huge increase in public spending to “solve the crises in our public services and [raise] the capital investment needed to boost growth, fix our crumbling buildings and infrastructure and begin to address the housing crisis”.

From the right, George Osborne says she will need a huge increase in public spending for the same reasons. On his podcast with Ed Balls, another former shadow chancellor, Osborne said Reeves needs to be more explicit about this so that she has a “mandate” for tax rises, just as he had a mandate for welfare spending cuts when he came to office in 2010.

Reeves’s response to both of them is the same: Thanks, but no thanks. She and Keir Starmer are clear about the strategy. Labour’s election campaign is constructed out of iron discipline on the rock of fiscal responsibility. Tory spending plans are the baseline; no tax rises apart from VAT on school fees, abolition of non-dom status and the closure of loopholes.

Obviously, this is disappointing to McDonnell, who warns that, if Labour wins on this prospectus, “disillusionment will quickly set in, potentially laying the ground not just for the return of the Tories but the revival of the far right”.

What is more surprising is that Osborne, the author of “austerity” in the last decade, takes a similar view from what might be called the Institute for Fiscal Studies position – namely that taxes will have to rise, to pay for the things that people want, and that there is nothing else left to cut.

The big question, then, if there is a Labour government, is whether Starmer and Reeves will stick to their policy in office. It is the question that hangs over the party’s annual conference in Liverpool like an unseasonal heat haze: “Is that it?” Is Labour really promising just to be a more competent version of a Tory government? Are the only things we are allowed to promise those that involve no extra public spending (apart from proportional representation, obviously)?

It is a question that hangs over the long election campaign, because one of the Conservative attacks will be that Labour will say one thing to get elected and do another once it is in government. But it is also, as McDonnell says, a question for Labour in government because it will have some bearing on the election after next.

He argues that “maintaining a Labour government in office” requires big spending. I can reveal that Starmer and Reeves take a different view. Neither of them is a Blairite, but they might as well be. I think their essential political formation is the same as that of Ed Miliband, but their approach to winning elections is different. Miliband thought that if he had trusted his instincts more and been more ambitious about what the state can do, he could have won in 2015. He saw Jeremy Corbyn almost winning in 2017 as confirmation that he should have been bolder rather than as a narrow escape.

Starmer and Reeves think, on the contrary, that the way to win is to trust their instincts less and to subject themselves to the iron straitjacket of fiscal discipline. And because they think that before the election, my guess is that they will think that after the election too. If Labour wins, they will immediately start thinking about the next election. Whereas McDonnell argues that this requires them to spend, tax and borrow more, they will think that it requires them to continue to keep a tight lid on the public finances. So, no, there is no secret plan to say one thing to get elected and then to do another in government.

McDonnell is right that there will be many Labour supporters – and not just Corbynites – who will be disappointed by this. But he overlooks the effect of Labour simply being in power: a lot of people will be glad to see the back of the Tories, and relieved that Labour ministers are making decisions rather than Tory ones.

That is why Reeves will probably increase taxes a little – because she will have to, the public finances being in a terrible state. But she will do it by stealth, as Gordon Brown did, by “closing loopholes”. She will need to preserve the new government’s reputation for prudence. She doesn’t need a mandate; she needs to know what she can get away with.