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Sir Keir Starmer is braced for a clash with unions as his insistence on removing winter fuel payments from 10 million pensioners sparks a significant rebellion among Labour MPs.
With the prime minister expected to address the Trades Union Congress (TUC) in Brighton, its president has warned that a second wave of austerity will boost the rise of the far right in Britain’s left-behind communities and bolster Nigel Farage’s push for power.
Matt Wrack, the Fire Brigades Union general secretary and current president of the TUC, has warned Sir Keir that his mandate for power is based on a collapse in support for the Tories “not love for Labour”.
“People are in despair, and that’s how [far-right] elements have won support here in the UK and elsewhere in Europe,” he warned.
Mr Wrack admitted union activists arrive at the annual conference “feeling much more positive” about the prospects for their members since Labour’s massive election victory in July. But serious differences remain over economic policy with fears that Sir Keir and his chancellor Rachel Reeves are heralding a new age of austerity similar to George Osborne after the banking collapse.
Sir Keir and Ms Reeves insist the cancellation of winter fuel payments for millions of pensioners is necessary to fix a £22bn black hole in Britain’s finances.
The pair have refused to back down even though health secretary Wes Streeting has expressed his disquiet. And an early day motion put forward by new Labour MP Neil Duncan-Jordan opposing the measure has now been signed by36 MPs, including six suspended Labour MPs and 18 current Labour members.
There is anger that the government has refused to publish an impact assessment on the winter fuel payment cuts before MPs vote on the issue in parliament. A written answer to former Labour shadow chancellor John McDonnell said it would be “published in due course”.
While Ms Reeves says it will save the Treasury £1.5bn a year, research carried out by Labour in 2017 – when the Tories proposed means-testing winter fuel payments – suggested the move would kill 4,000 pensioners.
The chancellor confronted angry MPs at a meeting of the parliamentary Labour Party on Monday night, telling them: “There are more difficult decisions to come. I don’t say that because I relish it. I don’t, but it is a reflection of the inheritance that we face.
“When members are looking at where to apportion blame, when pensioners are looking where to apportion blame, I tell you where the blame lies. It lies with the Conservatives and the reckless decisions that they made.”
One person in the room said it was packed with figures on the Labour government payroll as an explanation for the lack of strong opposition to the policy.
The peer told The Independent: “The real problems are going to come when the coffins start coming in.” They added that a concern about the policy is that every pensioner who dies as a result of the cold this winter will now be blamed on the chancellor’s decision.
Speaking exclusively to The Independent, Mr Wrack made it clear he shared the MPs’ anger and warned against using the “black hole” as a pretext for a spending cuts agenda.
“I think there have been some slightly worrying statements,” he said. “The Labour manifesto says there will be no return to austerity, and unions will be insisting on that. We’ve been told to tighten our belts for far too long, and I don’t think people are willing to take any more of that.”
Mr Wrack has become frustrated with the debate centered on Labour “making a choice” for above-inflation wage rises for doctors and train drivers as well as other parts of the public sector with the removal of winter fuel allowance for pensioners and the refusal to end the two-child benefit cap.
“We don’t support the cuts in the winter fuel allowance, we support measures to tackle poverty, including lifting the two child limits and so on. So we do have disagreements with some aspects of the government’s policy and approach to this, and we don’t see a contradiction between those and raising wages for working for workers as well.”
Addressing the rise of right-wing politics in the UK, including Nigel Farage’s Reform UK in the general election with almost 15 per cent of the vote and the far-right riots over the summer, Mr Wrack warned that there was a “wake-up call” for unions and Labour.
“There’s a big wake-up call for the Labour government here,” he said. “Many of these areas where we saw those riots are in traditional Labour areas that have been neglected for decades, where, you know, there’s almost seen to be a Labour establishment, as some people would see it.
“We need something different. We need a change. And I think the challenge for the new government is to actually offer something that’s going to make real differences to people’s lives.”
Mr Wrack was as shocked as many when he saw scenes of far-right protesters attempting to set fire to hotels containing asylum seekers and he has linked it with the increase of popularity of Reform at the ballot box and right-wing parties in Europe such as Alternative For Germany, which had strong election results last week.
The veteran union leader accepts unions have a role in countering the message of despair that the far right and populist parties feed on.
“I think that in terms of Reform that the trade union movement needs to take it seriously to win millions of votes cannot be dismissed, and we have to have our answers to that.
“While racism and far-right ideas have a role that have played a part in that also there is the complete lack of hope in many parts of society and in many communities with deindustrialisation and the lack of jobs, decent homes, and public services.
“People are in despair, and that’s how these elements have won support here in the UK and elsewhere in Europe.”
His warning to Sir Keir’s government is that it cannot take voters for granted.
“I don’t think they can take the trade unions for granted, and they certainly can’t take the voters for granted. My interpretation of the election is largely a collapse for the Tories, rather than anything else.
“Part of the collapse of the Tories was the rise in the Reform votes that lost them more seats, and not a huge endorsement of Labour. So if Labour wants to get another term in the next general election, it has to tackle the underlying causes of how the far right and how Reform has grown.”
A Department for Work and Pensions spokesperson said: “We are absolutely committed to supporting pensioners through the triple lock which means that over 12 million pensioners will see their state pensions increase by almost a thousand pounds over the next five years.
“But given the dire state of the public finances we have inherited, it’s right that we target support to those who need it most. Over a million pensioners will continue to receive the winter fuel payment, while many others will also benefit from the £150 warm home discount from October to help with their energy bills over winter.”
