Thom Jackson-Wood🧑🏻‍🦽🇪🇺🇬🇧 🇺🇦

The underlying discontent among rebellious and even loyal Labour MPs stems from what many would say is a pathetically late discovery: that what’s driving so much government policy is Rachel Reeves’s fiscal rules and the absolute power of the Office for Budget Responsibility in determining whether she is breaching those rules or not. Any illusion that this isn’t the single most important driver of government decision-making was shattered today by the revealed contradiction between its establishment of a supposedly fundamental review led by disabilities minister Stephen Timms to shape new criteria for awarding Personal Independence Payments, while nonetheless sticking with the contradictory stipulation that from November next year no one will be eligible for PIP if they don’t score four points on one of PIP’s existing criteria. It is absurd and illogical to characterise Timms’s review as the face of humane reform while simultaneously saying that this new four-point rule based on existing criteria will willy-nilly come into effect next year. So what’s really going on? The work and pensions secretary’s unspoken reason for sticking to the four-point reform is that without it, and under the OBR-assessed fiscal rules, Reeves would have to fill a £5bn hole in her finances in the autumn’s budget, and not the £2.5bn hole created by Kendall’s partial welfare-reform climb down. That is a big difference when it comes to any taxes Reeves may have to raise or any spending she may have to cut. So a growing number of Labour MPs see this subservience to the OBR and the fiscal rules as just the stupidest motivation for making today’s decisions that affect the lives of the most fragile of UK citizens - decisions that will, on the government’s own calculations, shift 150,000 vulnerable people into poverty. These MPs were bitten once by the OBR dog when Reeves chose to means-test the winter fuel allowance as proof of her fealty to the OBR’s jurisdiction over her own fiscal rules. With the disability reforms, many of them now feel twice shy. They don’t ask why a Labour government respects the OBR, especially after the Truss/Kwarteng fiscal debacle caused by their disrespect for the OBR. But they do question why the Chancellor and Treasury endow the OBR with an almost mystical ability to determine which policies are sensible and why Reeves has seemingly abdicated responsibility for trying to sell the government’s initiatives to the country’s creditors independently of the OBR and fiscal rules straitjacket. So whatever the outcome of the vote tomorrow on the welfare reforms, Reeves and Starmer are now under enormous pressure - probably irresistible pressure - to lose their OBR religion.