When Rachel Reeves stood up to deliver her Spring Statement, she did so beneath the banner of “stability, investment, and reform”. But the most consequential announcements, those with the sharpest, coldest edge, came buried in the detail. £4.8 billion will be cut from the welfare budget. The health element of Universal Credit, worth £390 a month, will be halved for new claimants deemed fit for work. The Office for Budget Responsibility estimates that, across this parliament, 3.2 million families will see their incomes fall by an average of £1,720 a year in real terms.
This is austerity, not just in its outcomes, but in its political logic. Reeves framed her statement around “fiscal rules”, market confidence, and the need to “fix the public finances”. But like George Osborne before her, she is choosing a particular way of doing so: not through taxing wealth or capital, but through disciplining the poor. For a Labour government to do this less than a year into office is significant. It marks not just a shift, but a confirmation: that the Labour Party, under Keir Starmer and Reeves, has completed its absorption into the economic orthodoxy of British capitalism.
The political class, across all parties, remains wedded to the idea that work is not only a means of subsistence, but the only valid measure of human worth. That idea runs deep in British political culture—Protestant in origin, Thatcherite in expression, New Labour in articulation, and now restated in Starmerism’s bureaucratic monotone. “We are the party of work,” Reeves said, as if that settled the matter. But for whom, and on what terms? In the same week, a government-commissioned review was launched into the so-called “sick note culture”, based on the assumption that too many people are feigning illness to avoid the labour market. The goal, ministers said, is to “change the sick note culture”, as though the rising tide of chronic illness, mental ill-health and disability is not the result of structural conditions—poverty, overwork, environmental stress—but a moral failing to be corrected with nudges and conditionality.
In a press briefing after the statement, journalists were told the Chancellor was “delighted” by the OBR’s forecast that 200,000 people would be “incentivised” into work by the changes to disability benefits. In another time, a Labour minister might have baulked at celebrating cuts to support for the sick and disabled. But this is a different Labour Party, one that sees the labour market, not the welfare state, as the site of salvation. It is a party that no longer speaks of dignity in any terms except the dignity of work. It cannot comprehend that human life might have value beyond wage labour, that art, care, study, parenthood, or rest might be worth defending in themselves.
At the same time, Reeves confirmed plans to increase defence spending by £6.4 billion by 2027. The extra funds will be paid for not by borrowing or taxation, but by further cuts, this time to Britain’s already diminished overseas aid budget. As ever, militarism and austerity walk hand in hand. And as always, the working class at home and abroad is made to pay.
There are alternatives. The IPPR has shown that a fairer tax regime, including a modest wealth tax, reform of capital gains, and equalising income from work and wealth, could raise tens of billions without touching a single benefit. But that is not the direction Reeves is taking. Her priority, she said, is to show that “Labour has changed”. The statement made clear what that change entails: a fiscal policy indistinguishable from the Conservatives’, wrapped in the language of technocratic necessity.
This is not a matter of electoral pragmatism. It is a matter of class politics. Austerity is not merely a tool of budgetary restraint; it is a weapon of class power. It disciplines labour, fragments solidarity, and protects capital. Reeves’s statement will, over time, deepen inequality, entrench poverty, and erode what remains of the post-war settlement. And it will do so with the legitimacy granted by Labour’s red rosette.
The great mistake of liberal commentary is to treat austerity as a policy error rather than a political strategy. But as Marx reminds us, the state is not neutral. It is the executive committee of the bourgeoisie. That Labour now wields its instruments should come as no surprise. The only question now is whether resistance can be rebuilt, not through moral outrage, but through political organisation.
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