Starmer Turns on Reeves as Labour Faces Budget Meltdown with Fresh Tax Storm Ahead

Rachel Reeves has managed to land herself in hot water at the Treasury, and the fallout is giving Keir Starmer a serious headache. During the election campaign, Starmer had been full of praise for his Chancellor, but that admiration has now faded fast.

Reeves came into office promising competence, but after 14 months the numbers look bleak. She inherited what she claimed was a £22 billion black hole from the Conservatives, and somehow doubled it to more than £40 billion in record time, reported the Express.

Starmer has been forced to step in repeatedly. He reversed Reeves’s unpopular decision to cut the Winter Fuel Payment after a public backlash, and U-turns followed on benefit cuts after Labour MPs pushed back. The sense of chaos has left the Prime Minister scrambling to keep control while the economy stumbles and government finances spiral.

The upcoming Budget looks set to be brutal. Reeves is reportedly planning tax rises of between £20 and £40 billion. But Starmer is no longer leaving her to it. He has taken the unusual step of bringing in a minder to keep her in check, a clear sign of his waning confidence.

The new figure is Baroness Minouche Shafik, a former deputy governor of the Bank of England, now billed as Starmer’s chief economic adviser. She is being sold as a heavyweight economist, though her record has raised eyebrows.

Shafik’s career includes stints at the IMF, the LSE, and most recently as president of Columbia University, where she resigned after losing control of campus protests. Critics say she represents the familiar pattern of “failing upwards,” but her arrival suggests Starmer doesn’t trust Reeves to manage the Budget on her own.

Shafik’s past work has also fuelled fears about what’s coming. She co-authored a Resolution Foundation report with Labour’s pensions minister Torsten Bell that called for higher taxes on homes, shares, and dividends. For voters already bracing themselves for a squeeze, this is hardly reassuring.

The shake-up doesn’t stop there. Darren Jones, once Reeves’s deputy at the Treasury, has been moved into Downing Street as Starmer’s new chief secretary. That means Reeves has lost not just her adviser but also another layer of influence over policy.

Jones is not without controversy either. Earlier this year, he had to apologise for describing cuts to disability benefits as being like taking away pocket money from a child.

He was also criticised on BBC Question Time for claiming most migrants arriving across the Channel were women and children, when official figures show three-quarters are young men. He was also linked to the disastrous attempt to scrap the Winter Fuel Payment.

As if that wasn’t enough, one of Starmer’s senior spin doctors has resigned, adding to the sense of turmoil inside Labour’s top team. For a party already struggling with public confidence, the timing could not be worse.

Despite the reshuffle, the core message doesn’t seem to be changing. Reeves, Shafik, and Jones all share the same outlook, and the answer to every fiscal challenge appears to be more tax. For Starmer, who promised stability and competence, it is beginning to look like the same old story dressed up in new faces.