Five things the IfG learned at the 2025 Labour Party Conference

Starmer and Labour wanted to talk about Reform and reform

Tim Durrant

The prime minister’s speech echoed the key themes of conference as a whole: the importance both of taking the fight to Reform UK and of driving reform of public services. Starmer tallied up what he sees as the successes of Labour’s first full year and created some narrative space for his cabinet colleagues to push back against Nigel Farage.  

There were a few policy announcements – on immigration, on student grants – but much was left to the budget in November. 

More immediately, the question is whether Starmer’s new rhetoric signals any real change in how Labour governs and its ability to deliver tangible change. The prime minister’s many recently reshuffled ministers got through their first conference with their new briefs but will still be getting to grips with their new departments.

Crucial among Starmer’s new appointments was that of Darren Jones, the new chief secretary to the prime minister and chief minister in the Cabinet Office. His is the role with the greatest capacity to make changes to the rhythm and structure of how government operates, and potentially to its capability to turn Starmer’s rhetoric into reality.

Starmer shifted the government’s narrative from five missions to one

Alex Thomas

Keir Starmer’s conference speech in Liverpool signalled another evolution of the government’s priority-setting. The prime minister said that “the defining mission of this government is to grow the economy” to improve living standards and take on Nigel Farage’s Reform party. While the five original mission themes did feature in the rest of the speech, and around the conference fringe ministers were promoting the government’s work on climate change, education and training, the NHS and safer streets, economic growth was front and centre.

Ministers, including Chris Ward – newly promoted into the Cabinet Office – at an IfG fringe – acknowledged that the government had not yet found its gear in “rewiring the state”. While a learning curve is inevitable, 15 months is a long time for an incoming government to get going. Governments of all stripes need to get better at preparing for and managing the transition to power. That includes sorting out the operation of government at the centre. There was optimism in Liverpool that the new Cabinet Office team of loyal Starmerites, headed by Darren Jones, would be a close-knit and cohesive group, but also questions about whether Jones would end up being stretched too thinly to really focus on his No.10 job.

Time is running out for Rachel Reeves to set out a narrative on tax

Gemma Tetlow

One crucial part of the backdrop to this Labour Party Conference was the widespread expectation that the economic and fiscal forecasts for the UK will look worse at the budget on 26 November than they did in March, requiring chancellor Rachel Reeves to announce new tax rises to stay on track to meet her fiscal rules. It was not surprising that ministers steered clear of committing to any significant giveaways in their conference speeches, but there was also no serious suggestion that deviating from those rules was an option.

Nonetheless, there was a lot of speculation about whether the government is about to abolish the two-child limit on means-tested benefits in its forthcoming child poverty strategy. At a fringe event, education secretary and deputy leadership hopeful Bridget Philipson said this was “definitely on the table”. ¹⁰ https://www.the-independent.com/news/uk/politics/two-child-benefit-cap-bridget-phillipson-labour-b2836482.html  Doing this would make the fiscal challenge in the budget even harder – to the tune of around £3½bn. ¹¹ https://ifs.org.uk/articles/two-child-limit-poverty-incentives-and-cost  

But while tax was discussed at several fringe events, with backbench MPs, Labour members and others airing a range of ideas for overhauling the UK tax system – including the idea of ditching the manifesto pledge not to raise income tax, NICs or VAT, ministers did not put forward a vision for Labour’s approach to tax. All Reeves said in her speech was that “our economic renewal will rest on stability, to keep taxes…as low as possible”. ¹² https://labourlist.org/2025/09/labour-conference-uk-chancellor-rachel-reeves-conference-speech/  Time is running out for the Treasury to sell to the public a coherent narrative on tax before the budget to underpin any measures they do announce.

Business waits for the budget before delivering its government verdict on 

Giles Wilkes

With the budget looming large over the Labour conference, Rachel Reeves faced two big questions. The first was whether party discipline around fiscal orthodoxy would hold – or be eroded by siren voices calling for bond market worries to be brushed off. But no serious figures argued that the limits the chancellor is working to are somehow optional, and the conference showcased a growing recognition of fiscal orthodoxy as a potent weapon against the government’s antagonists on both the radical right and restive left. There was even some thoughtful muttering in the fringes about how voters should be confronted with the need for taxes to rise, including those the party promised not to touch, rather than denial of the need for it.  

The second question was whether business had been mollified after the loss of trust that followed the tax rises of last year. The answer is less straightforward, and not just because everything hangs on the decisions made later in the autumn, on business taxes in particular. The government has published promising strategies for business in the past year, and now it is being told everywhere that all hinges on delivery – and businesspeople understand better than anyone that you don’t congratulate anyone on delivery until the thing is actually done. Moreover, beyond fiscal policy, corporate Britain wants evidence that the government is willing to take their side on key policy questions: around energy costs, labour regulation, the pricing of drugs and more. Warm words are nice – conference was pleasingly unmarred by populist digs at the business world – but everyone is waiting for concrete action before delivering a firm verdict.

Labour doubles down on its energy plans but needs to keep consumers on board

Jill Rutter

Ed Miliband and his team were on punchy form at the conference on the progress they are making on clean energy. Miliband accused Reform of breaking the climate consensus by importing culture wars from the US and emphasised what abandoning renewables would mean for the jobs clean power will create.  

His No.2, Michael Shanks, at our event with Energy UK and SSE, boasted that DESNZ was the department that was really driving forward its mission (“sorry, Wes”) – and we would agree. The government is making significant progress in identifying projects to fill the pipeline to deliver the clean power goal by 2030 and is grappling with the difficult task of unblocking the grid. Faster? Yes. Fast enough? That is not so clear.  

Other questions remain. On the demand side, the government has committed to a big expansion of data centres to meet its AI ambitions. The government will face a challenge in making sure that it puts conditions on those data centres to ensure they fit with its wider energy objectives. It also needs to deliver quickly on its promise in the modern industrial strategy to reduce industrial electricity prices where statistics show the UK in an unenviable top position.  

And as net zero becomes more contested politically, the government will need to keep consumers on board. Labour promised lower bills alongside clean power, and it has a range of initiatives to help the fuel poor – with pensioners set to see their winter fuel payments restored. In the long run, home-grown clean power will remove dependence on volatile internationally traded gas. But that falls short of making energy more affordable for everyone by 2029. That may depend on the chancellor giving a helping hand.