A senior ally of Labour leader Sir Keir Starmer has cautioned that the government risks losing public support if the upcoming budget does not adequately address the rising cost of living. Darren Jones, who previously served as chief secretary to the prime minister, expressed concern over the financial outlook for many households as energy bills are set to increase by 16 percent to nearly £2,000 in January.
Chancellor John Healey is expected to announce a “temporary” and “targeted” support package aimed at assisting poorer households with their energy costs. The measures are anticipated to include an enhancement of the warm homes discount, raising the current £150 benefit for eligible households by an additional £100. This extension would assist around six million benefit claimants but would exclude those not receiving benefits, who are likely to face the full impact of price increases.
Jones urged the government to learn from past missteps, referencing the previous controversy over winter fuel payments. Early in Starmer’s administration, the government sought to scrap these payments for approximately ten million pensioners, but plans were reversed following significant public backlash. He emphasized the importance of setting appropriate support thresholds to help keep inflation in check by mitigating the rise in household bills.
Highlighting the challenges ahead, Jones pointed to factors such as higher energy costs, the potential effects of El Niño-related extreme weather, and inflation rates exceeding earlier projections for next year. He stressed that the budget must respond effectively to these pressures or risk undermining public confidence in the government’s economic stewardship, which he said will be crucial in determining Labour’s prospects in the next election.
Jones is also leading an initiative called Project Second Term, alongside former housing secretary Steve Reed and Labour MP Claire Hazelgrove. The group aims to support backbench Labour MPs through fundraising, resources, and regular analysis of economic polling to inform party strategy.
Recent polling by Public First showed that about 70 percent of respondents believe the country is becoming poorer, with 60 percent expressing pessimism about future economic prospects. Two in five said rising household bills could lead them to change their voting preferences, while only a quarter view Labour positively in terms of economic management or business credibility. Additionally, just one third of voters reported having a clear understanding of Labour’s economic plan, and seven in ten anticipate further increases in everyday expenses.
Reed underlined the importance of economic credibility for Labour’s future electoral success, calling for the prime minister and chancellor to translate their commitments to fiscal discipline into tangible policy actions. He stressed that as many voters face financial strain, the government must prioritise efforts to bring down the cost of living.