Labour support in London hits all-time low

0:02Hi, I'm Charlie Duffield and welcome back to The Standard Podcast. If you're new here, hit follow and give us a rating. For all the latest news, head to standard.co.uk. Coming up later in the show. How will Londoners be affected by Chancellor Rachel Reeves' budget? But first, support for Labour in the capital is at a record low, according to a new poll, as Chancellor Rachel Reeves is set to clobber the capital with a wave of tax rises in her autumn budget. Following weeks of speculation, the Chancellor will deliver her budget later today. And we'll have all the analysis in tomorrow morning's episode, so stay tuned for that.

0:49In the meantime, here's a quick roundup of how the budget is expected to impact the capital. Rachel Reeves has said tax rises and spending cuts are both on the table, as well as potential limits to tax breaks on pensions. But it's the potential property tax shake-up that could impact London the most. Stamp duty might be replaced with an annual property tax. Stamp duty land tax is currently paid when purchasing any home above£125 ,000 in England and Northern Ireland. London, which has the highest average property prices in the UK, would see the greatest initial benefit from any reduction in stamp duty.

1:28However, it could also lead to a rise in house prices due to greater demand. But scrapping stamp duty would leave a gaping hole in the public finances. Indeed, 60 % of all stamp duty is paid by homebuyers in the south of England. The budget could also impact landlords. Rachel Reeves may introduce national insurance tax on rental profits and implement reforms to the private rented sector. It has been reported that Reeves will introduce a new tax on high-value homes. About 2.4 million properties across the council tax bands F, G and H could be affected, with the majority of those homes sitting in London and the South East.

2:09Small businesses are also fearful of what the budget may bring and how it will impact the hospitality industry in London. Previous hikes and national insurance contribution and a national minimum wage rise have impacted small cafes, restaurants, pubs and bars across the capital. The future of London is now in Rachel Reeves' hands. Reeves warned Labour MPs that they must stick together if they want to win the next general election, adding that they would like 90 to 95 percent of her spending plans, but would have to accept tough measures. But the Chancellor may face a challenge ahead, as Nigel Farage's reform has experienced a surge of support in the capital.

2:51London has for many years been a Labour stronghold, but the party's support has plunged since the general election last July. Antonia Jennings, chief executive of the Centre for London, said, The political make-up of London has shifted. This comes after decades of political parties ignoring Londoners' struggles and underappreciating the capital's role in the UK economy. She branded the narrative that London is a city paved with gold as false, stressing that one in four Londoners live in poverty after paying for housing. To find out more, I spoke to The Standard's political editor, Nick Cecil. Nick, tell us more about what this poll reveals.

3:35The Standard has got a new poll done by Cervantes UK for the Centre for London, and that shows that Labour is at a record low on just 32 % in London. So for many years, the capital has very much been a Labour stronghold. So certainly at the general election last July, Labour was at over 40 % in the polls. So it's come down 11 points since then. And the other very interesting thing in this poll is that there's been a surge by Nigel Swarger's Reform UK. So in June, reform was on 15%. And now this poll has found that reform is on 23%. So that's almost one in four voters in London. And not only are they gaining support amongst elderly people, the over 65s and the 55 to 65 age group, which in many ways you would expect, but they are also gaining support amongst younger Londoners.

4:32For example, reform is now on 23 % among the age group 18 to 24. And that's almost identical to the Greens who are on 22%. They're far ahead of the Lib Dems on 12%, but still behind Labour on 31%. So that's really interesting, because we're used to hearing about reform gaining popularity in other parts of the country. But this is perhaps the first time it seems that that's happening in the capital. Would you agree? Yes, well, certainly Chris Hopkins, who is the political research director at Savanta, he says that it looks like that Reform UK are a force in the capital for the first time ever. And so if this poll is reflected by future polls, because obviously this is just one poll and some polls have a margin of error of about 3 % or so.

5:19So if this is a new trend, then that very much reshapes politics in the capital. Now, we're still waiting on the details of Rachel Reeves' budget. We'll know more about that a bit later today. But do we know anything about how Londoners will be affected? The budget will benefit some Londoners and hit other Londoners with tax rises. So for example, we know that there's going to be some form of a mansion tax that is going to hit London hardest. There's going to be a freeze on the thresholds for paying income tax. And that will mean that hundreds of thousands of people in London and the South East are dragged into paying higher rates of income tax.

5:59But it's not all bad news for the capital. For example, the two-child cap limit is due to be lifted by the Chancellor, a controversial move, but that will benefit more than 260 ,000 children in London. What we're expecting is quite a Labour budget. So Miss Rees, the Chancellor, Rachel Rees, she was making very clear that there were hard choices ahead because of the state of the public finances. But she is going to raise around£20 billion worth in taxes. But she's also going to deliver some Labour measures like increasing the national living wage and also removing the two-child cap. So there'll be some Londoners who will welcome this budget, but there'll be many other Londoners who will think it's bad news.

6:46So why do you think Labour is losing support in the capital after being a stronghold for such a long time? I think there are multiple reasons for that. One is there's a general unhappiness with politics. There's still a cost of living crisis for many families in the capital. And this isn't just a British problem, an English problem. This is reflected on the continent and other countries. So that's one factor. I think Sir Keir Starmer is not a popular leader. Many voters have not been attracted to his leadership style. There's also been the rise of Reform UK. and also this poll may just be starting to pick up or we might see this in future polls.

7:25I think we're going to see a rise of the Greens under Zach Polanski. So I think Labour risks being squeezed and squeezed. I think to some extent the rise of reform in London is a protest vote but I think it's more than that. People want change. People are unhappy about their living standards. They're unhappy about other issues like the length of NHS waiting lists and also about immigration. Although I suspect that immigration in London is less of an issue than other parts of the country. Should Labour worry about the rise of reform in London specifically? Yes, Labour should be worried about the rise of reform.

7:56Having said all that, at the moment, we're not facing a general election. So people can have a free hit at Labour. They can say, I'm not going to vote Labour, and I'm really unhappy with them. But at a general election, people have to make a choice. So at the next general election, which we expect in 2029, at the moment, it looks like that voters will have to choose between a Labour leader, possibly Keir Starmer, or possibly even Wes Streety, or another senior Labour figure, or Nigel Farage. So that is a choice at the moment that the electorate are likely to face. The Conservatives are really struggling.

8:30At the moment, they're pretty much out of the picture. The Liberal Democrats do reasonably well, but you can't really expect Ed Davey to be in number 10 within four years or so. let's go to an ad break coming up why there could be danger ahead for next year's local elections in the capital we'll see you back here in just a moment

8:58welcome back so nick do you think rachel reeves is going to face some kind of backlash what does her political future look like at the moment Disquiet amongst Labour MPs and Labour supporters. So her first budget is widely seen to damage the economy. And this second budget has been marked by quite chaotic briefings ahead of it, including a speech by Miss Rees, where she very strongly signalled that she was going to break Labour's manifesto to raise income tax. And then she did a U-turn on that. So it has been an unprecedented tumultuous time before a budget. I've never known something like this.

9:36Given that it's been such an unstable run up to the budget, if it goes badly, then Ms. Reid will face a lot of criticism. The danger for her is that she is bringing in a whole array of smaller taxes and some of them could easily backfire. So it's a big gamble what she's doing and raising taxes heavily for a second budget in a row is deeply controversial. Why do you say it's controversial? Because she raised taxes last year, including imposing£20 billion of higher levies on businesses through higher national interest insurance contributions. And at the time, she said, I'm not coming back for more on anything like this scale.

10:18And we're not expecting this second budget to be such a tax raising budget. But even so, we're expecting about£20 billion of tax rises. So it's questionable whether she's sticking to her promise not to come back for more. And a lot is at stake in the budget, right? All budgets are very important. I think this budget is particularly important for Labour because it's a very difficult situation at the moment. And also it will set the scene for the rest of the Parliament. So she's got to make some tough decisions here. She's hoping that after the budget, things will calm down and that Labour MPs will fall in behind Keir Starmer and herself.

10:53That's far from clear that that will happen. There's already talk that West Streeting allies are plotting to try and oust Keir Starmer after the May elections. So in May, we've got local elections in London and other parts of the country, and those are expected to be very bad for Labour. There are a couple of reasons for that, certainly looking at London. If you look at the last time these elections were fought was back in 2022, and Labour did incredibly well then. They won Westminster, they won Barnett, they won Wandsworth, and this was beyond the expectations of Labour insiders. So it's a very high water mark for Labour to defend.

11:30Now they've fallen quite a lot in popularity since then. They're facing losing lots of seats in London and in other parts of the country. We're expecting some disquiet and unrest in Labour ranks after the May local elections. Why do you think Nigel Farage's reform is appealing to the electorate? London is hugely important for the UK economy. Some would say there's been an over-reliance on the capital to drive the UK economy and that other parts of the country haven't had proper investment in manufacturing and other industries, and that we rely too heavily on the City of London to basically bring in billions for public services.

12:06So yes, London is hugely important. Both the previous Tory government and as well as this Labour government have faced accusations of being anti-London because they are very concerned about people deserting Labour and people deserting the Tories to reform in other parts of the country in the so-called former Red wall. So very much the messaging of the Tory administrations and Keir Starmer's government has been directed at parts of the North and parts of the Midlands, often at the expense of London. How do you think reform is making such inroads in the capital then? Certainly, to start with, Nigel Farage is a very good communicator and Labour crying out for a communicator who could match him, as are the Conservatives.

12:50Reformers have also made loads and loads of pledges. And now they've done a U-turn on some of these pledges, for example, on their tax policy as they gain more support. Because if you are a minor party, you can pretty much say what you want, and people will listen and some will believe it. But if you've got more support in the country, then you come under greater scrutiny. So reform have done a new turn on some of their policies, including their key tax pledges. But what people, I think, see in reform is the prospect of change, that Labour is seen as continuing the same kind of centrist government as we had under the Tories.

13:25Reform is promising something quite dramatically different. What voters need to remember is that they were promises over Brexit and Brexit has not delivered promises that were made by Nigel Farage and Boris Johnson and other people. And even Mr Farage admits that Brexit has been a failure. A considerable proportion of voters appear willing to give Mr Farage a second go, even though he was the architect of Brexit and it has harmed the British economy. Finally, can you tell me anything else about the changing political makeup of London? Reform is gaining most of its support in outer London boroughs, but that's not to say that it's not gaining some support in more traditional inner London boroughs as well.

14:07So it's got people joining the party or saying they will vote for it across the capital, but it's very much on those outer boroughs where it is having the most success at the moment. The real danger, for example, for the Conservatives is that they get pushed even further out of the capital. At the last general election, they gained zero MPs in London. And that was the first time ever, literally no MPs in the city centre. Now, the Tories are under even more pressure from Reform UK.

14:41And that's The Standard. For all the latest news, head to standard.co.uk. if you'd like to get in touch please do drop us a line at podcasts at standard.co.uk we'll be back here tomorrow morning we'll see you then