Voices: ‘Taxes will go up under Labour’ is the only way the Conservatives can fight back

Norman Fowler is more of a lesser-sung public servant than an unsung hero. He was the health secretary who persuaded Margaret Thatcher to run a campaign to educate people about Aids.

He was a moderate and sensible Conservative party chair under John Major who tried to keep the party on the centre ground. And until two years ago he was a reforming lord speaker who presided over the upper house of parliament.

There ought to be more of him: decent ministers who did good work (he also made seat belts compulsory as transport secretary) and kept well-written and honest diaries. Fowler’s diaries for the period 1980 to 1997 have just been published under the title The Best of Enemies – the cover picture of Thatcher and Major makes clear that the theme of the volume is Tory division.

The book is relevant today, particularly for the period leading up to the 1997 election, as a divided and ill-disciplined Tory party that had been in power for a long time headed towards all-but-certain defeat. On 28 February 1997, Fowler wrote: “We lose the Wirral by-election by a mile – a 17 per cent swing against us. Why do we think this is all going to change by the time of the general election? Why do we assume the conventional political wisdom that it will be ‘much closer than you think’?”

Then, as now, the disloyalty of former party leaders and their supporters is striking. Thatcher was persistently unhelpful, and her followers attacked Major’s Europe policy. Some pro-EU Tories who should have supported Major were just as bad. Fowler was furious with Geoffrey Howe in early 1995 for saying that Major should have formed a coalition with Labour against the Tory Eurosceptics. For Howe, said Fowler, “Europe comes way above petty things like party politics and the survival of a Conservative government.”

As the election drew near, Fowler was taken aback when canvassing in his Sutton Coldfield constituency. He came across a Tory voter who asked: “Tell me privately, are you really trying to lose this election so that Labour can inherit all the problems that there are?” Fowler said he seemed “absolutely serious, convinced that there was some rational explanation for our behaviour. If only that was true.”

As an aside, Fowler’s contemporary account reminds us that the gods are laughing at us mortals trying to predict leadership elections. On the Sunday before polling day, Fowler wrote: “In the press a Tory defeat is taken for granted and all the speculation is about who will be the next Tory leader: Portillo vs Heseltine seems the likeliest choice.”

Four days later, Michael Portillo lost his seat and two days after that Michael Heseltine was admitted to hospital and announced that he would not be a candidate. William Hague ended up defeating Kenneth Clarke. We should not assume too much about Kemi Badenoch, Penny Mordaunt and James Cleverly.

However, the main point of rehearsing this ancient history is to try to work out how today’s Conservatives might deviate from the apparently inevitable trudge to humiliating defeat.

The big difference between then and now is the state of the economy and public finances. It was only three years after the 1997 election that Gordon Brown boasted of a budget in surplus, raising more in taxes than he was spending. That is not where Rachel Reeves is going to be in 2027.

The Conservative trick of tying Labour to its post-election spending plans could work differently this time. In 1997 the voters felt rich enough to take a risk on Labour, and once elected Brown was able to impose stealth taxes on pensions (£5bn a year was worth something then) without the tax-paying goose hissing too much.

This time, Labour’s promise not to raise taxes is less convincing, and voters might be less inclined to take a risk on it.

That was the strategy behind the autumn statement on Wednesday. The message was “tax cut”. It may be a cheat, but people will feel better off in February, when the lower rate of national insurance contributions takes effect. The election message was the implied contrast: “Taxes will go up under Labour.”

It has been messy getting here, but Rishi Sunak is finally achieving clarity on the only message that offers the Tories any hope. He has dropped the embarrassing “I am change” line that confused his otherwise sensible party conference speech in Manchester. The only line that has a chance of working is: “Whatever they say, Labour will put your taxes up.”

The Labour Party thinks it is ready for it, but it is not. Reeves, the shadow chancellor, is not as ironclad as she makes out. In Prime Minister’s Questions just before the autumn statement, Keir Starmer made an unfunded spending promise. He suggested employing “thousands” of mental health support staff, paid for by closing unspecified tax loopholes.

Reeves has said that Labour is committed to only three tax rises: the abolition of non-dom status, the imposition of VAT on school fees and taxing gains on private equity funds as income, not capital. Yet there was her leader, right in front of her, promising to spend more money without saying where it would come from.

Of course, more mental health support is a good idea, but so is universal credit for third and fourth children, and Labour isn’t promising that because it says it is going to inherit a difficult fiscal position.

Starmer’s words on Wednesday suggest that Reeves has not nailed everything down yet. So far, she and Starmer have got away with it because Tory HQ seems to be asleep. But it will wake up at some point and it will attack Labour’s fumbles ferociously. Reeves has tried to postpone and shrink the extra £28bn a year of borrowing for green investment in Labour’s plans, but there is still a big chunk of it left. There are other costs, such as the promise to decarbonise the country’s entire electricity supply within six years, that Tory HQ has not yet wrapped around Reeves’s ankles.

Maybe things are too far gone for the Tories, and none of this matters, because the voters have already decided that it is time for a change. But there is a chance that “Labour will put up taxes” will have some effect, and Reeves and Starmer are not doing enough to close it down.

Fowler’s diaries end with Tony Blair thanking Bill Cash and Michael Spicer, “two of the leading Tory sceptics,” for “the contribution they have made to the election of his government”. I don’t know who will keep the best diary of the next year’s events, but will this story end on a similar note?