Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Sir Keir Starmer began a tour of Scotland, Wales and Northern Ireland on Sunday, with Britain’s new prime minister promising to “reset” relations between Westminster and the UK’s nations.
Labour won a majority in each of England, Scotland and Wales in this week’s general election, as Starmer secured 411 seats overall in a landslide that propelled his party to power for the first time since 2010.
The prime minister has said he wants to rebuild relations between his government at Westminster and devolved administrations, which were often strained during the previous 14 years of Conservative government.
Starmer’s tour begins in Scotland, where the Scottish National party holds power in the devolved Holyrood assembly. But the SNP only won nine national seats in the House of Commons, putting a huge dent in its push for independence.
“People across the United Kingdom are bound by shared beliefs,” Starmer said ahead of the tour. “Fundamental values of respect, service and community which define us as a great nation.
“That begins today with an immediate reset of my government’s approach to working with the first and deputy first ministers because meaningful co-operation centred on respect will be key to delivering change across our United Kingdom.”
Starmer will visit Edinburgh on Sunday before travelling to Belfast and Cardiff on Monday, his office said.
Starmer still has many more middle and junior ministerial positions to fill, but on Saturday he surprised many by bringing back a New Labour-era minister, Jacqui Smith, as an education minister. Smith will get a peerage.
The new prime minister also gave an immediate return to government to Douglas Alexander, a cabinet minister in Gordon Brown’s government, who won Lothian East from the SNP. He has been appointed a business minister.
Jonathan Reynolds, the new business secretary, is grappling with an immediate problem in how to alleviate looming job losses at Tata’s UK steel operations and is under pressure from unions to intervene decisively.
Reynolds told the BBC that he and Starmer had spoken to the company and would be seeking “jobs guarantees” as part of any improved offer of state support to the company.
Tata Steel is pushing ahead with the closure of two blast furnaces at its Port Talbot plant in south Wales, the UK’s largest steelworks, by the end of this year. The plan puts at risk up to 2,800 jobs.
Tata is set to invest £750mn to finance the restructuring, backed by a £500mn grant from the British government agreed but not fully signed off by the Conservatives.
Reynolds said there was “a better deal available” and added: “I’m going to make sure that job guarantees are part of the negotiation that we’re having.”
Sharon Graham, general secretary of the Unite union, gave a taste of the kind of pressure that Reynolds and other ministers will face in the coming months when she promised to be “a pain in the proverbial” in pushing for a more active government industrial policy.
She said Rachel Reeves, the new chancellor, should change the government’s fiscal rules rather than sticking to the borrowing straitjacket she inherited from former Conservative chancellor Jeremy Hunt.
Labour has said it will stick to Hunt’s rule of cutting debt as a share of national income year-on-year in five years’ time.
“Since 1997 the fiscal rules have changed nine times,” Graham said. “When you change them you have more opportunity. We are going to have to borrow to invest.”
She told the BBC that “people will not wait” for the growth promised by Reeves to materialise. “We will not get growth in time — we are not going to get that kind of growth quick enough,” she said.
Read the full article here
