Labour MPs are hopping mad – and Rachel Reeves is going to catch it | Personal Finance | Finance

Labour held the Gorton and Denton seat for more than a century. Not anymore. Jack Polanski’s cynical and sectarian Green Party swept them into third place in last week’s controversial by-election and Labour MPs are in meltdown. They can see the same thing happening in their own constituencies, come the next election. Even Starmer may struggle to keep his seat.

Only one person can save them. That person is Rachel Reeves. Don’t laugh. She’s a key reason why Labour is in this black pit of despair. But she’s also the only one with the spade to dig them out of it. Which only goes to show how bad things have got.

Everyone’s miserable and angry, and our flatlining economy is a big reason. People feel skint and fear for their livelihoods. The Greens may be on a different planet, but winning candidate Hannah Spencer struck a chord when she said “working hard used to get you something”. It doesn’t seem to do that anymore.

It’s Reeves’ job to fix that. So far, she’s failed horribly. Next week she’s back on the frontline and she can’t afford to fail again.

The UK economy was showing the green shoots of recovery when Reeves marched into No 11 and ripped them up. In the last three months of 2025, our GDP grew just 0.1%.

Unemployment is rising, youngsters can’t find jobs, welfare claims are rocketing, companies are collapsing, entrepreneurs fleeing and the tax take is at an all-time high. The unreformed public sector gobbles up all the extra spending, and demands more.

The rest of the cabinet isn’t helping. Ed Miliband’s net zero levies are driving up energy bills and pushing industry abroad. Angela Rayner’s Employment Rights Bill will make companies even more hesitant to hire. Starmer’s plan to build 300,000 homes a year has flopped, exactly as I predicted.

In the run to last year’s Budget, Reeves spread chaos every time she opened her mouth. Since then, she’s decided to keep quiet.

Tuesday’s Spring Statement should be her big day, but many in the Treasury would rather she hid in a cupboard than deliver it. Instead, her plan is to say nothing of note, to prevent panic. That strategy won’t work now. Labour MPs want action. Mostly, they want to keep their jobs. None of them want to hunt for work in today’s jobs market.

Reeves is relying on economic events swinging in her favour and she may get lucky. Interest rates are falling, inflation is retreating and so are borrowing costs.

But Reeves is not a lucky chancellor, so she can’t rely on that. Especially since war in Iran could drive the oil price and inflation back up. She needs to get the economy moving. She needs to do… something.

Labour MPs are demanding big, bold moves. They want her to move to the left, to see off the Greens. That means more tax hikes, more spending, more nationalisation.

Reeves has learned her lesson. She knows that’s madness. But she may be forced into those growth-destroying measures anyway.

Today’s challenges would test the best chancellor. Instead, we have one of the worst. Reeves has nowhere to hide. The worst bit is that she doesn’t have a plan, and everyone knows it. Those Labour MPs better start brushing up their CVs.