Very smart, very hard-working and even more ambitious. That’s how her Labour “comrades” describe Rachel Reeves, who is set to take the reins of the Treasury in Keir Starmer’s new government. Together with Starmer, it is she who has led the “transformation” of Labour into a party that seeks business cooperation in its core objectives. Those are: stimulating growth and making the country a clean energy superpower. Both require private capital.
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The City of London voted Labour in this election, a dramatic turnaround from 2019, when Jeremy Corbyn spooked the business world and the markets with a left-wing programme that emphasised nationalisation and higher corporate taxes and high incomes. With that programme came the party’s worst performance since the 1930s. Today’s performance, by contrast, is close to Tony Blair’s triumph in 1997.
A few days ago, Rachel Reeves met with business representatives. When asked how the infamous change promised by the Labour Party would happen, she clarified: “With iron fiscal discipline”, reminding us of Margaret Thatcher. Her determination and tough profile, as well as some of her positions, earned her the nickname “Labour Thatcher”. But there are also important differences with the Iron Lady. So let’s take a look at who the 45-year-old politician is and what she represents.
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Your positions
Reeves does not believe in supporting families through welfare policies. What the British need is stable jobs and the generation and distribution of wealth. “No one should expect a government to want citizens to live on benefits,” he clarified. He also does not believe in high taxes and therefore also stresses the importance of private investment for development, which is the main priority of the Labour Party. These positions are not far from Thatcher’s, although she points more towards the US Democrats when asked about her political model.
She also has a huge difference with the Iron Lady: her attitude towards privatization. Not only is she not planning a tsunami of privatizations, but she also wants a kind of renationalization of sectors that are critical to the economy, especially energy.
James Wood, professor of political economy at Cambridge, told AFP that Labour and Reeves were trying to send a message that they would pursue “responsible” policies.
“When she talks about iron discipline, she means her aim is to tackle deficits and that she will pursue a prudent fiscal policy. She wants to send the message that she will get the British economy going again, but in a responsible way.” She also attacked Liz Truss for the crisis she caused in 2022 when, just 49 days into the job, she pushed pension funds to the brink and sent mortgage rates soaring.
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Your resume
His studies and career
Rachel Reeves was born on 13 February 1979 in Lewisham. She is the daughter of teachers and attended an all-girls school. At the age of 14 she became a chess champion. She studied economics at New College, Oxford (BA) and continued her postgraduate studies at the London School of Economics.
Her first job after finishing school was at the Bank of England. She moved to Leeds in 2006 to work for the retail arm of HBOS, the British private banking and insurance giant. She then received, as she put it, an offer to work at Goldman Sachs, but turned it down, even though it would have made her “a lot richer”.
Reeves often cites the influence her father had on shaping the political views of her and her sister, Ellie Reeves, who is also a Labour Party member. He joined the Labour Party at the age of 16.
His political career
In 2010, when the Conservatives came to power in coalition with the Liberal Democrats, Reeves was first elected as a Labour MP for Leeds West in northern England. Eleven years later, Starmer appointed her Labour’s chancellor of the exchequer.
After winning re-election on Friday morning, she acknowledged the scale of the task ahead, with pressing concerns about repairing broken public services and a cost-of-living crisis.
Hard work, tough choices
“I know the path ahead will not be easy. There are no quick fixes and there are hard choices,” she acknowledged. “We have no illusions about the magnitude of the challenge we face or the seriousness of the challenges we will inherit from the Conservatives,” she added. Asked to comment on the strong possibility of being the new finance minister, she said: “It would be a great honour. It will come with a great deal of responsibility. It will require hard work and tough choices. I am ready for them.”