Keir Starmer’s biggest gamble yet? Backing Liz Truss on bankers’ bonuses

Shadow chancellor Rachel Reeves said Labour will ‘unashamedly champion’ the City, writes John Rentoul. A lot of Labour voters won’t like it – and that suits her fine

The scrapping of the cap was announced by Liz Truss (UK Parliament/EPA)

Sometimes politics is painted in primary colours, and a splash of an unexpectedly bright shade catches the voter’s eye. Keir Starmer and Rachel Reeves’s refusal to reimpose a cap on bankers’ bonuses may be one such moment.

It is the boldest statement yet that the Corbyn era is dead and buried. The scrapping of the cap was announced by Liz Truss during her brief period as a punk libertarian prime minister, and was delivered by Rishi Sunak, the “out-of-touch” former Goldman Sachs banker, at the end of October last year.

At the time, Reeves led Labour’s condemnation of the decision, “in the midst of their cost of living crisis”, which, she said, “tells you everything you need to know about this government”. Now she says she won’t restore the cap if she becomes chancellor, which tells you a lot, if not quite everything you need to know, about the character of a probable Labour government. Labour is now as pro-banker as the pro-capitalist government it seeks to replace.