How will Keir Starmer and Rachel Reeves cope now their main policy has been stolen?

Labour has won a huge victory, dictating government policy – but what is its next trick, asks John Rentoul

Apart from the windfall tax to pay for help with energy bills, what policies does Labour have? (PA)

It may seem strange to see a momentous Labour victory as a problem for Keir Starmer and Rachel Reeves. It is the kind of problem that the Labour Party has been desperate to have since it lost power 12 years ago. But it is, nevertheless. a problem.

The Conservatives have stolen their policy. Indeed, Rishi Sunak’s main criticism of the Labour plan was that it wasn’t ambitious enough. He announced more generous help with people’s energy bills than Labour proposed, funded by a bigger windfall tax on oil and gas companies.

It is not obvious that the chancellor’s sums add up. The more he spoke of fiscal responsibility, the clearer it was that he was announcing huge numbers with only a vague idea of how to pay for them. He and Boris Johnson were in such a hurry to announce what was in effect an entire Budget that most of the details will have to be sorted out later.

Most of the measures will probably be funded by the windfall tax – now called an energy profits levy – and higher-than-expected general tax receipts, but if there’s a gap to be covered by extra borrowing, they will worry about it at the time of the actual Budget in the autumn.

What Sunak tried to do today was to eliminate the Labour Party as an alternative government by adopting its one big policy, and doubling it. And that is a problem for the opposition because it has so little else. Apart from the windfall tax to pay for help with energy bills, what policies does Labour have?

The sudden blankness of the Labour manifesto for the next election was evident when Starmer responded to the Queen’s Speech earlier this month. He spent a large part of his speech on Labour’s plan for a boost to the Warm Homes Discount paid for by a windfall tax, but when he turned to the rest of the programme of the alternative government, the cupboard was almost bare.

“Labour would improve leadership and teaching standards at state schools,” he said, “funding it by ending tax breaks for private schools. It means a government of the moment that would finally deliver world-class mental health provision that matches years of empty rhetoric on parity with physical health. Labour would hire new clinicians so that we can guarantee mental health treatment in four weeks, paid for by closing loopholes to private equity firms.”

This sounded like an early draft of a Labour pledge card, featuring a handful of believable promises paid for by identified sources of funding. But without the windfall tax, the voters are likely to say: “Is that it?”

So far, Labour has focused on gloating over the government’s U-turn. Reeves started her victory speech by claiming that Labour is “winning the battle of ideas” and ended it by echoing Tony Blair’s taunt of John Major from 27 years ago: “When it comes to the big issues facing this country, the position is now clear: we lead; they follow.”

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But there will be a problem tomorrow in opposing a Conservative government that is so ideologically flexible that it takes the advice of John McTernan, Tony Blair’s political secretary. If he were advising the Tories, he said when he spoke to King’s College London students recently, he would say: “You won Labour voters; give them Labour policies.”

Such flexibility causes problems on both sides of the Commons, but it was striking how subdued the tax-cutting punk-Thatcherite tendency on the Tory back benches were in response to Sunak’s statement. Richard Drax complained about “red meat for socialists”; John Redwood, John Baron and David Davis grumbled a bit.

But I think Labour’s victory creates a bigger problem for the victor than for the vanquished. Labour put out some social media adverts crowing: “Labour forces Tories to U-turn on the windfall tax.” Shadow ministers took the line: if this is what Labour can achieve in opposition, imagine what we could do in government.

Well, yes, we might like to imagine what they could do in government, but they would need to give us a clue. Not being Jeremy Corbyn got Starmer a short way. Not being Boris Johnson is doing quite well for him now – although that is vulnerable to the Tory party deciding that it, too, would like a prime minister who isn’t Johnson. But what would a Labour government do? The windfall tax was only ever a holding position. Now it has gone, it is time for some answers.