LABOUR really needs its Budget next month to turn its fortunes around. Polls not only show a consistent lead for the far-right Reform UK, but Labour’s status as the main party on the left is increasingly challenged: it was humiliated by Plaid Cymru in Caerphilly a week ago, and is starting to fall behind the Greens in surveyed public support.

This, of course, is partly because Labour’s claim to be on the left at all is so unconvincing. Few people appalled by Reform UK’s racism and immigrant-baiting will find a Labour Party that indulges both an attractive alternative. Nor does its fawning on banks, landlords, property developers and Donald Trump recommend it to anyone normal.

Labour has long benefited from being the only game in town when it comes to providing an alternative government to the Conservatives: but that logic no longer holds when being one of the traditional Big Two turns off more voters than it attracts.

That, more than the emergence of alternatives on the left — which have so far attracted little interest from organised labour — calls into question the Labour link to affiliated unions, to which its main appeal for a generation has been being “better than the Tories.” Its biggest affiliate Unite has explicitly named the Budget as a potential test of whether continuing affiliation is worth it.

MPs should therefore view Starmer’s hints that the Budget will see rises to income tax with deep misgivings. This would break an election pledge, but that is nothing new for the serially dishonest Starmer.

More seriously, it would double down on the Prime Minister’s peculiar genius for landing on policies that both depress living standards and do so in a way that benefits the right.

As ITV political editor Robert Peston points out, raising income tax on higher earners alone is unlikely to bring in anything like enough money to solve Chancellor Rachel Reeves’s fiscal headaches.

It is most likely the government would raise the basic rate of income tax — so making the majority of working-class people pay more.

This after Tory and Labour governments have frozen tax band thresholds since 2021 rather than raising them with inflation, a regressive policy which loads more of the tax burden onto lower earners over time; and as workers are only just emerging from the longest wage squeeze since the Napoleonic wars.

Labour risks making people poorer when the key driver of the collapse in support for the political mainstream is the pervasive sense that most of us are getting poorer.

It would do so in a way that reinforces right-wing narratives that taxation is a burden, rather than by raising corporation tax to hit big business profits or a wealth tax on the billionaire class, steps that could make the case for taxation as a tool of redistribution.

And at a time when its failure to purge the NHS of private profiteers or invest in crippled public and municipal services and infrastructure guarantees continued decline, so people will feel tax rises as making them pay more for less.

This is politically suicidal, and it is the consequence of Labour’s refusal to act in the working-class interest: by nationalising utilities to bring down energy and water costs for ordinary people, harvesting the huge profits of banks, fossil fuel, agribusiness and tech companies to improve public services and taking on an elite who have accumulated staggering wealth while most people’s incomes fall.

Only such action, plus a complete overhaul of its approach to the housing crisis which will never be addressed by private-sector construction firms — modelling by Bombe.io and the General Federation of Trade Unions shows a lack of housing security is the biggest single driver of support for the far right — can rescue this Labour administration.

No-one imagines Starmer and Reeves will consider anything of the sort: a new leadership is urgent.