London Playbook PM: The U-turns are getting
quicker
By Emilio Casalicchio
January 8, 2026 6:02 pm CET
London Playbook
By EMILIO CASALICCHIO
with NOAH KEATE
Good afternoon. This is Emilio Casalicchio.
TOP OF
THE NEWSLIST
THE
U-TURNS ARE GETTING QUICKER: Keir Starmer is under fire over another massive
U-turn. But at least Labour MPs might be allowed back into pubs to drown their
sorrows about his buffeted government.
Indeed
it’s true: Playbook PM can confirm all the reporting this afternoon that the
Treasury will water down its business rates hike for pubs in the next few days.
It’s the fastest U-turn of this Labour government so far, and comes after
climbdowns on the two-child benefit cap, welfare reform and winter fuel
subsidies, among others.
Reminder:
It was less than two months ago that Chancellor Rachel Reeves cut pandemic-era
business rates discounts from 75 percent to 40 percent and said all discounts
would end from April. The announcement coincided with confirmation the
“rateable values” for pubs, which councils use to calculate exact business rate
bills, would see sharp increases.
But but
but: Now government officials are confirming that outrage from the leisure
sector prompted Reeves to commission work into a support package for pubs. The
package is expected to include changes to licensing rules and regulations that
have been trailed over the past week or so. But it will also include both short
and longer term financial help, including tweaks to the rateable value changes,
as well as changes to how business rates are calculated ahead of the next
valuation in 2029.
The
excuse: The claim is that rates for individual businesses are confidential, so
Reeves and co. didn’t know how specific pubs would be impacted under the
changes. All the Treasury had access to before the budget were aggregate
changes in rates. But the pubs kicking up a fuss about their new rates since
the announcements have revealed the large gulf between what different boozers
will have to stump up. Some have been big winners from the changes, others big
losers.
Other
takes are available: The Tories are of course not accepting the government
claim it was a lack-of-data issue. “Yesterday Keir Starmer told us Labour had
‘turned a corner’,” Conservative boss Kemi Badenoch said on social media.
“Well, it looks like they’ve turned the corner straight into their first U-turn
of 2026.” She’s on the attack on LBC around now. Her business spokesman Andrew
Griffith said Labour was “wrong to attack pubs and now have been forced into
another screeching U-turn.”
Just get
on with it? Lib Dem Treasury spokesperson Daisy Cooper urged ministers not to
faff around for much longer. “Ministers must give [pubs] the clarity they so
desperately need so businesses don’t go to the wall, hollowing our communities,
in the coming days.”
Bittersweet:
Lots of Labour MPs (who had been banned from more than 1,000 pubs over the row)
are pleased but exasperated at the chaos in government. “It doesn’t make us
look competent, does it?” one said. “But at least we didn’t wait 14 months of
eating sh*t before we decided to U-turn, like we did on the farmers’ tax.”
Learning
the pattern: There’s some dark-humored grumbling that the U-turn was so fast
more backbenchers didn’t have time to join the anti-campaign and take credit
for the climbdown.
But but
but: Some Labour MPs are also noting the hit was not to pubs alone, and want
the government to go further. It’s clear that’s where the campaign is moving
next. “The entire hospitality sector is affected by these business rates hikes
— from pubs and hotels to restaurants and cafes,” said UKHospitality Chair Kate
Nicholls. Griffiths said the “humiliating about-face does nothing for shops,
restaurants, hotels and markets.”
Bear in
mind … the Tories see poll rating opportunities on all things economics, as the
New Statesman’s George Eaton wrote about this morning, so won’t let this go.
Known
unknowns: Whether other businesses might benefit is one of numerous unanswered
questions about the planned U-turn. Officials are declining to comment on that,
as well as whether some pubs who had been rates winners under the existing
plans could end up stumping up more after the coming tweaks. Officials are also
declining to comment on whether the U-turn will cost the exchequer, and where
the cash will come from if so.
Not to
mention … we still have zero detail on what the U-turn actually entails. If only there were an afternoon lobby
briefing, so hacks could ask these important questions on the record, as the i
Paper’s Hugo Gye pointed out.
Speaking
of U-turns: Starmer was at a children’s center in Bedfordshire this morning to
celebrate the recent one on lifting the two-child benefit cap. And Farming
Secretary Emma Reynolds was out and about celebrating the latest one on
agricultural inheritance tax.
No more
backtracking … right? While protesting tractors continued to blare their horns
outside the Oxford Farming Conference this morning, Reynolds insisted “in terms
of inheritance tax changes, that is it.” Let’s see if that holds. At least she
got a good reception from the farmers inside the hall including from the NFU
and CLA. It’s nice to be liked in politics. Much nicer than sticking to
difficult choices.
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