“Membership in my constituency is falling and that’s a good thing”. So declared Rachel Reeves while speaking to the Financial Times in 2022. At the time Labour was struggling to raise funds, but the Leeds MP deemed the loss of revenue a price worth paying. People had left “who should never have joined the Labour Party,” Reeves said. “They never shared our values.”

Fast-forward to today, and the same problems persist. According to LabourList, the party is unable to balance its books this year, and will need “at least £4 million” to fight elections in 2026. If Labour’s income remains this low, the party may have to use its reserves — or resort to borrowing. With major elections looming across England, Scotland and Wales next year, the party’s lack of funding could seriously hamper its ability to campaign effectively.

It wasn’t always like this. Under Jeremy Corbyn, Labour generated £56 million in 2017 — a record, and £10 million more than the Conservatives. Much of that was a consequence of the party’s 600,000-strong membership, which swelled under Corbyn’s leadership. Today, that membership has faded. Earlier this week, at a meeting of its National Executive Committee, Hollie Ridley, Labour’s General Secretary, refused to disclose the party’s most recent membership figures, citing potential “leaks” as the reason. The move breaks with long-standing precedent. The NEC, which functions as Labour’s governing body, has traditionally been kept informed of key metrics — especially those bearing on the party’s financial health. For such information to be withheld is astonishing.

It isn’t hard to grasp why Ridley made the decision, however. In August last year, party membership fell below 400,000 for the first time in a decade. Then, in February, it fell further to 309,000. That same month, Reform announced it had surpassed 200,000 members, with Nigel Farage declaring his intention to overtake Labour at some point this year. It may be that it has already happened, or is close to hand. Hence the sudden predilection for secrecy among Labour’s top brass.

Clearly, there are material advantages to being a truly mass organisation. Better canvassing and campaigning are obvious benefits, not to mention a larger talent pool for candidates. But it also means predictable revenues. As any business will tell you, recurring payments are like gold. The prospect of taking out loans while core revenues rapidly shrink speaks for itself.

The bet made by Starmer’s Labour may have been that the fall in revenue from members would be covered by donors and sponsorships as the party moved closer to business. That Labour tried something similar in the late 2000s, and failed dismally, doesn’t appear to have prompted much reflection. Besides, even this strategy appears to be failing. High net worth individuals — so central to the party’s fundraising strategy ahead of the last election — appear to be backing away. Last month Sacha Lord, a Labour donor and prominent backer of the party in 2024, asked whether the Chancellor’s tenure was tenable.

If Starmer believes he can win again without rebuilding the movement that once bankrolled it, he is in for a shock. The warning signs are all there: dwindling membership, nervous donors, and a party apparatus reluctant to confront hard truths. In 2026, it won’t just be votes that are in short supply — it will be money, trust, and power, gone too.

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Aaron Bastani is the co-founder of Novara Media, and the author of Fully Automated Luxury Communism. 

AaronBastani

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