Labour MPs' rage over election results simmers on

"It's all depressing to be honest". Those are the words of one Labour MP, hitherto proudly supportive of the government, as they returned to Parliament on Tuesday morning.

The anger among Labour MPs in the aftermath of the party's local elections drubbing was striking in its breadth and depth. The evidence so far is that it did not dissipate over the long weekend.

The focus of many MPs' rage - and it is rage - is the means-testing of the winter fuel allowance.

It is not just the view of critical MPs that this harmed Labour in the elections, but of cabinet ministers too.

Earlier Health Secretary Wes Streeting told Breakfast: "I'm not going to insult your viewers by pretending that winter fuel didn't come up on the doorstep, of course it did, and I know that people aren't happy about winter fuel allowance in lots of cases."

Government sources have been scotching the suggestion that a formal review of the policy is underway.

Yet it is striking that Streeting opted not to advance a full-throated defence of the decision to means-test the benefit, even though he did stress that the government had sought to protect the poorest pensioners, and that it was forced into making unpalatable choices by the economic situation it inherited.

Some MPs believe that reversing the policy on winter fuel would be the clearest sign to the public that the prime minister, as he said on Friday morning, "gets it".

Others closer to government thinking question whether there would be any political benefit to changing course at this stage, believing the damage has been done.

But it is worth stressing - again - that this is a discussion taking place among those loyal to this prime minister and this government. Its resolution may not come until next winter. More topical perhaps is the debate over the government's welfare reforms.

The changes in eligibility for Personal Independence Payment (Pip) were announced in March but require parliamentary approval. A vote in the House of Commons is likely next month.

Given Sir Keir's colossal majority there is no prospect of the government losing that vote. But there is the possibility that it becomes the locus of broader disaffection with the government's direction.

One Labour MP who identified winter fuel and Pip as the two key reasons for Labour's poor showing last week said the latter was a more acute problem.

"When people were complaining about winter fuel on the doorstep you'd look at the [canvassing] sheet and often it's people who have never voted for us or haven't voted for us for a long time. With Pip, they were our people."

Even those Labour MPs who are more frustrated than angry at the decline in the party's support over the past ten months believe that Sir Keir and his team need to do more to carry their parliamentary ranks with them.

"There's still a lot of goodwill," one said. "But if we don't have a sense of what the strategic direction is soon then the PLP [Parliamentary Labour Party] will become unmanageable."

Pat McFadden, one of the most senior cabinet ministers but also the director of Labour's successful 2024 general election campaign, will deliver a presentation to MPs about the local election results on Wednesday evening.

Questions about the party's strategic direction will be paramount. Though the principal beneficiary of Thursday's local elections at Labour's expense was Reform UK, there are plenty in Labour who worry just as much about bleeding votes on their left flank to more progressive parties such as the Greens.

Many are noting that in the Runcorn and Helsby by-election the Conservative vote more than halved, at least partly due to defections to Labour to stop Reform. Meanwhile, the Green vote actually nudged upwards.

"We couldn't squeeze the progressive vote - and we'll need to do that at the general election," one government source said.

Cooler heads believe that in the scenario of a general election where the most plausible prime ministers were Sir Keir or Nigel Farage, voters on the broad left would inevitably coalesce around Labour.

And whereas the next general election is as much as four years away, events over the next few weeks could help.

A UK-EU summit on May 19 is seen as an opportunity to put significant meat on the bones of the European "reset" for which the prime minister has spent much of the past year pushing.

Party strategists believe that a clear demonstration from the prime minister that he believes the UK should be more closely allied to Europe will boost progressive support.

It could also solve other problems. If the Office for Budget Responsibility (OBR) were to upgrade its forecasts for economic growth as a result of closer ties to the EU, then that would give Rachel Reeves more money to spend in this autumn's Budget.

Before the EU summit, however, comes next week's immigration white paper - which will contain more detail of the government's plans to reduce legal migration and improve the asylum system.

This is seen in government both as a crucial way to demonstrate to sceptical voters that Labour is serious about dealing with their concerns about immigration, as well as a potentially tricky moment for the progressive segment of Labour's coalition.

"We can't be sheepish about this, we need to make an argument to our own people that there's nothing progressive about letting people smugglers run the English Channel or letting cheap foreign labour undercut good wages," one government source said.

And once the rage subsides, many in the Labour Party remember that things could be worse.

Unlike the Conservatives, confronting arguably a much deeper malaise, Labour are in government at control of the levers of power.

"Things are going to materially improve over the coming years," a senior government source said. "There is no way through this that doesn't involve making people feel better off."