Labour billionaire backer John Caudwell ‘nervous’ about Starmer after winter fuel ‘fiasco’

A high-profile millionaire Labour backer has revealed he is “increasingly nervous” about the direction Keir Starmer’s government is taking.

Phones 4u founder John Caudwell switched allegiance from the Tories to Labour before last year’s election, saying he was “amazed” at how Sir Keir “has transformed the Labour Party and brought it back from that Corbyn brink”.

But Mr Caudwell, who had donated £500,000 to the Conservatives ahead of the 2019 general election, has now hit out at the “anarchy within the party”, condemning the government’s winter fuel U-turn “fiasco” and welfare bill climbdown.

Speaking at a launch of a report from his charity Caudwell Youth about Sir Keir’s party, The Guardian reported he said: “They’re just going to be tossed from pillar to post, that’s how it feels.

“I am becoming increasingly nervous about what Labour are doing and especially when they get into this mess over the welfare bill because it feels as though there’s anarchy within the party.”

His comments come as Sir Keir faces another rebellion from his backbenchers over reforms to support for children with special needs in England, just days after he was forced into the humiliating climbdown on benefit cuts.

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The businessman – who has a fortune of £1.58bn but has promised to give away more than 70 per cent – also warned a wealth tax would be “very destructive” to growth, as he called on ministers to do more to bring investment into the UK.

He also urged Labour to do more on net zero, describing schemes such as Great British Energy as “lacking in ambition”, although he welcomed green energy plans that the party has implemented.

He added that, despite his background in mobile phones, he fears social media and AI are a “disaster” for anxiety and said he is worried for a future in which AI fakes become the norm.

Mr Caudwell supported the Conservatives for 51 years and became one of the party’s biggest donors when he gave £500,000. But for last year’s election, he pledged to vote Labour for the time ever and urged others to do the same.

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He is a prominent Brexit supporter but said the urgent need to tackle the climate crisis is the reason he could never support Reform UK.

However, he did say he welcomed some key changes from Labour, citing pension funds reform and planning changes.

Speaking during the launch, he continued: “There seems to be a lack of that commercial intellect that we desperately need in government to make long-term right decisions...

“I despair of politicians in general. You’ve got to attract inward investment to create high-paid jobs and in technology, sciences and especially in the environment, since that’s going to be the absolute future of mankind.

“There’s so much we need to do and there’s so little we do, and that was the Conservative party before and now it’s the Labour party.”

He also insisted he did not regret switching allegiance.

Mr Caudwell called on Sir Keir to be bolder in his second year leading the country. “I’d be a bit like a [version of] Trump who’s smart and who’s humanitarian,” he said. “And I’d force things through. You wouldn’t do any of the same things [as Trump], but it is what we need.”

This article was amended on July 8 2025. It previously inaccurately referred to Mr Caudwell as a Labour ‘donor’, instead of ‘backer’.