Joy and relief among Labour MPs was obvious, but tensions around donations, fuel poverty and Sue Gray’s salary lingered

Labour members cheered each time Keir Starmer referred to his work as prime minister during his speech. Photograph: Hugo Philpott/UPI/Rex/Shutterstock

It was a running joke at the Labour conference that no other party could hold its first gathering for 15 years as the government and still find reasons to be gloomy. But while there were undeniable tensions, there was much to celebrate – and people did.

The joy and relief of coming back from the disaster of the 2019 election to a 174-seat majority on 4 July was obvious throughout the gathering in Liverpool.

One minister combined word-perfect fringe meetings and broadcast rounds with nightly appearances in the bar of the main conference hotel until the early hours. At Keir Starmer’s speech on Tuesday, Labour members cheered each time he referred to his work as prime minister.

By the final night, on Tuesday, conference-goers at a UK music event were treated to the sight of Anas Sarwar, the Scottish Labour leader, and Emily Thornberry, the former shadow attorney general, dancing on stage to Mark Ronson’s Uptown Funk.

Later that night was an annual karaoke party hosted by the Mirror, where cabinet ministers including Angela Rayner, Rachel Reeves, Yvette Cooper, Wes Streeting and Lisa Nandy joined a posse of new Labour MPs in a delayed and very sweaty victory party.

Even here, however, there was some reflection. The loudest roars were for Jonathan Ashworth, central to Labour’s pre-election planning, who lost his Leicester South seat to an independent candidate by fewer than 1,000 votes.

Introduced by the MC as “Jonny Sparkles”, Ashworth joined Streeting, the health secretary, to belt out Don’t Look Back in Anger by Oasis before being pulled from the stage by Labour officials who embraced him.

Such spontaneity was a rare sight at a conference which, even by the standards of recent Labour gatherings, was controlled in its choreography and messaging and firmly centred on voices from the cabinet.

A smattering of new MPs took part in anodyne fringe events, but according to Labour officials, they had been warned against creating headlines, let alone generating controversies.

If you listened to the private grumblings of ministers and senior party figures, just two-and-a-half months into its existence the new government had enough controversies to be going on with, even if the more optimistic believed these to be largely temporary.

Most obvious was the mass of stories about donations accepted by Starmer and other ministers for clothes, spectacles, holidays and football tickets, much of it coming from the wealthy Labour peer Waheed Alli.

The extent of concern varied. Some said there should have been a stronger pushback against the stories. Some blamed the No 10 media team for not anticipating how the donations would look. But others argued that blaming the communications was to miss the point and that such mishaps should have been avoided in the first place – including by Starmer himself.

For most it was too soon to joke about “dressgate”, but at one late-night party, a cabinet minister teased a high-profile TV presenter by asking how much they received for their clothing budget.

Pat McFadden, the funereally dressed chancellor of the duchy of Lancaster, was heard grumbling that he was the only member of the “quad” of top ministers – Starmer, Rayner, Reeves and himself – not to be asked about his sartorial tastes.

A parallel gripe by some senior figures was about the endless news coverage about donations and the cut to the pensioners’ winter fuel payment. Some argued this was inevitable given the gap between announcing the winter fuel change in July and the spending review on 30 October.

Another recurrent theme was speculation about when No 10 and the Treasury might offer more in the way of hope to leaven the weeks of gloom about the fiscal inheritance and the sacrifices needed to stabilise the economy.

Such discussions tended to coalesce into a common theme: anxiety that this might be more than the usual stumbles of a government not used to the scrutiny of office, but instead symptoms of a congenitally dysfunctional No 10 operation.

One senior figure said: “We all hope it’s teething troubles. But we all worry in case it’s something worse.”

Some of the structural concerns centred around Simon Case, the cabinet secretary, and already the focus of much complaint. This, however, is temporary, as Case will leave the post in the new year, if not sooner.

The other focus is Sue Gray, Starmer’s chief of staff, varyingly portrayed as either a hugely effective unblocker of governmental logjams who has been the subject of deeply unfair and probably sexist briefings; or a political novice whose actions lead to recurrent bottlenecks.

It’s fair to say there is a deep divide among Labour aides and cabinet ministers about the extent to which Gray, who was not in Liverpool, is to blame for Labour’s rocky few months.

One said she should take responsibility for a number of damaging stories, including the Downing Street pass for Alli, and a paid civil service job for Ian Corfield, a Labour donor. There is also open fury about Gray being paid more than the prime minister when she has been notably tough over other advisers’ salaries.

Gray also has passionate defenders among cabinet ministers, many of whom credit her for better communication lines with Starmer amid the move into government. Whichever side people take, however, there is a consensus that the rumours of a battle between Gray and Morgan McSweeney, Starmer’s closest political aide, cannot continue.

According to cabinet ministers, Starmer realises he needs to get a grip on the briefing wars before they begin to define his government. Can he succeed? By the time the next Labour conference is over, we should know.