The image is of the slogan “We’re only making plans for Nigel” with the image of a guillotine. As with many commercially sold T-shirts, a cultural reference has been repurposed to make its satirical point. As an author, I look at the phrase “We’re only making plans for Nigel” and it doesn’t make sense beyond a very specific context. I would just write “We’re making plans for Nigel” which still retains either meaning, but where the word “only” has become redundant. My guess is that XTC simply inserted the word “only” to make the lyrics scan with the musical rhythm.