A May general election would hide the green shoots of Tory recovery

A number of key trends will turn in No 10’s favour in 2024, but the results will not be immediate

Once again, there’s talk about a spring election. A Budget has been called for March 6, which could tee things up for a May 9 ballot. This would end, all polls suggest, in a landslide for Sir Keir Starmer.

So why would the Tories do this? Because the alternative, some argue, would be worse: another six months of economic misery and feuding, culminating not just in defeat but annihilation. So Rishi Sunak could do the decent thing and go early. Limit the damage. Make it a survivable defeat, not something worse. Announce a tax-cutting Budget then hope for the best.

I’m not so sure about this logic. This year certainly has been cruel to Sunak: the Rwanda humiliation, strikes, the resignations and feuding. But look closely and you can see a number of trends starting to turn good. Not enough to save him, perhaps, but enough to say that his policies are working.

As implausible as it seems now, 2024 could be the year of Tory green shoots.

Let’s start with the big one: net migration. By the time officials started counting it properly again after the lockdowns, the figure had jumped to 745,000 – twice as high as pre-brexit years. Cue political panic and big crackdowns.

But the migration jump was fuelled by a post-lockdown rush coupled with the Hong Kong and Ukraine settlement schemes. These trends are over and the result is a figure falling so fast that Sunak could probably pledge to halve net migration next year. Small boat arrivals are also slowing and may soon hit a four-year low.

His other pledge, to cut NHS waiting lists, will start to come good next year. When he fatefully pledged to reduce the list, back in January, 7.2 million were waiting for an appointment. Now it’s 7.7 million.

Had he consulted the Department of Health before making this pledge (he didn’t), he’d have been told that a steep rise in 2023 was unavoidable. It was one of the many hangovers from lockdown: people who had been discouraged from seeking help at the time were coming forward and booking appointments. Even an NHS working at extra capacity would not cope.

But all along, those waiting list numbers were expected to peak about now, as the lockdown effect ran its course. So the numbers should steadily fall right up until the general election and long past it, giving a regularly updated narrative of NHS progress.

The junior doctors’ strikes will, of course, complicate this process, but the direction will be downwards. As you would hope from a health service that is, now, one of the best-funded in the world.

While there won’t be much economic growth, we will see mortgage rates fall throughout next year. Just over half of mortgage holders are on a five-year fix, with a further third on two-year or variable rates. So millions read mortgage charts anxiously, working out how much pain will be in store when renewal time comes.

Until recently, it has been a horror show. Rates spiked worldwide (although, here, Liz Truss was blamed) and had a second spike last summer with the average UK twoyear fix hitting 6.86 per cent in July. But they’re on a downward trend (5.9 per cent now) and should keep falling next year. The Bank of England may well cut the base rate four times before next Christmas, each time bringing more relief.

We’re unlikely to see the old, rock-bottom rates for a while, if ever again. They’re likely to settle back at closer to 3 per cent. The old zero era may come to be remembered as the years of monetary madness before the inflationary nightmare. But throughout next year, the story will be one of improvement.

If inflation keeps dropping faster than expected then wages may once again start to substantially outstrip price rises. A basic for a properly functioning economy, but something Britain hasn’t seen for some time.

Sunak is forever trying to claim credit for this global trend, making out as if he tamed inflation by holding firm on pay-rise demands. Few economists agree, but it’s one of these political fibs that is repeated nonetheless. Behold: the effective Tory cure! “Yes, it hurt,” Sunak could say. “Yes, it worked.”

He’s lucky that the trend that is going calamitously wrong – welfare caseloads – is one no one really cares about. An official update was slipped out before Christmas, taking account of the recent promises of closing loopholes. The disability caseload is expected to rise by 920 a day for the next five years, which would be a social and economic catastrophe. But all parties have agreed not to talk about this, so the welfare crisis remains the problem that dares not speak its name.

The obvious trick next year will be for Jeremy Hunt to repeat his ruse of claiming to cut taxes, while not admitting to the stealth taxes imposed by freezing tax thresholds. The hidden pain is significant: four million more are set to be caught by income tax; three million more by the 40p rate.

The No 10 strategy, so far, has been to talk only about the National Insurance cuts and claim to have made the biggest tax cut in decades. But it’s hard to argue with payslips. A cleaner on the minimum wage will pay £135 a month of income tax at the next election: 46 per cent higher, thanks to those stealth taxes.

This is the risk of a May election boasting about tax cuts from a March budget: if the claim is untrue, it will be easily rumbled. Forecasts for the total tax haul are not hard for voters to find, let alone the Opposition. In general, it’s best not to boast about tax cuts unless taxes are genuinely falling.

But next year will bring a decent number of stories to tell that are actually true: migration, inflation, mortgage rates, waiting lists and small-boat arrivals all on the way down. These trends might not all be clear by May but they certainly will become so as the year goes on.

So is it better to fight the campaign on real achievements, or illusory ones? If Sunak wants the former, a December election may be the more tempting option.

In general, it’s best not to boast about tax cuts unless taxes are genuinely falling