Sunak and the furlough factor

Getting the nation back to work

TWO REASONS explain why confidence in Rishi Sunak is so high just 100 days after he became Chancellor – he’s already one of the most able politicians in a Cabinet short on talent and he’s effectively paying millions of working-age people to stay at home on ‘furlough’ to protect public health.

Yet, while it is only a matter of weeks since the Richmond MP’s promotion on February 13 after Sajid Javid quit as Chancellor in a power struggle over influence of a certain aide by the name Dominic Cummings, the economic landscape is vastly different.

Then Britain was still hoping to avoid the worst of the Covid-19 pandemic. Now the UK-wide death toll is approaching 40,000 – and the country facing its sharpest recession in history – as the already daunting challenges facing Mr Sunak over the public finances mount by the hour.

Having had to react to a fall in interest rates on the morning that he delivered a well-received Budget when just weeks into his role, he’s in the unenviable position of preparing a much delayed Comprehensive Spending Review in a mounting recession, a plan is also supposed to be tackling social care funding reform.

In the meantime, Mr Sunak needs to reduce the country’s dependency on the ‘furlough’ state subsidy scheme – his decision to ask employers to make a modest contribution towards the salaries of staff on leave is a fair first step despite the difficulties that it will cause to some – while drawing up an economic rescue package by the summer.

All this while trying to balance the books, rescue key public services and prove his mettle against his ‘noisy’ neighbours in Downing Street.

Yet, while the Chancellor’s greater tests will come when he has to start saying ‘no’ to funding requests, this region – and country at large – will ultimately benefit if he uses it as an opportunity to accelerate the ‘levelling up’ and Northern Powerhouse agendas. They matter now more than ever.