Ben-Riley Smith

poLitiCAL editor

Forget the recent missteps, says Jeremy Hunt, voters should know who they can trust with the purse strings

ASK anyone involved in the Tory election campaign to plot out how they can secure an unlikely victory, chances are they will soon be talking about one thing: the improving economy.

Financial data points are clung to like life rafts in a stormy sea, offering hope of escaping the politically tricky present and reaching an island of safety just beyond the horizon.

As much was clear yesterday as

Rishi Sunak and Jeremy Hunt both hit the airwaves from a Siemens factory in sunny Oxfordshire to own the positive economic signs.

The UK’s short, shallow technical recession in late 2023 was officially over, the Office of National Statistics declared, with GDP up 0.6 per cent in the first three months of 2024. Better yet, it came the day after the Bank of England indicated that interest rates are finally set to be cut. Traders are now pricing in two reductions before the end of the year.

To Downing Street ears, the news carried the ring of vindication for a Prime Minister who has made curbing inflation his central economic mission in the past 18 months.

More good news could be coming next week, when April’s inflation figures are expected by the Treasury to be within “touching distance” of the Bank’s 2 per cent target.

“I think most people see that Rishi Sunak knows how to manage the economy,” a No 10 insider said. “He had dealt with some extremely difficult, unprecedented times as chancellor. He has not necessarily done the easy things which would have been short-term politically good to do. But he has been a good economic steward and it is starting to pay off.”

Isaac Levido, the Tories’ Australian campaign chief, likes to tell people that fundamentally it is the economy upon which this coming general election will be won or lost.

A scan of recent results helps explain why. The Tories secured office in 2010 after pinning the blame for the financial crisis on Gordon Brown, then won their own majority in 2015 by urging voters not to hand the keys back to the party that crashed the economy.

Labour’s surprise showing in 2017, when no party won a Commons majority, came in part due to the backlash Theresa May faced over the realities of austerity – a mistake Boris Johnson avoided repeating with his spending bonanza in 2019.

The challenges, however, are twofold. The Tory attempt to regain their reputation for competent economic management has a Liz Truss problem.

Her mini-Budget has, rightly or wrongly, allowed a Conservative rosette to be pinned to rising mortgage rates – what Labour was quick to dub the “Tory mortgage bombshell”.

Last month, when Ms Truss released her defiant book,

Labour aides hurried round the parliamentary officers of media organisations handing out their own version. The title of the fake book read: “14 years to ruin a nation”, with the front-cover image a merger of Mr Sunak and Ms Truss’s faces. It carried a one-star review from “the British people”.

So it is interesting that Mr Hunt, as he laid out the argument yesterday for why the improving economy should lead Britons to vote Tory, zoomed out a little in scope as he defended their record.

For the Chancellor, one of the great survivors of the Tory upheaval since 2010, the party’s 14-year economic record is too often overlooked. In recent times, Mr Hunt has developed a habit of rattling off what he sees as the list of achievements.

A growth rate since 2010 that is better than Germany, France, Italy and Japan. A raising of personal tax thresholds that means workers today can earn £1,000 a month tax-free. There have also been the equivalent of 800 new jobs created every day since the Conservatives took office.

To Mr Hunt, these are the proof points of how the Tories are the best guardians of the economy.

Critics would point to other figures such as soaring NHS waiting lists as evidence of the long-term damage of austerity’s spending cuts.

For Mr Hunt, there is some personal pride in the defence, according to those who know his thinking. “He feels very strongly about it,” said one Treasury insider.

But there may be a political calculation too. Getting voters to think about a 14-year record moves eyes away from what Mr Hunt publicly admits were missteps in the Truss premiership. Which leads to the second challenge.

Forget the lines on a graph – is a country that has endured double-digit inflation and near zero growth really feeling flush with cash? That was the argument Rachel Reeves, the shadow chancellor, articulated on Tuesday in a calculated move to “spike the Tory guns” before the good news.

Ms Reeves’s claim the Tories were “gaslighting the British people” led to a spike in Google searches for the term.

This convinced her team that the speech had got the desired cutthrough.

The Tories were quick to repond. “This is the first ever recorded sighting of the Opposition criticising good news,” said a Treasury insider.

But there is a central point – the improving economy does have the potential to boost the Tory cause and must be countered by the Opposition.

When Mr Sunak was discussing electoral strategy with his MPs in a post-local election Downing Street briefing on Wednesday, he tried out an argument sure to be aired often publicly in the months ahead.

Addressing a Welsh colleague, the PM noted the Labour administration in Cardiff had failed to freeze business rates despite being handed the money to do so by London. “That is the blueprint for what you’d get with a Labour government,” Mr Sunak declared, according to one source.

His natural fluency on economic matters is seen by some No 10 insiders as one area he can skewer Sir Keir Starmer on in the election TV debates, pitches for which broadcasters have now made to the party leaderships.

There could also yet be time to squeeze in a third tax-cutting fiscal event before the election, although no decision on whether to hold an Autumn Statement has been made.

“The economy, stupid” was the famous line coined by Democratic strategist James Carville and hung in Bill Clinton’s campaign HQ during the 1992 US presidential race.

If the Tories are hoping to deploy something similar, Labour has already made clear what its rebuttal will be: “The cost of living crisis, stupid.”

Getting voters to lift their eyes from the fallout of Trusseconomics towards the Tory record since 2010 appears to be part of the plan to counter that line.