The Daily Telegraph - Saturday - Money
Ben Wilkinson Personal Account
Sunak and Hunt have one year to restore a Conservative Britain – and bleak election forecasts show they have nothing to lose
Let’s face it, the Tories are doomed. If Labour’s by- election victories last month are anything to go by, the party will be resoundingly humiliated at the next general election. But this bleak forecast puts the Prime Minister and Chancellor in a unique position: they have nothing left to lose.
If they are truly condemned to lose, they should spend the next year putting into place policies that will ultimately leave Britain better off – even if it means guaranteed annihilation. The Autumn Statement later this month is the first opportunity the Government has to make an impact.
First on the list should be a bold shake- up of public sector pensions, which should be stripped of their limitless inflation- proof rises and annual increases capped at 5pc instead like those in the private sector.
This would irritate millions of workers, including strikers, who do not know how lucky they are to be guaranteed a retirement income that the taxpayer cannot afford. Yet it would save the public purse billions of pounds over time. It is another vote loser for sure, but the Tories should axe the triple lock state pension promise. A Parliamentary report last month said that if the state pension had been uprated with inflation alone since 2011, the taxpayer would be £10bn better off every year.
If we are to kill off inflation and pave the way for tax cuts, the whole country needs to feel the squeeze – not just working-age mortgage borrowers.
The party also needs to build more homes to ease the housing crisis and appease younger voters, and this should include building homes on green belt land. It would outrage Nimbys in Tory heartlands, but the compromise needs to be that these homes are built well and sympathetically to the landscape. Two other tax changes, which would be more popular among core voters, should also be made.
Firstly, inheritance tax should be abolished. The tax does not work as it should, with the very richest finding ways around it, while the unsuspecting middle classes are caught out. On top of this, the Tories should commit to increasing tax thresholds for higher earners when inflation cools – with the 40pc tax rate levied on earnings of £80,000 or over and the additional rate of tax restored to £150,000. It would help lower the tax burden – now at its highest since the Second World War.
As it stands, Labour is on track to inherit a recovering economy that has been responsibly nursed back to health. Labour certainly did not extend the same courtesy when it left power in 2010, along with the infamous note to say, “I’m afraid there is no money”. The polls are suggesting that Sir Keir
Starmer is now heading for a Labour landslide comparable to Tony Blair’s in 1997. Back then, former Labour home secretary Roy Jenkins described Mr Blair’s task in getting into No 10 as like carrying a “priceless Ming vase across a highly polished floor”.
The Tories now need to knock that vase right out of Sir Keir’s hands. The only thing that can save them is a set of unashamedly Conservative policies designed to rekindle aspiration and growth. The Tories have little over a year to restore a Conservative Britain – regardless of the cost to the party. ben.wilkinson@telegraph.co.uk