Inside the implosion of the Liz Truss project
Right from the start, allies of the outgoing Prime Minister knew that she was making fatal errors
It was the moment for which many of those who backed Liz Truss in the leadership contest had waited for decades. But, days before the then foreign secretary even entered Downing Street, some of her most ardent supporters were already expressing misgivings about whether she would be able to pull off her plan to implement “the biggest change in our economic policy for 30 years”.
Three supporters who spoke to The Sunday Telegraph in the days before the announcement that Ms Truss had won the Tory leadership contest conveyed fears that the incoming prime minister was already in the process of making her first grave error.
“I think Liz will surprise people a great deal,” said one of her backers at the time. “But she hasn’t had that much experience and it is a worry.” The supporter, like others who found political gravity pulling them towards Ms Truss, was particularly concerned about her decision to appoint Mark Fullbrook, a veteran lobbyist, as her chief of staff in No10.
The appointment was symbolic of a concern among some of Ms Truss’s backers that she had surrounded herself largely with “chums”, including past and present political advisers, rather than “competent ideologues” with a history of pushing radical measures through Whitehall, or selling them to the public.
Ms Truss’s critics within the Conservatives are adamant that it was her ideas that were her undoing – insisting that Rishi Sunak was correct to warn that her plan to cut taxes to achieve growth was a “fairy tale”.
But insiders who supported the Prime Minister insist that the problem was in the execution – partly stemming from the lack of experienced “ideologues” in her team. Ms Truss also decided to dramatically reduce the number of special advisers (spads) in Downing Street, which one a government source said “undermined her from the start” and another said reduced the “grip” she was able to exert on Whitehall.
The decision to appoint Mr Fullbrook as chief of staff raised eyebrows even among some of Ms Truss’s inner circle. Ironically, he was not an obvious “chum” of Ms Truss and her closest supporters knew of little, if any, previous connection between them. Those around her privately questioned Mr Fullbrook’s commitment to her radical agenda, as well as his qualifications for the job.
The outline of Ms Truss’s agenda of tax cuts and deregulation was clear within a few days of Boris Johnson firing the starting gun on a leadership contest on July 7 – at which point she was quickly joined by those who shared her views.
But Mr Fullbrook emerged as the director of a rival leadership bid by Nadhim Zahawi, before switching to Penny Mordaunt, when Mr Zahawi dropped out. It was only when Ms Mordaunt failed to make the final round that Mr Fullbrook moved over to Ms Truss’s campaign – prompting members of her inner circle to ask, albeit in hushed tones, how committed he could really be to her cause. The former head of campaigning for the party flaunted his links to Tory MPs – pointing to his role in securing endorsements from Mr Zahawi, Ms Mordaunt and several other prominent figures for Ms Truss’s campaign.
“Mark was absolutely desperate to back the winner so he jumped from Nadhim to Penny to Liz,” one Tory claimed. “I don’t understand how he got the job.”
As the backlash against Ms Truss’s Sept 23 mini-Budget became a fully fledged row, for many MPs and ministers the only visible sign of the No10 chief of staff was in WhatsApp messages he was sending with supportive images that he was encouraging them to post on Twitter.
He “ran around like a headless chicken but without the wings or the feet. It was like a carcass trying to twitch into life”, one source claimed.
The source alleged that Mr Fullbrook was rarely “in a meeting with the PM and senior Cabinet colleagues” and often not “awake early enough or up late at night enough” to influence fast-moving events.
“Senior civil servants in the building were crying out for political leadership. It was embarrassing.”
A Cabinet minister insisted, though, that in their experience Mr Fullbrook “consistently worked full pelt” in recent weeks, “was always committed and is a thoroughly decent man”. As for his lack of experience in government, “it was Liz’s choice, Liz’s decision who she wanted the chief of staff to be,” another Cabinet minister said.
“People are being unkind to Mark. During this time his father died,” the minister added. “Every chief of staff does a slightly different role.”
An ally of Mr Fullbrook said he worked “six-day weeks” during Ms Truss’s time in No10, “from 8am until late”, and described the criticism as “spiteful s---”. On the day his father died, earlier this month, he “held his hand with one hand and took urgent calls with the other”, the ally said.
Ms Truss was urged to at least bring more experienced figures into No10 to supplement Mr Fullbrook and her other advisers, many of whom were special advisers from her time at the Foreign Office or previous departments.
MPs who were passionate backers of Ms Truss’s agenda were cheered by the appointment of Matthew Sinclair, a director of the accounting giant Deloitte and veteran pro-free-markets campaigner, as chief economic adviser, along with ministerial appointments such as Jacob Rees-Mogg to run the business department and Kwasi Kwarteng as chancellor.
But one supporter added of the No10 operation: “She brought in all her spads from the Foreign Office and she was warned they knew nothing and were not experienced enough to see around the corner.”
Sir John Redwood, the former Cabinet minister was “the perfect example” of a heavyweight figure who should have had a prominent place in the Government, the source added.
Sir John had been touted for a job as a minister in the Treasury, which supporters had hoped would amount to Mr Kwarteng being assisted by an enforcer with an eye for detail and experience of driving controversial policies through the civil service. But the job was a junior post in which insiders say he would have had little influence. While challenging the economic orthodoxy entailed a sceptical approach towards the Office for Budget Responsibility (OBR), many around the Prime Minister now agree it was naive or hubristic to attempt a Budget without giving the watchdog an opportunity to produce figures on its impact on public finances.
Even backers such as Patrick Minford, the economics professor, who have railed against the OBR, said it should have been involved in the mini-Budget to give financial markets the reassurance that Ms Truss’s policies had been properly analysed. But Ms Truss believed she could weather whatever storms arose from her decision to sweep aside conventional Treasury approaches.
Ms Truss hinted that part of the reason for sacking Mr Kwarteng was that he failed to do more to lay the groundwork and reassure the markets before announcing the mini-Budget, which the Prime Minister would later claim had gone “too far, too fast”.
A senior Truss ally said some Cabinet ministers were also weak links.
“Ministers have got to supervise these things and get on top of them,” the ally said. “If you’ve got a growth strategy it should be detail, detail, detail across all the departments.”
Instead, said the source, many ministers largely left the growth strategy to Mr Kwarteng and Ms Truss.
Those who feared that Ms Truss bungled the appointments of advisers and ministers now believe those mistakes, together with the poor execution of the financial statement itself, paved the way for the collapse of her regime. Supporters of her freemarket vision fear it has now been killed off for a generation.
Mark Littlewood, director general of the Institute of Economic Affairs, a free-market think tank close to Ms Truss, said: “I’m very sorry the PM’s efforts to move the UK in a pro-growth, low-tax, pro-enterprise direction has failed. She had a difficult hand to play, but she also played the hand badly.”
Many ministers privately shared Ms Mordaunt’s analysis at Tory conference earlier this month that the Government’s communications were “s---”.
Senior ministers questioned why Ms Truss was constantly using phrases such as “growth” and “supply-side reforms” to explain her planned reforms. A Cabinet minister said the majority of the public would have no idea what was meant by supply-side reforms and that the communications experts should have been drafted in to find phrases that would explain.
Another senior minister said that, instead of repeating the phrase “supply-side reforms”, Ms Truss and Mr Kwarteng should have been talking about how the Government would remove burdens from individuals and businesses. Instead of references to “growth” the Government should have been telling voters that they wanted to make their children richer than them, the minister added. But even by the time of Ms Truss’s resignation this advice appeared to have gone unheeded.
In a paper published in August, Lord Frost, who broadly agreed with Ms Truss’s analysis of Britain’s problems, wrote: “Tackling the problems requires a robust intellectual analysis of why we are in this situation; the creation of realistic yet far-reaching policy prescriptions based on it; and effective communication of that diagnosis and that prescription.”
In a separate document prepared for a meeting with Ms Truss two days before she was announced, supportive economists warned: “To keep the markets onside, it is important that fiscal policy is explained clearly, that fiscal actions now are targeted and, further ahead, are focused on the supply side of the economy.”
After an ill-disciplined Tory conference in which Ms Truss was undermined by figures inside and outside her Cabinet, Downing Street figures also started blaming the whips.
Wendy Morton, the chief whip, was considered to have performed well as the whip for Ms Truss’s leadership campaign but allies of the Prime Minister concluded that her appointment to a government role was a mistake, even before a shambolic attempt to enforce discipline last week over a vote on fracking. Ms Moreton and Craig Whittaker were furious about No10’s handling of the vote.
But, yesterday, a close ally admitted: “No one could have prevented what happened. Liz wanted to move ahead with the mini-Budget, in the way she did, and nothing and no one could have stopped that.”
Ultimately, it was left to Ms Truss to come to the conclusion that her time was up on Thursday, rather than being advised to do so. “People around her were asking whether she wanted to carry on,” said a friend. “But she came to the decision herself.”
The friend added: “The party is ungovernable. Good luck to whoever picks this up.”
‘Mark was absolutely desperate to back the winner so he jumped from Nadhim to Penny to Liz’
‘On the day his father died, he held his head with one hand and took urgent calls with the other’