Five things that Rishi Sunak should do before the next general election
Sitting back and hoping for the best is not an option. The Tories must attempt to do the right thing – and that might even give them a chance at the polls
Has any prime minister inherited a grislier situation? Lloyd George and Churchill took over during wars, but at least they were leading a country that understood the gravity of its predicament and was prepared to make sacrifices.
The pandemic caused a worse economic contraction than in any equivalent period during either of the wars; but, this time, hardly anyone acknowledges it.
Keir Starmer keeps repeating that our economic problems are “selfinflicted”. He does not mean that they resulted from an excessively strict lockdown. Indeed, he opposed every loosening of the restrictions and flip-flopped about reimposing them last Christmas.
No, he means that our woes were somehow caused neither by the £400billion cost of the closures nor by the Ukraine war, but by a budget announcement that was whisked away within days.
Voters show every sign of believing him. Labour is now ahead on economic competence for the first time since before the 2008 banking crisis. The electorate prefers the party on taxation, the cost of living and growth.
All this puts Rishi Sunak in an almost impossible position. The Treasury says he needs to find £50billion in tax rises, spending cuts or some combination of the two.
But, in the current mood, almost anything he does – freezing tax thresholds, ending the triple lock, cutting the defence budget, removing fuel subsidies, letting wages rise faster than benefits – will be seen as an act of cruelty rather than an adjustment to reality. He is in what chess players call a zugzwang – a position where any move makes things worse.
For that reason, the Prime Minister might be tempted to do as little as he can get away with. His whole shtick, after all, is that the grown-ups are back in charge, replacing Liz Truss’s radicalism with measured, judicious and, yes, dull policies.
The cancellation of almost the whole mini-budget, the reimposition of the fracking moratorium and the return to office of some Cameron-era ministers suggest that the Tory strategy is to be as unexciting as possible, avoid mistakes, project competence and hope that the economy turns around before 2024.
In normal times, this would be a solidly Tory approach. “If anything happens, it will be for the worse,” wrote the splendidly reactionary Marquess of Salisbury, perhaps the most conservative of all British prime ministers. “It is therefore in our interest that as little should happen as possible.”
Sadly, though, these are not normal times. To put the car in neutral and coast until the next election is itself enormously risky.
John Major’s lamentable final term is a warning of what happens when a party becomes stale after four election victories. Then, as now, voters blamed the exhausted government for every irritation. Then, as now, sleaze suddenly seemed to be everywhere – not because MPs were behaving any worse, but because the public’s patience had snapped. Then, as now, the jury was in no mood to hear a global downturn cited in mitigation.
Major kept waiting for the polls to turn, but they never did. The Tories made themselves hugely unpopular in pursuit of a balanced budget, only to hand Tony Blair a falling deficit and put Labour in office for 13 years.
Labour, needless to say, did not return the favour. As well as bequeathing an empty Treasury in 2010, it had remoulded the government in ways designed to make life harder for any Conservative successors.
The Civil Service had been rendered both more woke and less accountable. Equalities legislation politicised our standing bureaucracies. The Appellate Committee of the House of Lords – tried, effective and cheap – was replaced with a power-hungry supreme court. An uneconomic top tax rate was put in place for no other reason than to detonate in the face of any Tory leader whose priority was growth – which it duly did.
I argued last week that there should be an early dissolution, but I don’t see it happening. Both the constitutional case (all the 2019 party manifestos were rendered obsolete by Covid) and the tactical one (let’s put Starmer’s pretence that cuts can be avoided to the test) will be trumped by the desire of Tory MPs to hold on to their salaries for a few more months.
In any case, if Sunak really did plan on an early election – perhaps to coincide with the local poll on May 4, two days before the Coronation – he would be well advised to give no hint of it.
How, then, should he fill his time in office? What changes might ameliorate Britain’s situation without losing votes? How can he optimise his chances at the next election and, ideally, enact policies that would make it harder for an incoming Labour government to ruin everything? Here are five suggestions.
First, he should show that he is determined to lower the cost of living. If neither planning reform nor fracking is electorally viable, he can go for easier options.
Bringing our childcare staff ratios into line with the rest of the world, for example, would significantly reduce costs. As things stand, two working parents typically spend a third of all their post-housing income on childcare.
He could also boost family incomes by removing tariffs, which currently fall hardest on food, clothing and footwear. Our trade officials argue that unilateral tariff reduction is akin to unilateral disarmament, weakening us in trade talks. I don’t buy this argument for a moment. We have just agreed an ambitious deal on data with Singapore, which was not in the least bit weakened in those talks by having no tariffs to bargain with.
But if we absolutely must indulge this fear, then at least let’s suspend tariffs for two years, during the cost of living crisis, with an option to renew. And let’s do so across the board, including steel tariffs, which push up the cost of construction, railways, cars and electrical appliances.
Second, Sunak could push ahead with the plan for all EU laws to lapse by the end of next year unless expressly readopted. The legislation is already clunking its way through Parliament, and the PM made much of it during his summer leadership bid. One of his campaign videos promised: “In his first 100 days as prime minister, Rishi Sunak will review or repeal post-Brexit EU laws. All 2,400 of them.”
Quite apart from its economic benefits, fulfilling that pledge would put Labour on the spot. Starmer plainly wants to rejoin as much of the EU as he can, but also doesn’t want to talk about it. Why let him get away with it? Make him fight the next election promising to readopt these various rules, and see how that goes down with ex-Labour Brexiteers.
Third, set the City free to compete. One benefit of the sunset clause is that it would repeal the self-defeating bankers’ bonus cap with no fuss. Other EU financial regulations could also be scrapped without controversy. Many of them were conceived in the first place in an anti-London spirit, and imposed against UK objections. It is encouraging that Sunak has kept Andrew Griffith, a levelheaded liberaliser who had been working on reform, at the Treasury.
Fourth, secure the Union. A month ago, my sense was that the UK and the EU were groping towards a compromise on the Northern Ireland Protocol. But there is now a chance that Brussels will raise its price, reasoning that, if it can’t get concessions from Sunak, it need only wait for Starmer to get everything it wants.
Sunak should turn EU obstreperousness to his advantage, making whatever unilateral changes are necessary to guarantee the free flow of goods within the UK, and letting Starmer explain whether he would then reimpose an internal border.
Fifth, and perhaps most important, the PM should ensure that at least some illegal entrants have been deported to Rwanda before the election. People are prepared to accept a significant measure of controlled migration – but not when they see criminals making a mockery of the system. The Rwanda plan faces huge legal obstacles. And, yes, moral ones, too: no one would want to do this from first principles. But we are out of other options.
Doing these things would, at the very least, reduce the size of Labour’s majority. But, more importantly, they are the right things to do. If the Conservatives really do want to establish (or re-establish) themselves as a hardheaded, reasonable, practical party, sitting back is not an option.
How did Iain Macleod put it? “Socialists can scheme their schemes. Liberals can dream their dreams. But we in the Conservative Party have got work to do.”
Almost anything Sunak does will be seen as an act of cruelty rather than an adjustment to reality