Can Rishi Sunak save the Conservative Government?

On October 25 2022 Rishi Sunak became the fifth leader of the Conservative Party since they came to power in 2010. Having lost the membership ballot in the summer, Tory MPs having seen the polls after the Mini Budget and facing the prospect of electoral annihilation, coalesced around Rishi Sunak and ensured he was the only person on the ballot. In short, MPs no longer trusted their party membership after the Liz Truss fiasco.

Following on from Party Gate, and the troubles the Conservative Party faced in 2022, Rishi Sunak will be hoping for a scandal-free year and an economy that starts to recover. It has not got off to a very good start, with Party Chair Nadhim Zahawi facing allegations of tax issues which will be investigated by the independent ethics advisor. Meanwhile, the economic outlook for Britain is weaker than expected.

When a new Prime Minister comes in and appoints a new Cabinet it is referred to as a “new government.” This wears somewhat thin when many of the “new” Cabinet Ministers have served in previous governments, many only a few weeks earlier. The likes of Michael Gove, Dominic Raab or Penny Mordant have served under previous Prime Ministers pursuing the same Conservative Party policies in Government. The Conservative Party were elected in 2019 on a Manifesto that the public expect them to implement. The accumulative issues of the last 12 years or the last 12 months have not disappeared with a change at Number 10.

25/10/2022. London, United Kingdom. Prime Minister Rishi Sunak arrives in Downing Street. Picture by Lauren Hurley / No 10 Downing Street

The Truss libertarian experiment, described by Paul Goodman editor at Conservative Home as the economic experiment, which blew the roof off the chemistry lab. The Conservatives, having learnt in 2017 that policies of austerity are electoral Kryptonite, now face the reality that small government libertarian policies much craved by many tory members, simply will not work. Sunak inherits a party bereft of ideas and vision and is now forced to increase taxes to pay down public debt and fund public services such as the NHS. Promises made in 2019 to cut taxes would have been difficult to implement before the pandemic, now they simply are not possible.

The longstanding problem with British politics, as other commentators have pointed out, there is an expectation of European levels of spending on public services, but a naive view that the country can also have American levels of taxation. This is a problem not just for the Conservative Government, but for the opposition who once in government will have the choice of increasing taxes or slashing public spending. My next blog post will address this issue further.

Brexit is adding to Britain’s economic woes. In 2021 the UK faced a 14% fall in trade with the EU. The new trade agreements have not offset this, with deals like the one signed with Singapore largely mirroring Singapore’s deal with the EU meaning no gain from leaving the single market. In the case of the Australian deal, the desire to quickly conclude negotiations resulted in terms less favourable to Britain. There is no appetite from any of the main political party’s to revisit the decision to leave the European Union and to date little evidence that another referendum would see a different outcome. However, this becomes an issue of economic management with many leading Conservative politicians having boasted that having left the EU, Britain could negotiate favourable trade deals with the rest of the world. There is little prospect of a Free Trade deal with the US and the geo-political situation means deals with China are also unlikely, and in both cases, it is unlikely any deal would be favourable to Britain. The Conservatives since 2016 have talked of the opportunities of Brexit, yet have delivered few. This may not be top of voters’ priorities right now, but certainly, for many businesses, including those who have supported and donated to the Tories in the past, this is a serious problem. This is not a problem Sunak or any Conservative leader is likely to fix without going back on earlier commitments and renegotiating terms with the EU.

The Conservative Party are the natural party of Government in Britain and is the most electorally successful party in Europe. One of their great strengths is internal unity and discipline, much more so than Labour who more often than not air their dirty laundry in public. In the last 18 months, internal infighting has dominated the Conservative Party and ground the government to a halt over the summer while they elected a new leader, only for the winner to resign and be replaced by the runner-up weeks later.

Sunak’s ascent to the top job has not reduced these internal divisions at all. The below tweet from former Minister and Conservative MP Nadine Dorries recently gives some idea of the simmering tensions within parliament:

The ‘Get Brexit Done’ coalition has fallen away with many former voters and supporters feeling disillusioned with the Tories’ performance in Government. Whereas in 2019, enough voters could get behind The Conservatives over Brexit, now there are fewer policies areas where the government have an advantage over the opposition. Attempts to attack Labour regarding recent union industrial actions have not landed so far. Many feel sympathy for striking nurses and feel health workers are not paid enough. Traditionally Rail workers get a bad rap for taking strike action without explaining their position to the public very well. RMT General Secretary Mick Lynch has been much stronger than his predecessors at making a case for his members. At the same time, with inflation above 10% many have sympathy with striking workers, and many more see the problem as poor economic management by the government even if they do not like unions going on strike. The current situation feels much more like the Ted Heath Conservative Government in 1973 than the Thatcher Government taking on the Miners Union a decade later.

It will be very difficult for the Conservative Party to win the next election. Certainly were an election held today the government will lose. But this is why there will be no election in 2023. In the best-case scenario, the economic situation is unlikely to improve until early 2024. Further to this, Sunak will want as much distance as possible from the Kwarteng Mini Budget, and this will take time. As well as an improved economy, the Tories will need to restore party unity both within their MPs and the broader party membership – who didn’t vote for Sunak.

A wedge issue, like Brexit, was in 2019, could help the Conservatives, but it is unclear what this would be. After 12 years in power, it is difficult to talk about ‘fixing the asylum system’ without it begging the question why haven’t you done so already? Slogans like a coalition of chaos about Labour and the SNP may have worked in 2015, but given the last year the Tories are in no position where they can accuse others of creating chaos. Certainly the 2017 slogan of strong and stable will not work again.

Despite everything that has happened, it would be a serious mistake to underestimate the British Conservative Party which has proven time and again to be an electoral force to be reckoned with. In England, where over 80% of British voters live, Tory is the default option in many parts of the country. The polarisation within Britain is high with tensions from the Brexit debate and ongoing calls for Scottish Independence still simmering. The Tories can certainly play these divisions to their advantage in the hope of winning support.

As the next post will discuss, Labour should be able to win the next election, but it is not a certainty yet. They have their own internal issues to resolve.

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