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14 November 2022

Rishi Sunak has been an improvement – but we shouldn’t forgive his past

The Prime Minister still won’t accept the role Brexit has played in the UK’s economic crisis.

By Martin Fletcher

For more than three years I have raged against the destruction, dishonesty and divisions visited on this country by the Conservative governments of Boris Johnson and – briefly – Liz Truss. But here’s a confession. I do not, as yet, feel the same level of anger at Rishi Sunak.

He has no mandate from the public. And he’s obviously made mistakes during his first three weeks in No 10. Restoring the odious Gavin Williamson to the cabinet was one. So was reappointing Suella Braverman six days after she was forced to resign as home secretary for leaking sensitive government documents. So was his initial refusal to attend the Cop27 climate summit in Sharm el-Sheikh, Egypt.

But let’s cut the man a little slack. When Truss resigned on 20 October Sunak was eating lunch with his daughters at a TGI Friday’s on Teesside and about to take them bowling. Five days later he was moving into No 10, having thwarted Johnson’s attempted comeback by doing a “grubby” but perhaps necessary deal with Braverman. 

That would be a tough call at any time, let alone in the middle of the UK’s worst economic crisis since the Winter of Discontent of 1978-79. A man who was a mere junior local government minister just three years ago had minimal time to prepare for an almost impossible job. Indeed he is still appointing staff.

Since then Sunak has managed to calm the markets and restore a measure of economic stability. He has brought the Office for Budget Responsibility back in from the cold. He has reinstated “Treasury orthodoxy”. He has denounced “cakeism” and “fairy-tale” economics.  

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Almost as important, he has drawn some of the heat from the toxic political debate of recent years. He is not venal like Johnson. He is not an ideological zealot like Truss. He is not an out-and-out populist, or an egregious culture warrior. He doesn’t engage in ridiculous boosterism, or practise the politics of division. 

He has brought Remainers – notably Jeremy Hunt – back into government instead of purging them. He has made a point of meeting, not goading, Scotland’s Nicola Sturgeon. He has quietly jettisoned his predecessors’ absurd plans to build a new “royal yacht”, privatise Channel 4 and move the British embassy from Tel Aviv to Jerusalem. Interestingly, he gave his first big newspaper interview not to the Daily Telegraph, the bible of the Tory right, but to the relatively centrist Times.

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Beyond the fact his wife enjoyed “non-dom” tax status for many years, his personal integrity has not been questioned. Even Angela Rayner, Labour’s often caustic deputy leader, admits he has “ethics and values”.

Sunak was an enthusiastic Brexiteer, of course, and it is too much to hope that he will admit that leaving the EU was a catastrophic mistake. But he has abandoned much of the jingoistic posturing that went with it, and is finally seeking to mend fences with European leaders instead of picking ridiculous fights with them. 

A ten-minute get-to-know-you engagement with Ursula von der Leyen, the European Commission president, in Sharm el-Sheikh lasted half an hour. In his first telephone call with France’s president, Emmanuel Macron, Sunak “just so obviously wanted to make it work, it was all a bit desperate”, a government official told Politico. He had a “very positive” first meeting with Micheál Martin, the Irish Taoiseach, before a British-Irish Council summit in Blackpool last week.

[See also: Ha-Joon Chang: “Talk of a ‘fiscal black hole’ is an insult to the concept”]

Those overtures already appear to be reaping dividends, with a new Anglo-French deal to curb Channel migrant crossings signed today (14 November), and rising hopes of an agreement to end Britain’s dangerously destabilising dispute with the EU over the Northern Ireland protocol – which puts a trade border in the Irish Sea to avoid having one on the island of Ireland.

Sunak’s biggest test will be this Thursday’s Autumn Statement (17 November). Although Hunt will deliver it, the Prime Minister has been deeply involved in its preparation. The proof will be in the pudding, of course, but the two men have been making the right noises. They admit there will be pain all round, but talk of the need for fairness and compassion, of protecting the vulnerable, of making the better off bear the heaviest burden. Judicious leaks suggest windfall energy profits, high earners, middle-class pension pots, capital gains and large inheritances will all be targeted. They promise honesty instead of Johnsonian “cakeism” or Trussian fairy-tales. 

For now, at least, they have ditched the ultras’ dream of turning Britain into a low-tax, low-regulation “Singapore-on-Thames”, and if they deliver what they promise in the Autumn Statement some of the angriest reaction may come not from the official opposition but from the Tory right.

There is one issue on which the Prime Minister is less likely to be honest, however. He and Hunt will inevitably blame Britain’s fiscal “black hole” of roughly £60bn on Covid, the Ukraine war and the country’s reckless experiment with “Trussonomics”. What Sunak will not admit is the baleful contribution to that mess of either Brexit or the reckless profligacy of the Johnson government during the years when he was chancellor.

The Brexit divorce bill alone cost £42bn. Leaving the EU will cost the UK an estimated 4 per cent of GDP in the long run, and is costing the country tens of billions of pounds a year in lost trade and taxes.

And while Sunak regularly claims credit for the £70bn furlough scheme that saved so many jobs during the Covid lockdowns, he never talks of the £37bn that Johnson’s government squandered on a near-useless test-and-trace scheme, or the £10bn spent on defective, unsuitable or overpriced personal protective equipment, or the £4.3bn lost in fraudulent Covid loans

On Sunak’s watch, spending exceeded revenue by more than £350bn in 2020, a deficit unprecedented outside wartime. The national debt reached £2trn which was, at roughly 105 per cent of GDP, the highest level since the Second World War. As I wrote in the New Statesman that November, Johnson – with Sunak’s acquiescence – “seems to have discovered a veritable forest of magic money trees. No cheque is left unsigned, no grand projet is too extravagant to embrace. He opposes tax increases. He rules out a return to austerity. He blithely promises billions here and billions there, often out of political expediency and with a cavalier disregard for the rules of accountability and the usual checks on public expenditure.”

Small wonder that Sunak joked lamely about how he wished he could “take [Johnson’s] credit card away”. Or that Kwasi Kwarteng, Truss’s chancellor, last week protested: “It wasn’t that the national debt was created by Liz Truss’s 44 days in government.” 

Britain cannot afford to have a fourth consecutive failed prime minister, so I sincerely hope that Sunak can salvage the economy. But come the next election, his role in undermining it should certainly not be forgotten.

[See also: Jeremy Hunt’s Autumn Statement was a George Osborne tribute]

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