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Liz Truss’s public sector pay U-turn is a warning to her – and to the Conservatives

The Tory front-runner’s embarrassing retreat shows the danger of fixating on tax cuts and shrinking the state.

By Freddie Hayward

Liz Truss’s campaign to become Conservative leader has suffered its first major setback after she U-turned on proposals to vary public sector pay by region. The original proposals would have meant lower pay for civil servants living outside of London and the south-east of England, with an intention to eventually extend the policy to the rest of the public sector. 

It’s not surprising that plans to cut the pay of nurses who don’t live in London received widespread condemnation. Within hours of the policy being announced, Truss had disowned it. A spokesperson for Truss said: “Our hard-working front-line staff are the bedrock of society and there will be no proposal taken forward on regional pay boards for civil servants or public sector workers.”

Rishi Sunak’s campaign will be celebrating the Foreign Secretary’s blunder. They’ve quickly labelled the policy “Less under Liz” and Ben Houchen, the Conservative Tees Valley mayor and an influential voice in the party on levelling up, said he was “actually speechless”, adding, “there is simply no way you can do this without a massive pay cut for 5.5 million people including nurses, police officers and our armed forces outside London”.

Truss’s swift U-turn will limit the damage to her leadership bid. But it does call into question the political nous of those running her campaign: is it wise to adopt a policy that could be seen as cutting the pay of nurses in the Red Wall compared to those in London? Truss’s team will now be wary of proposing anything similar in future, however, and this misstep alone won’t be enough to deny her victory. But it will give hope to those in Sunak’s camp that Truss is vulnerable to mistakes that could undermine her lead.

This episode also serves as a warning to the wider Conservative Party. As I wrote in today’s Morning Call, Truss’s fixation on tax cuts and shrinking the state risks breaking up the genre-defying coalition that gave the Conservatives an 80-seat majority in 2019. Today’s events simply hint at the broader backlash that such an approach could cause. 

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[See also: Truss and Sunak’s lurch to the right jeopardises 2019 coalition]

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