Rishi Sunak shares first video from 10 Downing Street
Nothing is off the table as Mr Sunak and Chancellor Jeremy Hunt continue work on November’s make-or-break financial statement, which is set to include huge tax hikes and spending cuts amounting to £50billion. Downing Street has refused to rule out controversial measures, including real-terms cuts to state pensions, new taxes on workplace pension contributions or reversing planned defence spending increases.
Insiders say that Mr Sunak was appalled by the mess he inherited after becoming PM less than a week ago, while senior Tories fear that the party’s civil war could reignite over a series of “flashpoint” issues such as immigration.
Cabinet colleague Nadhim Zahawi last night urged voters to have faith in the Prime Minister, saying: “While we face difficult months ahead, we have in Rishi Sunak
the leader the country needs to steer us through”
It comes as:
- Tory MPs admitted they had “stared into the abyss” and narrowly avoided electoral oblivion;
- There was anger at “malcontents” refusing to unite behind the new PM;
- Labour seized on Treasury figures suggesting former Prime Minister Liz Truss cost the nation £73billion;
- A poll showed voters are less likely to back the Tories now Mr Sunak is PM.
Conservative MPs rallied behind Mr Sunak last night but warned the new spirit of unity could easily be shattered as the Government makes decisions on a series of divisive issues.
Rishi Sunak vows to steer UK back to prosperity
One said: “There is a degree of unanimity because we have stared into the abyss. We need to make sure that we at least give the impression of uniting.
“Everyone is talking about unity but I would watch this space. There are lots of issues that could be really big flashpoints.”
Mr Sunak and Mr Hunt have been locked in talks about the autumn financial statement, due on November 17.
There will be anger if the Government axes the pensions triple lock to allow a below-inflation increase in cash for the elderly, as appears likely.
The Prime Minister is also on course to scrap predecessor Liz Truss’ pledge to increase defence spending to three per cent of GDP, and there are fears of a return to austerity as the Government attempts to cut departmental spending.
Other areas of disagreement in the party include fracking, the topic of the Commons vote that descended into chaos two weeks ago and which put the final nail in the coffin of Ms Truss’ premiership.
Mr Sunak had vowed to end the fracking ban during summer’s Tory leadership contest but has now said it will stay after all.
The PM is also under pressure to resurrect stalled plans to send asylum-seekers to Rwanda after shocking new figures showed 38,000 people have crossed the Channel in small boats so far this year.
He also faces difficult negotiations with the EU on changes to the Northern Ireland protocol, which sets out border arrangements for Northern Ireland.
One former minister said: “There is definitely a mood to unite but issues like the triple lock and small boats must be resolved.”
Writing in the Sunday Express, Conservative Party chairman Nadhim Zahawi warned Tory MPs that continued in-fighting would hand Labour leader Keir Starmer the keys to Number 10.
He said: “My Conservative colleagues in Parliament understand the stakes are now sky-high. We cannot allow the keys of Downing Street to be handed to such an out-of-touch, self-serving group of individuals.”
Chairman Nadhim Zahawi urges the Conservative party to unite together
But he insisted: “If we come together as a party, Government and nation, we are unstoppable.”
Highlighting the scale of the challenge facing Mr Sunak, new Treasury figures suggest Ms Truss cost the country £1.6billion for every day she was in charge.
The price of her 45-day tenure in Downing Street is £73billion in lost economic growth, amounting to more than £2,500 for every household, Labour says.
An analysis of independent economic forecasts published by the Treasury in August, before she became Prime Minister, showed the economy was expected to shrink slightly in the remainder of this year, and grow by 0.5 percent in 2023.
But the latest Treasury analysis shows the economy is now forecast to shrink by 0.5 percent in the final quarter of this year, and by 0.3 percent next year.
Shadow Chancellor Rachel Reeves, who uncovered the figures, said it means the economy will be £73billion smaller than previously expected, which is £2,590 for every household in the country.
This also means around £24billion in potential tax revenue has been lost.
“The facts speak for themselves,” she said. “Mortgage costs are soaring. Borrowing costs are up. Living standards down. And we are forecast to have the lowest growth in the G7 over the next two years.”
Conservatives fear that chaos at Westminster and Ms Truss’s bungled mini-Budget in September mean they are also getting the blame for global economic turmoil connected to the Covid crisis and Russia’s invasion of Ukraine.
Some Tory MPs have defied pleas for unity by criticising Mr Sunak’s Cabinet reshuffle, which saw a number of “big beasts” from previous governments back in the Cabinet.
They include former Education Secretary Gavin Williamson, now minister without portfolio, and former International Development Secretary Andrew Mitchell, who returns to overseeing the UK aid budget in a more junior role. A Tory MP said: “You go, ‘oh, for God’s sake’. It’s the same old names.
“And when you look at the middle ministerial ranks, it’s basically Theresa May’s government – which wasn’t successful.”
And the PM is already coming under fire publicly from some Boris Johnson loyalists. Former Culture Secretary Nadine Dorries criticised Mr Sunak for his decision to stay away from the United Nations COP climate change summit in Egypt next month.
Chancellor Jeremy Hunt joins Sunak to make a financial statement plan
Meanwhile, Jake Berry, a long-time Johnson backer who served as party chairman under Ms Truss, has led attacks on Suella Braverman, the Home Secretary brought back by Mr Sunak after she resigned over an email security breach.
However, Ms Dorries and Mr Berry were dismissed by a fellow supporter of Mr Johnson, who said: “A minority only, like embittered Jake Berry who lost his job, are going to carp from the sidelines.”
Many Conservatives believe colleagues are sick of internal battles. Isle of Wight MP Bob Seeley insisted the “soap opera” inside the Tories was over, saying: “Rishi is going to lead us into the next election.”
While the PM’s focus is on the economy, he also plans to press ahead with a promised review of the EU legislation currently incorporated into UK law, with a view to eliminating remaining Brussels red tape.
Another priority is reducing the number of people classed as “economically inactive”, which means they are neither working nor looking for work, in order to help employers struggling with staff shortages.