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A fight for the right of the Party: Who will define Conservatism in 2022?
A fight for the right of the Party: Who will define Conservatism in 2022?

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A fight for the right of the Party: Who will define Conservatism in 2022?

The race to be the next Conservative leader – and Prime Minister – is down to its final two candidates. Both Foreign Secretary Liz Truss and Former Chancellor Rishi Sunak have been setting out their stalls and trying to woo the Conservative Party faithful before the final result is announced on 5th September.

 

The candidates’ positions on a range of issues – most notably on tax and spend – promise to take the Party in two quite different directions and define what it means to be Conservative in 2022.

Throughout the contest, many have been left wondering what can really be expected from the next iteration of Conservative government. By analysing what has been said by the candidates over the last few weeks, and their stance on policy issues during their time in government, WA’s report A fight for the right of the Party: Who will define Conservatism in 2022? unpicks what to expect from Westminster and the new Prime Minister come the autumn.

You can download the full report here:

A fight for the right of the Party: Who will define Conservatism in 2022? (PDF)

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Descent into the fire

The next in our series of insight pieces from Amy Fisher looking behind the scenes of the Conservative leadership campaigns.

As predicted this time last week, things have gotten very personal, very quickly indeed. Only Tom Tug in the debate last night really made any attempt to try to point out the circular nature of the firing squad. This was of course in the context of his own pitch as being a ‘clean start’ – which, irrespective of what happens in the next vote amongst MPs later today, already has more than a whiff of the ill-fated Theresa May’s ‘strong and stable’ slogan.

A large part of what has tipped this over into toxic warfare have been the televised debates themselves. Why any of the candidates agreed to do them is a bit baffling.

Whilst the public at large might rail against this, it’s a simple truth that until it is whittled down to the final two candidates (this week) and then the final winner (by 5th September), it’s only the MPs and Party members that really matter- in the sense it’s only they that have an actual vote in who becomes the next PM.

TV hustings also take an inordinate amount of time in preparation (not that Truss’ performance yesterday in reading her closing statement necessarily bore this out). Why haven’t the candidates instead spent their time more aggressively wooing Parliamentary colleagues?

These debates are also extraordinarily high risk – something Sunak and Truss have, belatedly realised: the next one (scheduled for Tuesday) has now been canned once they said they would not take part. How on earth did none of the advisers spot that each candidate being able ask another a question, as per last night, was going to going to be anything other than mutually assured carnage? The truth is that a lot of them are inexperienced and untested in either/both policy formation and/or campaigning. It did make for great TV though.

On the advisory front, I’ve been a little surprised by Penny’s lack of real detail on the fiscal/economic front. I would have expected her to have shown a bit more concrete thinking on the growth agenda. She’s being advised by Gerard Lyons, who at one stage was seen as a credible contender for Governor of Bank of England after Mark Carney.

I don’t wish the above to look as though I am jumping on the ‘get Penny bandwagon’. It’s just that having risen so spectacularly at the end of last week, the wheels seem to equally quickly be coming off the bus. I have to admit that I’m sceptical of over-hyping the use of ‘dark arts’. The problem with the furore about her views on trans’ rights and today’s story that she met the Muslim Council for Britain is that (a) she does seem to have previously held a position on self-identification that the Party just won’t wear, and (b) she did by her own tweet confirm she, well, met them.

So, the two “favourites” remain Rishi and Liz. There is no doubt at all that each camp will have been doing ‘due diligence’ on the other; the only question being when the material is deployed for maximum effect (read: damage).

Of course, there are some ‘true believers’ in each of the camps. But the reality is most of the Party are trying to game the least-worst option. In any number of Tory WhatsApp groups and exchanges over the weekend, the phrase ‘end of days’ is one appearing time and again. An ex-minister I spoke to over the weekend told me “Now we’ve gotten rid of Boris, none of it’s good. But it was a Hobson’s choice that he had to go”.

It was always going to be a Herculean task for the Conservatives to win a fifth term in 2024. To channel Boris, it’s a very real possibility the Party will make it a Sisyphean one by spending the summer tearing itself apart.

 

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Sunak V Truss – A Defining Contest For The Modern Conservative Party

And then there were two. In the final round of the Conservative leadership contest, Boris Johnson’s longest serving Chancellor, Rishi Sunak, faces the current Foreign Secretary, Liz Truss.

During the early phase of the Conservative leadership contest, there was a lot of talk about the need for a clean break with the past. Indeed, for one day last week at Westminster there was almost an assumption that Penny Mourdant would be the next Prime Minister. That was before her indifferent performances in the TV debates and the onslaughts from other camps, including the stridently pro-Truss Daily Mail. In the end, the MPs chose the two most experienced and best known candidates.

There is though, a significant twist. In this topsy turvy contest, Truss is running as the ‘change’ candidate even though she is the longest-serving minister in the cabinet. During a remarkable interview on the Today programme this morning, she argued that there had been a misplaced economic consensus for twenty years, thereby distancing herself from the policies of the Conservative governments since 2010. Her big pitch is for tax cuts to be implemented from “day one”. Specifically, she would reverse the National Insurance rise and the planned increases in Corporation Tax. Her belief, not widely shared amongst economists, is that such a move would trigger economic growth and avoid a recession. She also claims that the tax cuts would reduce inflation, whereas Sunak has argued repeatedly that the opposite would happen. Inflation would rise.

In fairness to Truss, she is speaking truthfully when she insists that she argued against the NI rises in cabinet last summer. She said then in private what she now declares in public, that the additional spending on the NHS or social care could be paid for by borrowing. I am told that Boris Johnson had also hoped originally to pay for his still vaguely defined social care plan without increasing taxes. In frantic meetings a year ago, Sunak insisted that if Johnson wanted the additional cash it would have to be paid for through a tax rise. Johnson agreed reluctantly. In his final Prime Minister’s Questions yesterday, Johnson could not resist a dig at ‘the Treasury’ when he told MPs that his successor should sometimes challenge that mighty department’s tight spending orthodoxies.

Johnson and his allies are out to stop Sunak. Apparently, there was talk of little else at his farewell party at Chequers on Sunday.

Yet here is another twist. In some quarters Truss is presented as the ‘Thatcherite’ candidate while Sunak is portrayed as the ‘centrist’. But Thatcher never did what Truss is pledging to do. For Thatcher tax cuts had to be paid for. It was not until 1988 that her Chancellor, Nigel Lawson, cut the top rate of income tax. She had been Prime Minister for nearly nine years by then. Truss’s approach is much closer to President Reagan’s in the 1980s. Reagan funded tax cuts from increased borrowing. In a contest largely defined by the 1980s Truss is a ‘Reaganite’.

Sunak is the Thatcherite candidate, even though some of Thatcher’s most ardent admirers in the parliamentary party are backing Truss. Like Truss he wants to implement tax cuts, but only when he has addressed inflationary pressures. This produces another oddity about the contest. Although Sunak resigned from Johnson’s government and spent a lot of his time when he was Chancellor engaged in tense disputes with Number 10, he is the one seen more widely as the ‘continuity’ candidate. This is because inevitably he is not going to disown his economic policies.

Sunak’s pitch is very different to the one that Truss is making. Already he has made clear that only he can win the next election for the Conservatives. His supporters also argue that because Truss plans to make sweeping changes she will be obliged to call an early election to secure a new mandate. Party members dread an early election. In interviews later today and in the coming days Sunak plans to argue that the Conservatives’ reputation for economic competence is the key to their appeal. If they lose that with unfunded tax cuts, they are finished for the time being.

As a result of this fundamental divide on the right of the Conservative party over when to cut taxes, there will be big consequences arising from this contest. If Truss wins, Sunak and his close supporters will struggle to support her new government’s economic plans. How can they vote for policies in the Commons when they have argued they are ‘fairytale’ tax cuts that will fuel inflation? In the longer term, I suspect Sunak would leave British politics at the next election. He would not serve in a Truss cabinet. Conversely, although throughout her career Truss has been a much more flexible politician than Sunak, it will not be easy for her and her closest allies to back Sunak’s economic policies this autumn if he wins. The leadership contest is a symptom of a division over how to achieve economic growth and there will be no resolution when a new Prime Minister is crowned in September.

There is one final twist. Both candidates seek a smaller state in theory. Yet almost certainly whoever wins will begin by spending more. To take a precise example, the hugely influential financial guru, Martin Lewis, is already calling for an emergency package this autumn when the new energy price cap is announced. The night before Sunak unveiled his most recent programme of financial assistance, he phoned Lewis to check that he was doing enough. He wanted Lewis’ backing and feared further opposition. No new Prime Minister will want to have Lewis as an enemy. There will be further help with fuel bills.

More widely the next election will be moving into view. A new Prime Minister will be in no position to cut spending on the NHS in advance, nor resist demands for increases in defence spending. There is also the thorny issue of social care. The additional spending from the NI rise is being spent largely on the NHS. How is the new Prime Minister going to find additional funds for social care or will they dump this commitment? What about ‘levelling up’, a concept that neither Sunak nor Truss is as enthusiastic about as Johnson?

The Conservatives need to retain some of those red wall seats if they are to win next time. To do so the new government will have to spend more money rather than cut departmental budgets. But for now, there is a single target audience, the party membership. Every word uttered in the next few weeks will be aimed at pleasing the members alone. They will elect the next Prime Minister.

Polls suggest Truss is well ahead. Sunak knows he has little time to sway the membership. Most are likely to vote early in the contest. He and his team plan to work around the clock for new week or so as the ballot papers are sent out. Sunak will need to be at his most persuasive. Polls on the ConservativeHome website suggest early tax cuts are the members’ top priority. Truss is pledging to give them what they want as well as delivering better public services.

When Johnson used to pledge tax cuts and higher public spending, he acknowledged he was a ‘cakeist’. He would have his cake and eat it. Such an approach was the main source of tension between Johnson and Sunak. Now Sunak must go public and put his case for what he describes as fiscal conservatism. Polls suggest he is the more popular candidate with the wider electorate. That is rarely a decisive factor in Conservative leadership contests.

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Things hot up

Former Government Special Adviser and WA’s new Director Amy Fisher shares her inside track and perspective on the Conservative leadership contest so far, as well as its wider implications for the party going forwards.

 

Dubbed a ‘wacky races’ line-up of those who’ve put themselves forward for the Conservative leadership, we will at least by the end of the day (with nominations having been made) have an idea of who actually will be in the running – and so who will need to crank up the wooing of fellow MPs over the coming days. Rishi had a good turnout for his drinks last night; one assumes he’s plenty more rose on order. He’s increasingly looking like the Djokovic of this – there may be challengers to the crown, but the favourite no doubt to make it to the last two.

So now the real trouble starts.

Since the starting gun was fired last week with Boris Johnson’s ignominious departure, things have been … brutal. The amount of briefing about, against and amongst the various ‘runners and riders’ has been vicious – and we’ve got a long, hot summer of this to go. Questions have been asked over one (not known for playing ‘nicely’ shall we say) Dom Cummings’ involvements with Rishi’s campaign; it’s somewhat irrelevant as to whether there is any kind of ‘arrangement’. Dom will do what Dom does, which is to blow everything else up so long as he gets what he wants. And a Rishi premiership seems to be it.

I’m worried by what the Party looks like at the end of this, by the time the candidates have finished taking clumps out of each other. This is personal. The last two leaderships (2016 and 2019) weren’t necessarily pretty, as such. But they were about the single issue, really, of Brexit, and to coin a phrase, who was going to get it done. This just isn’t – and with all the smears and allegations of smears already flying around, it’s somewhat ironic that this whole contest was prompted by folk’s collapse of faith in the last chap’s integrity and transparency.

The Party has always had a veering towards being its own worst enemy. I hope this batch of candidates can at least bear in mind that at the end of it all, they will need to form a Cabinet and Government of some kind of unity (not easy if you’ve spent the last eight weeks taking pot shots at each other).

However, new partnerships as the field thins out will be formed. This is where things get interesting- not least in the context of the looming 2024 GE (which CCHQ is very much focused on, and therefore so very much welcomed this leadership contest being sooner, rather than in say 6 months, time). These partnerships are make-or-break, in terms of political success and longevity. Where would Blair have been, were it not for Brown? Same question of DC without George? How each of the candidates shores up their economic offering, possibly with a running mate, will be one to watch – all of these pledges and the ones to come are after all at some point going to need properly costing.

In the last twenty years of my experience, the pendulum has tended to swing from one side to the other in terms of what the Party seems to look for in its leader. Michael Howard, safe pair of hands, DC, ‘star power’, TM back again, then Boris.

Undoubtedly what the Party, and the whole country needs, is some steady-as-she-goes form of Government, which the next few weeks most certainly are not going to be – not least if Boris, as he pledged yesterday to do, really is going to try and deliver all his manifesto commitments before he goes.

Still, by 5pm tonight, we should have a candidates’ slate that’s less like an actual cartoon.

 

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