Moment that mattered: Rishi Sunak becomes prime minister of the UK

The week before Rishi Sunak became prime minister, he paid a visit to Daniel Finkelstein, former adviser to Conservative leaders John Major and William Hague, at his home in Pinner, north-west London. The meeting had originally been planned to discuss what Sunak might do after losing the Conservative party leadership race in early September 2022. “By the time he came, though, it was already obvious that Liz Truss was wobbling on the throne, so we then ended up having a discussion we hadn’t anticipated,” says Finkelstein.

A few days later, on 20th October, Liz Truss stood at a custom-made Jenga block-shaped lectern to announce that she was stepping down as prime minister. During her 44-day premiership she had appointed Kwasi Kwarteng as chancellor, backed his ‘mini-budget’ of economic measures then sacked him when those measures spooked the markets and led to the pound falling to its lowest level against the dollar since 1985. The Bank of England was forced to buy billions of pounds of gilts to stop pension funds from collapsing and mortgage rates began a rapid rise which put additional financial strain on millions of Britons. Truss left the scene under a cloud of ignominy, destined, as Martyn McLaughlin memorably put it in the Scotsman, “for her rightful place as the answer to a pub quiz tiebreaker sometime in the late 2060s.”

On the night of 23rd October, Finkelstein was watching television with his wife when Times political editor Steven Swinford broke the news on Twitter that Boris Johnson had decided not to join the race to replace Truss. “I was delighted, I thought Boris Johnson’s return would have been disastrous,” says Finkelstein. Penny Mordaunt, the only remaining candidate, dropped out on 24th October and the next morning Sunak accepted King Charles’s invitation to become the second prime minister of his six-week reign.

Finkelstein was pleased to see Sunak installed at number ten. “I thought he would prove – and in my view he is proving – good at doing the job,” says the columnist. Sunak, he says, focuses on “the things that I think are important – [doing] the job diligently and concern for things that are really happening rather than just making speeches.” There was, however, a “shadow” over his new premiership and the prospects of the Tory party, cast by the fallout from Truss’s time in office. “It is understandably hard to recover from political disaster,” says Finkelstein.

Sunak played down this disaster in his first speech as prime minister, saying of Truss that “I admired her restlessness to create change. But some mistakes were made.” In the same speech he listed the challenges confronting him. “Right now our country is facing a profound economic crisis. The aftermath of Covid still lingers. Putin’s war in Ukraine has destabilised energy markets and supply chains the world over,” he said. With inflation running in double digits, real earnings falling, the Labour party more than 20 points ahead in the polls and the markets still febrile, Sunak’s new role was widely described in the press as a poisoned chalice.

Finkelstein doesn’t agree with the characterisation. “I think the position that he inherited makes it very difficult for the Conservative party to win [the next general election] and, more importantly, makes it hard for the country [today]. They’re both difficult things for him to manage. But he was totally clear-sighted about them beforehand. I know, because when he came to visit me in my kitchen in Pinner we talked about how difficult it was, but he felt that he could make a difference for the country. So I wouldn’t describe it as a poisoned chalice. He deliberately picked up the cup, but he knew what was in it.”

Labour will still be raising it in decades because it’s a brand-ruining event

In his columns in the Times in recent years, Finkelstein has often made the point that outside the Westminster bubble, most political stories don’t cut through in a lasting way to the public and influence their choice at elections. However he believes that the events of the Truss premiership have done just that.

“A huge fiasco, people will remember that,” he says. “A core of the Conservative party’s electoral appeal is that it should provide fiscally prudent, hard-headed economic management. To abandon that so publicly and with such disastrous short-term consequences… Labour will still be raising it in decades because it’s a brand-ruining event.” By way of comparison, Finkelstein cites the fact that as late as 1997 the Conservatives were still using footage of rubbish piled up in Leicester Square during the ‘winter of discontent’ of 1978-1979 to attack the Labour party.

Sunak’s appointment did not just come amid a period of economic turmoil, but also of extraordinary turnover at the top of government. In a period of just three months and 22 days, the UK had three prime ministers, four chancellors and four home secretaries. A similar level of turbulence, says Finkelstein, has not happened since 1922-1923, “when Lloyd George was removed by Conservative MPs and succeeded by Bonar Law, who got cancer and had to resign within a few months. Stanley Baldwin took over, reversed Bonar Law’s policy on tariffs and felt that he needed to call a general election, which he called and lost.”

So what can Sunak do to break the cycle of upheaval and win the next election? “In that question there is an assumption that he can do something, and I’m not sure that’s true,” says Finkelstein. “I think his focus ought to be on what he can do with the remaining period in office to make the country a better place. Fortunately, I think that is also probably the best thing [he] can do electorally.”

On 4th January 2023, Sunak outlined five priorities for the year: halving inflation, growing the economy, bringing down national debt and NHS waiting lists and stopping the ‘small boats’ of migrants and refugees. “The five points that he raised are what people want the government to do and don’t think the government will do,” says Finkelstein. “If you succeed in doing something, then it might have an electoral impact but, more importantly, it might actually make life better in this country.”

On 14th January 2023, a scandal blew up. The Sun on Sunday reported that the Conservative party chairman and minister without portfolio Nadhim Zahawi had agreed to pay several million pounds to settle a dispute with HMRC after an investigation into his sale of shares in YouGov. Zahawi, who was chancellor between July and September 2022, said the tax-collecting body had concluded that he had made “a ‘careless and not deliberate’ error” in his tax affairs. Despite coming under pressure to sack Zahawi immediately, Sunak announced on 23rd January that his independent ethics adviser Laurie Magnus would look into what had happened.

Six days later, Sunak sacked Zahawi. “Speaking for myself, I think that the right thing to do was to give Nadhim Zahawi the courtesy of an investigation into his affairs, done in the correct way, because I believe that process and institutions are a vital part of the political debate,” says Finkelstein. The wait for Magnus’s investigation “did the country no harm whatsoever, and it was considerably to our advantage to have a dispassionate, comprehensive and clear report to explain exactly what Zahawi had done to [breach] the ministerial code.” He admits, however, that “with the general public insofar as they’ve paid attention it’s made [Sunak] look a bit weak.”

Whether or not the Nadhim Zahawi affair looms large in voters’ minds at the next election, to be held no later than 24th January 2025, Sunak has a mountain to climb if he wants his premiership to last for much longer than a year. Polls in late February, taken before his agreement of a deal on the Northern Ireland protocol with the European Union, had the Labour party as much as 28 points ahead of the Tories.

“Essentially, I think if he can make the country somewhat head in the direction of more prosperity and improve the things that he wants to see improved, then there’ll be some dividend to it of some kind,” says Finkelstein. “Whether it will be remotely enough to win a general election I think is doubtful.”

Posted on Sunday, May 14th, 2023 - Categories: #49 - Oct-Dec 2022, App Issues.