How the Tories can survive their current crisis

“Events, dear boy, events” Harold Macmillan famously quipped when asked about a statesman’s greatest challenge. So it has turned out to be for Johnson and Sunak. The prime minister’s supporters may be forgiven for wondering how quickly the public mood has soured against the man who secured a landmark general election victory and “got Brexit done”. Similarly, admirers of the chancellor might look back to the early days of the pandemic when Sunak captured the public imagination with the furlough scheme. Erudite and thoughtful, he seemed to personify the appeal of a modern conservatism that could transcend traditional boundaries. Talk of being a leadership successor abounded. But in politics — as in life — perception matters. If allegations of an extravagant Downing Street redecoration tainted Johnson, recent revelations about the Sunak family’s tax and financial affairs have wounded the chancellor. The duo has floundered on the Kipling test, that is, being able to “walk with kings — nor lose the common touch”.

Unsurprisingly, there are likely to be vociferous calls for resignation and leadership contests. Tory backbenchers will find themselves in the spotlight, rebels will generate headlines and party whips will be on edge. The economic circumstances are perilous. The conflict in Ukraine has pushed energy prices up by more than 50 per cent with fuel poverty a real concern. Inflation is expected to cross 8 per cent in Q2 2022, its highest level in 30 years. The Office of Budget Responsibility has warned that real living standards can expect “their largest financial year fall on record”. Local elections in early May could, therefore, act as a lightning rod for voter anger.

Where are the Tories headed currently? The answer seems to be rather confused at the moment. A bid to continue to court the working class Brexiteers has seen the Tory party support greater taxation and spending policies. But the truth is that the increased borrowing cannot be sustained forever. Nor is increasing the taxation burden the answer. Incessant borrowing stands to pass debts on to the youth. Debt interest servicing stands at £83 billion — an all-time high. And increasing taxation — even to support laudable concerns such as social care — risks choking off a recovery before it has begun. The irony is that fiscal conservatism and making the case for lower taxes — especially for the low paid — has all but been forgotten by an ostensibly centre-right government. What is truly needed is not a change in leadership but a radical change in policy direction.

The government remains fortunate that the Labour party is still a work in progress. Granted that Keir Starmer cuts a more plausible figure than Jeremy Corbyn, but he hasn’t yet made a convincing pitch to centrist voters. Labour has not yet articulated a credible alternative plan. There is also merit in the argument that a prime ministerial change while a war rages in Ukraine might not be in Britain’s best interest. That said, simply carrying on with the status quo is unlikely to appease the party.

What should be Johnson’s and Sunak’s key priorities for a reset then? First, simplifying the structures of an inefficient state should be their core aim. Second, championing economic freedom and promoting innovation should be at the heart of any policy reboot. A post-Brexit Britain needs to embrace free trade and eschew protectionism. For all of Sunak’s professed conservatism, he hasn’t committed himself to any radical reshaping and simplification so far. That needs to change. Moreover, it is only through growth that Johnson’s promise to “level up” forgotten areas of the country — the so-called red wall — can be met. Importantly, the cost of transitioning to a green economy should not fall disproportionately on the least well-off. The core of this agenda would be a competitive tax regime to boost entrepreneurship and a fit-for-purpose approach to immigration. Alliances with like-minded democracies such as India will need to be cemented too. That calls for strategic nous.

None of this will be easy. But if Johnson and Sunak seek to survive “the slings and arrows of outrageous fortune” and restore political credibility, they will have to be bold. The truth remains that while Britain has a conservative administration, it still lacks truly conservative policies that are capable of promoting transformative change. That needs to shift urgently. Only then will the vision of “taking back control” have a genuine chance of being substantively fulfilled.

The writer is a London-based lawyer and political commentator