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My most recent post discussed Liz Truss’s commitment to libertarianism and the part she played in her own downfall.

At the end, I mused whether she would still be in office were she a man. Having thought about it some more, I do believe that would have been the case. Truss has better morals than Boris Johnson and more integrity than Rishi Sunak. Furthermore, she is far more trustworthy than our de facto Prime Minister, Chancellor Jeremy Hunt. She has flaws. They have flaws.

It is curious that all of them, men, are given a pass. Truss, an honest woman, was not afforded that opportunity.

Let us look at who was out to finish Liz Truss’s premiership.

The media

During the summer Conservative Party leadership campaign, most papers — right and left — came out in favour of Rishi Sunak.

Only the Daily Mail and The Telegraph consistently supported Truss. Truss also saw The Sun as a friendly paper, particularly its political editor Harry Cole.

Broadcast media also largely favoured Sunak. Only GB News supported Truss for the most part.

Why that was is unclear.

One could point to Truss’s U-turns, evident as soon as the leadership campaign for Party members’ votes started, but most of the media — print and broadcast — were already in the tank for Sunak when Conservative MPs were still voting in July.

On November 16, veteran columnist Andrew Gimson wrote about the media outlets covering Parliament, known as the ‘lobby’: ‘Lobby journalism holds power to account. But it’s often cruel, trivial — and unfair’.

Guido Fawkes liked what he had to say:

Gimson’s article for ConservativeHome discussed the attacks on other Conservative ministers in Rishi Sunak’s Cabinet. Suella Braverman, Home Secretary once again, is one of them and Justice Secretary/Deputy Prime Minister Dominic Raab is another.

Gimson says that journalists find their witch hunts as exhiliarating as blood sports (emphases mine):

Hunting is reckoned to improve the health of the fox population.

That is not, however, why people want to hunt them. They yearn to do so because it is a wonderful, exhilarating sport.

Forget for a moment any impulse to moralise. High-minded theories are all very well. Politics as actually practised is a blood sport.

Dominic Raab, Gavin Williamson and Suella Braverman are or were the most recent quarry, closely preceded by Liz Truss and Kwasi Kwarteng, before which a blond beast rampaged across the political landscape for three years with excited members of the Westminster lobby in close pursuit.

Four of the six were hunted down, while Raab and Braverman have so far (with intermissions) survived, but might at any moment find themselves once more in mortal danger.

The lobby is trained and ready at a moment’s notice to follow any scent, no matter how faint, rival correspondents for different newspapers acting as a pack of hounds, each leaping at whichever politician is the hunted animal, drawing blood and emboldening the others to fresh frenzies of aggression …

It is impossible, if one is a lobby correspondent at Westminster, to stand aside from the full-blown crisis which rages, and any case, few experiences are more exhilarating than to be in at the death of a Prime Minister.

Every journalist, indeed everyone in the slightest bit interested in politics, will remember the first time he or she witnessed such a drama: in my case I was lucky enough in November 1990 to be in the Press Gallery to watch the fatal resignation speech delivered by Sir Geoffrey Howe, and 19 days later was in the crammed Committee Corridor on the evening it was announced amid almost unbearable excitement that Margaret Thatcher had fallen four votes – four votes! – short of beating Michael Heseltine by the necessary margin in the first round.

Such crises becomes all-consuming. You surrender yourself to the experience, and nothing else seems to matter. If you are a reporter, your news editor and editor demand constant reports from the front, and you want to distinguish yourself by revealing dramatic new charges, whether solid or flimsy, against the embattled minister, rather than just repeating what your rivals have said.

Such work requires the ruthless expertise to spot in an instant the two or three words in some dreary speech or answer which can be held to constitute a new development. The lobby are brilliant at this: they see the new angle, the incriminating admission, where a normal person would notice nothing.

News becomes an artificial commodity, an esoteric language only comprehensible to highly intelligent and practised correspondents, who translate it into the latest thrilling episode of a story which is intelligible to the dimmest of us, for it is as old as history: will the ruler live or die?

This question of life and death simplifies everything, and lends it a personal flavour. Does one like the look of whichever minister is just then being hunted, and hope he or she will get away? Or would one much rather see him or her bumped off?

The tyranny of the story extends to the comment pages. Leading articles and columns are written for or against the hunted person, most likely against, for it is much easier to write a vivid piece denouncing a politician for being disreputable than to compose a vivid defence.

In order to purify public life, the offending minister must be drummed out of it. Nothing which might serve this noble end is too cruel to be said; too piffling to be taken down and repeated.

Let the victim and his or her family cope as best they can. It would be wrong to spare them the full blast of public disgust. We find ourselves in a primitive world where human sacrifice is demanded; not in a rational one where events can be weighed and assigned their due importance, or unimportance

There is a deep satisfaction to be derived from getting rid of a Prime Minister, so deep that we have in recent years got rid of three. For a short time, very short in the case of Liz Truss, we allow them to triumph, before restoring equality, for which all democracies have a deep yearning, by dragging them down with brutal abruptness to our own level …

What the lobby does, or helps Conservative politicians to do, is the modern version of an ancient and savage tradition. All else is forgotten while the tribe slays its chief.

And no tribe is better at slaying its chiefs than the Conservative Party.

Afterwards, some enemies of the prey express their empathy for the slain, such as Jenny Murray did for Truss on October 27 in The Mail. Murray’s headline read ‘I never expected to feel sorry for Liz Truss’ and, upon closer inspection, she doesn’t really feel sorry at all. She uses the piece to lick her own wounds after retiring from the BBC at the age of 70:

I was not sorry to see her go. Her short time in power was a disaster.

I’d known her professionally for a good few years and had often found her a bit weird with her oddly truncated speech patterns, bizarre facial expressions and apparent lack of emotional intelligence. She was no public speaker and I certainly never saw her as Prime Ministerial material.

In that I was right, but despite her self-serving, unapologetic final speech and her typically arrogant and selfish, ‘Well at least I’ve been Prime Minister!’ goodbye, I can’t help sympathising with what she has to face next.

As an ordinary constituency MP, she’ll join what I have dubbed, from bitter personal experience, the ‘Once I Was Hot, But Now I’m Not,’ club. I know she’ll be asking herself, ‘Who am I now?’

It’s two years since I left the job that defined me for 33 years. I was Jenni Murray, presenter of Radio 4’s Woman’s Hour.

It had been my greatest ambition since childhood. I’d presented Newsnight and Today, but the moment I heard the announcer first say on Monday, September 14, 1987, ‘And now Woman’s Hour, with Jenni Murray’ remains the most thrilling of my life.

I loved every minute of those 33 years and, unlike Liz Truss, I was not forced out of my position (though even when you leave a top job of your own volition, it doesn’t stop others speculating). I made the choice to leave as my 70th birthday came and went.

So, nothing like Liz Truss after all. The rest of Murray’s lengthy column is all about herself. Sickening.

On a positive note, I was surprised to read that Andrew Neil, normally a supporter of the status quo, supported Truss and Kwarteng’s mini-budget just after it was announced in Parliament:

After 12 years of Tory government we finally get a Tory budget. Yesterday’s not-so-mini-budget was a watershed event, taking the country in a new economic direction and creating clear blue water between government and opposition.

The Tory faithful couldn’t quite believe it. Labour struggled to grapple with its implications. The political dividing lines will now be starker and fiercer than they’ve been for a generation.

No more tax rises by stealth (or, more recently, in plain sight). Or endless, futile tinkering with the minutiae of spending and taxation to give voters a false impression of constructive activity. Or the relentless doling out of taxpayers’ dosh to whatever fashionable vested interests managed to catch ministers’ attention.

Instead, Prime Minister Liz Truss and her Chancellor, Kwasi Kwarteng, junked all of that in favour of one overriding economic priority: higher economic growth. Many of the verities of Britain’s economic establishment have been slaughtered in the process

Scrapping next April’s planned rise in corporation tax (on businesses’ profits) won’t win any popularity contests outside company boardrooms. But an essential part of Britain’s post-Brexit future is surely to be a magnet for foreign investment. Whacking up the country’s key business tax was a strange way of going about it

New ways require new justifications. The Treasury estimates that abolishing the 45 per cent top rate of income tax will cost £2 billion a year.

This is a typically static official calculation. If it results in more top earners declaring their income in Britain, then it could soon more than pay for itself.

Ditto bankers’ bonuses. The cap is a relic of EU regulation. Banks simply increased pay to compensate for reduced bonuses, thereby making their compensation costs more fixed and less flexible.

Frankfurt, Paris and Amsterdam have tried hard to lure our financial services away from the City since Brexit, with only limited success. Bonuses in those centres are still capped. London now has the advantage.

And, remember, with the new top rate of tax at an internationally competitive 40 per cent, every £1 million banker’s bonus is £400,000 more for schools and hospitals

for more than a decade now I’ve watched chancellors take tough, painful decisions on tax and spending based on OBR borrowing forecasts that turned out to be huge over-estimates, so much so that in retrospect neither the tax rises nor spending cuts were necessary.

Indeed, as Truss attempts to take the country in a new, less orthodox direction, I’d argue that it’s a blessing that she’s been able to do so unencumbered by the OBR’s dubious forecasting.

We’ll get the OBR’s latest workings in two months anyway, when it might have a better idea of what 2023 will look like. Nor are we entirely in the dark. The Treasury says the tax cuts and energy price cap measures will increase borrowing this year from £162 billion to £234 billion — an extra £72 billion.

The IFS thinks we’ll still be borrowing £100 billion a year through the middle years of the decade.

These figures have spooked the markets. The pound continued its decline against the dollar after Kwarteng’s statement and the yield (or interest rate) on short-term government debt rose to close to 4 per cent, making it a lot more expensive to borrow than only two years ago, when it was 0.4 per cent.

These are real constraints on the Government’s ability to borrow even more. A falling pound merely fuels inflation, especially when it comes to imported energy, which is priced in dollars.

Interest rates are already rising. If excessive government borrowing forces them even higher, that will merely choke off the economic growth the Government so desperately seeks.

There’s another factor at work here. The global currency and debt markets have had a ‘down’ on Britain for some time. It’s not clear why. Britain’s debt-to-GDP ratio is among the lowest in the G7 club of big economies. Our budget deficit is on a par with many other major economies. Economic growth is anaemic — as it is everywhere, from the Eurozone to America to China.

I suspect it’s a Brexit hangover. The publications global market players read most closely include the New York Times, the Economist, the Financial Times and leading European papers such as Le Monde and the Frankfurter Allgemeine Zeitung. All — and others like them — have been relentlessly negative about Britain since the 2016 referendum

It is said she’s taking a great gamble. That’s true. But sticking with the failed policies of the recent past was probably an even a bigger gamble. The stakes are certainly high.

If by this time next year the economy is still in the doldrums, then it’s not just Truss who will be finished. So will any prospect of the Tories winning the next election.

Read it and weep. We are back to square one.

There is much that the media didn’t tell us about the global picture of economic pandemonium.

Early in the week following Kwarteng’s mini-budget, US mortgage rates went up to 7%:

The EU’s average deficit is worse than the UK’s:

https://image.vuukle.com/9b30bb2c-838f-44c2-bf35-a8380d75711b-80a8ed1b-f697-4bc1-bc25-d18521aa563f

At the end of October, by which time Truss had gone, inflation in the Euro zone increased to 10.7% as growth slowed:

At the beginning of November, a Fed hike caused sterling to trade below £1.13 against the dollar:

And, finally, within three weeks of becoming Prime Minister, Rishi Sunak made new spending commitments, pledging billions to the world. This graphic appeared on November 7:

https://image.vuukle.com/afdabdfb-de55-452b-b000-43e4d45f1094-6f3d3b31-5e82-478e-b97c-3802370621e8

Objection from the media came none.

Conservative MPs

On October 20, in the immediate aftermath of Truss’s stoic resignation, The Sun gave us the reaction from three Conservative MPs:

Responding to today’s bombshell announcement, former minister and Red Wall poster boy Neil O’Brien tweeted: “The next PM must return to the national conservatism represented by our election winning 2019 manifesto and put us back on the side of normal working people.”

If anyone was going to have done that, it would have been Truss, for whom Party members voted in the majority. Sunak and Hunt certainly aren’t on the side of ‘normal working people’: tax ’em until the pips squeak.

Next up was Steve Baker, now an apologetic Northern Ireland Minister:

Brexit hardman Steve Baker urged colleagues that whatever the result, “we must accept and back the new Prime Minister”.

Millions of us wish he had shown the same allegiance towards Truss.

The only one to say anything complimentary was Greg Hands, who served as an International Trade Minister:

He said:

A dignified exit as Prime Minister from Liz Truss. A difficult day for the country, the Party and for Liz personally.

She wasn’t long as PM, but served at the Cabinet table longer than any of her three predecessors. She has long served the country – and I wish her very well.

At least Truss wasn’t removed from the top table Chinese-style:

On October 27, one week after Truss’s resignation, The Telegraph‘s Matthew Lynn said that backbench Conservatives just could not bring themselves to support Truss’s economic plan, which Kwasi Kwarteng fronted.

In other words, Conservative MPs shy away from libertarianism, even though I think it would do the UK a lot of good:

The timing, to put it mildly, was unfortunate. It was a difficult transformation to pull off at the best of times, but against the backdrop of rising inflation and an out-of-control dollar, it was doubly difficult. 

Truss’s programme did not have the necessary support within the Parliamentary Conservative Party either. Massive opposition from Labour, the Scottish Nationalists, and the Twitter mob was to be expected. 

But very few MPs were willing to support the plan, and without that backing it was always going to be hard to push through. Even before it got on to the genuinely difficult stuff – investment zones, planning reform, the green belt – the opposition was overwhelming. 

The Bank of England

Matthew Lynn points the finger of blame at the Bank of England (BoE):

the real failure of Trussonmics may well have been the fault of the Bank of England. As Narayana Kocherlakota, a former President of the Minneapolis Fed, and now Professor of Economics at New York’s Rochester University, argued in an opinion piece for Bloomberg this week, it was the Bank’s failure to support the gilt market that killed the plan

“The way the Truss government collapsed should concern all who support democracy,” he warned. 

In his Bloomberg article of October 26, Narayana Kocherlakota defended Truss and criticised the BoE:

Markets didn’t oust Truss, the Bank of England did — through poor financial regulation and highly subjective crisis management.

Truss won the leadership of the Conservative Party, which the UK electorate had voted into power, by promising a range of deep tax cuts and government spending increases. Whatever one might think of her policies, they were her mandate. I agree with the many observers who expected them to lead to higher inflation, higher interest rates and quite possibly higher unemployment. But such adverse outcomes take months and years to play out. Her government fell in a matter of weeks. How could this happen?

The common wisdom is that financial markets “punished” Truss’s government for its fiscal profligacy. But the chastisement was far from universal. Over the three days starting Sept. 23, when the Truss government announced its mini-budget, the pound fell by 2.2% relative to the euro, and the FTSE 100 stock index declined by 2.2% — notable movements, but hardly enough to bring a government to its knees.

The big change came in the price of 30-year UK government bonds, also known as gilts, which experienced a shocking 23% drop. Most of this decline had nothing to do with rational investors revising their beliefs about the UK’s long-run prospects. Rather, it stemmed from financial regulators’ failure to limit leverage in UK pension funds. These funds had bought long-term gilts with borrowed money and entered derivative contracts to the same effect — positions that generated huge collateral demands when prices fell and yields rose. To raise the necessary cash, they had to sell more gilts, creating a doom loop in which declining prices and forced selling compounded one another.

The Bank of England, as the entity responsible for overseeing the financial system, bears at least part of the blame for this catastrophe. As a result of its regulatory failure, it was forced into an emergency intervention, buying gilts to put a floor on prices. But it refused to extend its support beyond Oct. 14 — even though its purchases of long-term government bonds were fully indemnified by the Treasury. It’s hard to see how that decision aligned with the central bank’s financial-stability mandate, and easy to see how it contributed to the government’s demise.

The way the Truss government collapsed should concern all who support democracy. The prime minister was seeking to fulfill her campaign promises. She was thwarted not by markets, but by a hole in financial regulation — a hole that the Bank of England proved strangely unwilling to plug.

Two days before Truss resigned, Daniel Lacalle wrote an article for Mises Wire: ‘The Bank of England Made Liz Truss a Scapegoat’.

Lacalle points out that economic turmoil was worldwide, something not reported widely in the British media. No surprise there:

I find it astonishing that not one of the so-called experts that have immediately placed the cause of the British market volatility on Liz Truss’s budget have said anything about the collapse of the yen and the need for Bank of Japan intervention, which has been ongoing for two weeks.

Why did so many people assume the Truss minibudget was the cause of volatility when the euro, the yen, the Norwegian krone, and most emerging market currencies have suffered a similar or worse depreciation versus the US dollar this year? What about the bond market? This is the worst year since 1931 for bonds all over the world, and the collapse in prices of sovereign and private bonds in developed and emerging market economies is strikingly similar as those of the UK fixed income peers.

He blames British pension funds’ liability-driven investing (LDI) strategies on the abuse of quantitative easing (QE) over the years. Who was in charge of that? The BoE.

Lacalle wrote while Truss was still Prime Minister:

British pension funds are not selling sovereign bonds because of lack of trust in this or another government’s budget. They are selling negative-yielding sovereign bonds because they jumped wholeheartedly into the debt bubble created by artificially cheap money believing that central banks would keep fixed income prices elevated with constant repurchases.

British pension funds’ unfunded liabilities are not a problem caused by the mini budget nor solely a UK problem. It was an enormous problem in 2019–20 disguised by insane currency printing. Unfunded global liabilities for state pension funds in the US were already $783 billion in 2021 and rose to $1.3 trillion in 2022 according to Reason Foundation. The funded ratio of state pensions was just 85 percent in 2021 and has fallen below 75 percent in 2022.

What happened in the years of negative rates and massive currency printing? Pension funds used liability-driven investing (LDI) strategies. Most LDI mandates used derivatives to hedge inflation and interest rate risk. And what happens when inflation kicks in and rates rise? “As interest rates have risen, the notional value of some of the derivatives held in LDI portfolios has fallen. The result: increased collateral calls. The speed at which rates have risen means some pension plans have had to liquidate portfolios to meet collateral calls” according to the Investment Association’s latest report in September and Brian Croce at Pensions and Investment.

The total assets in LDI strategies almost quadrupled to £1.6 trillion ($1.8 trillion) in the ten years through 2021. Nearly two-thirds of Britain’s defined benefit pension schemes use LDI funds, according to TPR and Reuters. Liz Truss and Kwasi Kwarteng are not to blame for this insanity. The policy of negative real rates and massive liquidity injection of the Bank of England is. Kwarteng and Truss are only to blame for believing that the party of policies of spending and printing defended by almost all mainstream Keynesian economists should work even when the music stopped

Liz Truss and Kwasi Kwarteng are not to blame for the insanity of the past years or Rishi Sunak’s ultra-Keynesian budgets. They are only to blame for believing that another dose of Keynesian deficit insanity would not harm.

Mr. Kwarteng’s demise is just a casualty delivered by the modern monetary theory crowd and the monetary laughing gas city to justify that the problem was a ludicrous tax cut not years of currency printing and deficit increases.

What has happened in the UK or Japan is likely to happen soon in the eurozone, which accumulated more than twelve billion euro of negative-yielding bonds in the years of cheap money and reckless stimulus plans.

Liz Truss is not to blame for twenty years of monetary insanity and fiscal irresponsibility. She is to blame for a budget that increases spending without cutting unnecessary expenses.

The irony of it all is that the defenders of monster deficits and borrowing if it comes from bloating the size of government feel vindicated. It was the evil tax cuts!

The political analysis of the mini budget is astonishing. No one in the UK parliament sees any need to cut spending it seems, yet those expenses are consolidated and annualized, which means that any change in the economic cycle leads to larger fiscal imbalances as receipts are cyclical and, with it, more currency printing. The assumption that raising taxes will generate perennial annual increases in receipts no matter what happens to the economic cycle can only be defended by a bureaucrat.

Well, Rishi Sunak and Jeremy Hunt are those bureaucrats.

There are global players in pension fund management, BlackRock being one of them, as The Conservative Woman revealed on October 27:

BlackRock is heavily involved in the charity sector, managing over £4.5billion for more than 3,000 UK charities alone. ‘Sustainability’, food security and renewable energy rank very highly in their priorities in that sector.

The role of BlackRock in the recent selling off of derivatives by UK pension funds, said to be behind the triggering of a fall in sterling following the ill-fated Kwasi Kwarteng mini-Budget, is an intriguing one. BlackRock executives would defend their actions by stating they were merely protecting clients who were financially overcommitted in that sector and that pension fund managers ought to have known the risks involved in leveraged investment strategies in the first place, and that there is far more to that type of riskier investment than just following trends. Either way the political fallout was profound, triggering a chain of events which led to the fall of Prime Minister Liz Truss. BlackRock executive defends pensions strategy that fuelled UK crisis

Interestingly, Jeremy Hunt has appointed a BlackRock executive who is pro-Net Zero and anti-Brexit as one of his chief advisers:

A business with the financial resources of BlackRock will naturally attract well-connected people to its payroll. People such as Rupert Harrison, chief of staff to Chancellor George Osborne from 2006 to 2015. An opponent of Brexit, he tweeted in July 2017 that ‘the rest of Europe is booming and we’re not’.

Intriguingly, Harrison is now one of new Chancellor Jeremy Hunt’s most senior advisers. On the surface, Hunt seemed to have been parachuted in from nowhere, having failed in two leadership elections and spending more than two years on the back benches, yet from the moment he was appointed he already had a highly expert team, including Harrison, ready to start at once and acting promptly with great self-assurance as though he knew he already had the backing of those who really matter.

However, Conservative Party members are unhappy with Hunt and Sunak’s economic policy based on higher taxes, which are, in reality, much higher than they read on paper. This poll is from November 29:

Guido Fawkes wrote (emphases his):

The Tory membership doesn’t support their own government’s economic policy, according to the latest Conservative Home panel poll. Opposition stands at 48.78% and support at 41.87%. 9.35% don’t know. 

It can’t come as much surprise. As Rishi’s supporters point out, he was warning of the consequences of Liz Truss’s policies during the summer contest, and the membership still voted for Liz’s low tax package. Support at 41.87 is actually 0.8% lower than Rishi received from the members during the summer…

Let us return to the BoE.

In the December 2022/January 2023 issue of The Critic, Jon Moynihan published ‘How the Bank broke the Government’, which refers to Narayana Kocherlakota’s aforementioned article for Bloomberg and expands on the use of LDIs in pension fund management:

Kocherlakota’s view was that the Bank of England was responsible for the crisis, through “poor financial regulation and highly subjective crisis management”. Outside the UK chatterati, this view is widely supported.

The beef against the mini-budget was that it spooked the market. But virtually all of the policy announcements made by Kwasi Kwarteng on the day were not new; they had been pledged during the Truss campaign or — in the case of the energy price guarantee — confirmed shortly after her arrival in Downing Street

Sure, the mini-budget stated that clarifying how all the spending/lowered tax revenue would be paid for was to be put off until the later financial statement, due some weeks later. But the only new thing was the change to the top rate of income tax from 45 per cent to 40 per cent

Given the well-known dynamic impact of lowered tax rates, this change would arguably have been revenue neutral or even beneficial; even without any dynamic benefit, it could have cost at most £2 billion in tax revenue. That is a rounding error compared to the amounts already absorbed by the market and a fraction of the costs Rishi Sunak has accepted at COP 27 — to which the markets have reacted entirely complacently. It is just not credible to blame the mini-budget for the market turmoil.

Moynihan explains more about how LDIs work:

The prime obligation of a pension fund is to match its assets (the money it uses to make payments) to its liabilities (the payments it expects make to its pensioners over the years). For a fund to be as sure as it can that it will be able to pay its future pension liabilities, it buys assets whose coupons and maturity match its (actuarially expected) future pension payments.

So far, all well and good. The problem is with LDI funds. These, like so many pension funds these days, use gilts to accomplish that matching (in a popular meme of the past couple of decades, “gentlemen prefer bonds”). However, in addition the idea has been sold that they can goose up their returns a bit, to compensate for the low yields they are getting on their gilts

This little bit of extra profit is accomplished by borrowing some further money, short-term, and with it buying long, higher-yielding assets — either real assets, or derivatives. It’s a well-known and always risky bet on interest rate movements; in some markets it’s known as the “Carry Trade”; in the Japanese markets it’s known as the “Widow Maker”. It’s entirely inappropriate for “safe” pension funds. 

If rates move against the bet, the bet sours. To cover the risk they are taking, the funds are required to give over their other assets (the gilts) as collateral to the bank that lent them the money. 

When the bet sours, the bank that lent them the money “calls the collateral”, selling off the gilts in order to repay the borrowing a wave of such sales can destabilise the gilts market and create a disorderly environment, as happened in late September 2022.

Some would say that the Bank of England should have known all of this and not allowed such risk to be taken by this huge market in LDI funds. Some would raise an eyebrow at the news that until the middle of 2022, the Bank of England itself held 100 per cent of its £5 billion pension fund in just one single LDI Fund, and therefore blithely seemed to believe it was OK for such risks to be taken (their 100 per cent recently was reduced to a scarcely less concerning 82 per cent).

For whatever reason, the Bank and other regulators did allow LDI funds to become more and more the fashionThe total value of liabilities hedged with LDI strategies was $1.8 trillion in 2021, around half of the total of LDI funds in the world, a sure sign that the Bank Of England had been far too lenient in allowing LDIs to flourish in the UK. That is Strike One.

Why then did the LDI funds start collapsing specifically in late September? It starts with the rapid appearance this year of inflation, caused in no small part — as the Bank has finally admitted — by the bank’s excessive growth of the money supply in recent years. As inflation consequently shot up, so, all year, did gilt yields rise, putting increasing pressure on those rickety LDI funds. That is Strike Two against the BoE for its role in worsening inflation in the UK, leading to this instability.

Two days before Kwarteng delivered his mini-budget, Saxo Bank and Deutsche Bank correctly predicted a fall in sterling.

Saxo predicted:

“If the BoE fails to hike 75 basis points, let’s shield our eyes for what is going to happen to the pound here.” (They were predicting a fall in sterling, which duly happened. Low sterling leads to higher inflation leads to higher gilt yields.) 

Deutsche Bank said that the BoE needed a ‘hawkish response’. It never materialised.

In the end:

Both Deutsche and Saxo were right. Only days after the Bank failed to step up to the 75 basis points mark, sterling momentarily dropped to $1.04, just as Deutsche had predictedyet for reasons that remain to be explained, the drop was blamed on the mini-budget, not on the Bank’s failure to sufficiently raise rates. The failure to raise rates enough, two days before the mini-budget, is Strike Three.

In addition, the BoE announced a fortnight-long programme of selling £40 billion of gilts, which ended in mid-October.

In other words, it moved from QE to QT, quantitative tightening.

Reuters noted the BoE was the first central bank to do that, at least in recent years. Bloomberg called the move ‘historic’ for the same reason:

In 2013, all it had taken was the Fed to announce it was doing less QE — not stopping, just doing less — for the markets to go into a “Taper Tantrum”.

Ever since, most central banks have been cautious not to move too fast in shutting down their QE. But not the BoE. Why did it see itself as in a position to be the first in the world to take this very risky step, aware as they were that the mini-budget was about to be announced?

Not surprisingly, the markets responded:

market participants move fast to get ahead: they quickly sell their own bonds before their value is hammered by the BoE sales. Yields immediately go up and the price of bonds immediately falls. Which is why it was — Strike Fourstupid for the central bank to announce its moves ahead of time: it’s like the time that Gordon Brown announced he was selling all our gold, and the price collapsed so he made much less from the sale. But now the LDI pension funds started to get really hammered: as the market moved to dump gilts, the price of gilts fell and fell — this is still before the mini-budget — and collateral calls began to come thick and fast on the LDI funds.

The doom loop began:

And even more collateral calls then came in, and we were in an accelerating doom loop. All this was happening as the mini-budget was announced, and the lazy financial press, not seeing what had happened earlier, blamed the rout in the gilts market on the mini-budget. But it was started by the Bank of England’s earlier decision to go full tonto QT. Strike Five.

Cue the headlines that Liz Truss ‘crashed the economy’, to borrow Labour’s words, which they are still using in Parliament:

The Prime Minister is accused the following day of destroying the economy.

The BoE backtracked immediately, announcing it would move from QT back to QE:

The Bank of England, of course, immediately announces that it is not after all going to sell £40 billion of gilts — it is going to buy £60 billion of them — back from QT to QE in a blink of the eye. 

Of course, by then, it was too late for Truss and Kwarteng. Their collective goose was well and truly cooked:

… by now the gods of havoc have been unleashed. Truss’s enemies in the Conservative party get to work, using the mini-budget narrative to undo the mini-budget, to oust the Chancellor, and finally to oust the Prime Minister herself. Job Done

The BoE defended its actions:

The post-mortem speech by the Bank’s director for financial stability, entitled “Risks from leverage: how did a small corner of the financial industry threaten financial stability?” makes for interesting reading; in this telling, the Bank staved off a crisis from what, for anyone, would have been an unexpected direction, dealing more than adequately with the non-bank sector. If anything, the director claims, the UK was ahead of the curve!

As for the current Sunak-Hunt government, Jon Moynihan has also noted the presence of David Cameron’s Chancellor and the former BlackRock executive:

George Osborne and Rupert Harrison, late of BlackRock, the UK’s second largest provider of LDI funds, are now advising the new government.

Moynihan ends his article by pointing out that the BoE’s governor, Andrew Bailey, has the nickname of ‘Lullaby’ because he tended to doze off during meetings in a prior position:

As head of the Financial Conduct Authority from 2016 to 2020, he saw first-hand the sort of shenanigans firms and funds will get up to if, pressed by smooth talking salesmen, they are given the freedom to act as they will.

It has been alleged that while in that role, Bailey “dozed off” during meetings over a pensions scandal. Now, the organisation he runs is accused of being asleep at the wheel on LDI pension funds, not to mention on inflation, the currency, the stability of markets.

It looks like the BoE’s laxity led to the fall of a government:

All that led to the end of a government, in a way that will continue to reverberate, to the detriment of many people’s view of democracy in this country, for decades to come.

What the British think

Only last week, on November 23, IPSOS published a poll saying that politicians are the least trustworthy of working Britons. Pictured alongside Rishi is a very young Piers Morgan when he edited The Mirror. Journalists have a trustworthiness rating of 29%, compared to politicians in general at 12%:

Guido has the full chart of occupations participants were asked to rank in order of trustworthiness:

Hardly unsurprisingly, public trust in politicians to tell the truth has fallen to its lowest level ever, according to the latest Ipsos poll. Just 12% of the public now trusts politicians to tell the truth, lower than advertising executives (14%) and government ministers (16%).

Unfortunately for journalists they don’t fare much better, at just 29% – one percent above estate agents…

Nurses and doctors ranked the highest at 89% and 85%, respectively.

Television news readers ranked at 58%, above clergy/priests and the man in the street, both of which tied on 55%.

Conclusion

On November 22, roughly one month after Truss resigned, Dan Wootton did a follow up on GB News.

Nigel Farage told him:

Hunt was the coup. Sunak is little more than a puppet.

Wootton also interviewed Ranil Jayawardena, who served as Secretary of State for DEFRA, the Department of Environment, Food and Rural Affairs. He was very gracious and didn’t want to get into any controversies. Wootton, who was a big Truss supporter, wanted to know how both of them were faring. He said that they were fine.

I’m including the nine-minute interview here just so you can hear Ranil Jayawardena’s voice. He should record audio books in his retirement. Someone in the comments to the video said that he sounds like Boris. He sounds a thousand times better than Boris. This is received pronunciation, rarely heard today in such mellifluous tones:

The Liz Truss saga ends here.

I fear the worst, for the Conservative Party and for the British.

End of series

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My most recent post on Liz Truss explored the background to her final week in office as Conservative Party leader for 44 days.

She remained Prime Minister until Rishi Sunak took over and was in post for 50 days.

The book

On Thursday, November 24, 2022, Out of the Blue, the biography of Liz Truss by The Sun‘s Harry Cole (right) and The Spectator‘s James Heale (left), went on sale:

They had to frantically rewrite parts of it and add the sad denouement:

The Guardian‘s Gaby Hinsliff gave it a good review, considering that The Sun and The Spectator are not aligned with the paper’s politics:

More excerpts from Hinsliff’s review follow (emphases mine):

Liz Truss was also the first [Prime Minister] to unravel almost faster than a biographer can type. She quit eight days before the Sun’s political editor Harry Cole and Spectator diarist James Heale were due to deliver a portrait already being written at breakneck speed, and for a book to emerge at all in the circumstances arguably represents something of a heroic technical achievement. True, the writing is clunky in places. But nobody is going to be buying this book for its literary elegance; the point is to rubberneck at what remains of the crash site, and if that isn’t what Cole, Heale or most of their interviewees originally intended to deliver – well, life comes at you fast in British politics nowadays.

Then comes the bit in the tweet about the book being of two parts.

The review introduces tantalizing details into Liz’s life, past and present, that are in the book:

Most of the clues as to what went wrong however lie in the first part, a very readable gallop through Truss’s childhood as the daughter of Guardian-reading, mildly eccentric leftwing parents, via her political awakening at university – first as a free market Lib Dem, then as libertarian Conservativeright the way through to her stint as foreign secretary, careering round the world in pursuit of the perfect Instagram shot. (It was during this stage that her ministerial “rider” was said to include multiple espressos in a flat white-sized cup and a bottle of sauvignon blanc chilling at every overnight stay.)

I was intrigued by Truss’s mother, Priscilla, who briefly moved to eastern Europe in the 1970s to “try out life under the communists”, took her children on Greenham Common protests and made herself a bright yellow banana costume in which to promote fair trade back home in Leeds. When Truss recalls schoolmates shouting “saw your mum in Tesco’s dressed as a banana again”, other 70s children of free-thinking parents may understand her seeming obliviousness to criticism a little better. You don’t grow up with a banana-clad mother, I suspect, without developing a certain sturdiness.

The book shows Truss’s self-belief from the time she entered Parliament in 2010, when David Cameron became Prime Minister:

Obliviousness isn’t always a blessing in politics however, as becomes clear in her first job as early years minister under David Cameron. Truss had hatched a plan to cut childcare costs by slashing the number of adults required to supervise children, which unsurprisingly proved controversial. Instead of patiently trying to build public and political support for it, she simply put her head down and charged – much as she would a decade later with her mini-budget, and about as successfully. All young politicians make mistakes. What’s unusual about Truss is that the lesson she seemingly took from hers was to believe in herself even more, and listen to others even less

But it’s perhaps significant too that she had got away with so much in the past, leading to an overconfidence about her ability to wing it – as she did even in the early days of her leadership campaign.

Interestingly, a Conservative plan to expand the number of adults who can care for children was debated earlier this month. It would allow people to mind children in their own homes rather than at a day care centre.

As with anyone else, there are darker sides to Truss, most of which will never be fully known. Cole and Heale were unable to interview her a third time for the book:

The authors recount sympathetically the well-trodden story of how an earlier extramarital affair with the married former Tory MP Mark Field nearly wrecked Truss’s search for a parliamentary seat, rightly noting the double standard that it never seemed to damage Field. But they also touch on some of the more explosive smears circulated about her during the leadership contest – including claims of an affair with an aide, allegations of predatory behaviour towards staff, and even one wild suggestion that there might be a sex tape of her in circulation. The authors interviewed her twice but their planned third session was canned when she resigned, so perhaps they simply never got to put these to her.

As to how things went wrong, perhaps she should have listened a bit more to others:

Despite his professional closeness to Truss, Cole and his co-author strive to put some distance between them in their final reflections on where it all went wrong. Putting aside her own fear, reportedly expressed to a visitor to the Foreign Office, that “I am weird and I don’t have any friends”, plausible theories for her implosion include that vaulting self-belief (even in her post-resignation speech to staff, she was still insisting she’d been on the right track) and determination to put the wrong people in cabinet.

How to read the books on Boris and Liz

In addition to a book on Truss, there is also one about Boris Johnson, by the Financial Times‘s Sebastian Payne.

How can one read both in chronological order?

Harry Cole says to read the first ten chapters of Out of the Blue, then Payne’s biography of Boris, then end with the final four chapters of Liz’s biography:

An MP writes

Recently, Simon Clarke, the Conservative MP for Middlesbrough South and East Cleveland who served as Secretary of State for Levelling Up, Housing and Communities in Liz Truss’s Government, and before that as Chief Secretary to the Treasury under Boris Johnson, wrote an article for the December 2022/January 2023 edition of The Critic on Truss’s premiership: ‘How did it all go so wrong for Liz Truss?’

Simon Clarke is one of the better Conservatives, in my estimation. He is diligent, good at the despatch box and is self-effacing. He is also very tall and, as such, when pictured with Rishi Sunak, walked some distance behind him so as not to accentuate the difference in height between the two of them.

Clarke begins his article with a weekend at Chevening, the Foreign Secretary’s country residence, and concludes with Truss’s last one at Chequers, as she closed out her premiership:

From Chevening to Chequers. For me, two weekends, eight weeks apart, will forever bookend my friend Liz Truss’s time as prime minister. The first, a wash of August Bank Holiday sunshine over the Kent countryside. Walking the grounds of the Foreign Secretary’s home with her on one of the last days of a leadership contest she had already won, listening as she outlined her vision for government, stalking ahead impatiently through the yellowing grass.

The second, an October Sunday in Buckinghamshire, an afternoon of bruised clouds and close heat foreshadowing the storm which broke as we dispersed. A small circle of family, ministers and aides, gathered in the Great Hall to say goodbye. A day defined by the quiet dignity and absence of self-pity of its principal protagonist, entirely typical of our host.

These memories are appropriate, because so much of what happened in between was decided at Chevening in the dog days of August.

Clarke has read Out of the Blue, which he liked, calling it:

a brisk and insightful canter through Liz’s career and the forces that shaped her …

In four breathless chapters at the close of their book, Heale and Cole do a good job of unpicking what went wrong, and why.

However, Clarke is disappointed they did not reach the conclusion he did — that Truss was right all along:

they largely decline to address an inconvenient truth — a truth perceived by those much-maligned Tory members all summer. Namely that in her diagnosis of the situation at home and abroad and what should be done about it, Liz Truss was fundamentally and importantly right

He goes through the failed mini-budget from September but points out that some of the fallout would have happened anyway:

In the eyes of millions of British voters, the fallout from the mini-budget meant the Government alone took responsibility for sharp spikes in both interest and mortgage rates, even though the majority of those increases were already in motion independently

He admits his error in the mini-budget but adds that Truss had a different economic plan during the summer:

The whole package was an exercise in Reaganomics without, fatally, the support of a reserve currency. Indeed, it was launched at the very moment when the strength of the dollar left sterling desperately exposed. As one of her Cabinet ministers, I take my share of the responsibility. But it is important to note that for much of the summer, there was a different plan. 

In July, in the days following Boris Johnson’s resignation, I spoke with Liz about how best to implement her vision for a higher growth, lower tax economy. The role of Chief Secretary to the Treasury is to be a voice of caution, and speaking as the incumbent to a predecessor, I highlighted the need for credible savings options to accompany her tax cuts, warning that without these we would be monstered. She agreed.

We settled on a new spending review, the exercise by which departmental budgets and priorities are determined in conjunction with Number 10 and the Treasury. Events in Ukraine meant the review conducted in September 2021 now strays close to being a fiction: the world has changed. It was time for a reassessment.

We discussed the relative merits of requiring five and ten per cent reductions in expenditure, achievable given how far spending has soared in recent years, and capable of being cushioned by the size of so many Whitehall departments’ Covid-driven underspends. 

Her only caveat, quite reasonably, was that it would be better to identify specific saving plans in the run-up to a budget once safely in office, as opposed to in the heat of a brutal campaign. But the overall approach of securing those savings was not, I believed, in any doubt. 

There was, therefore, a conscious and spectacular change in her policy from mid-July to the end of August. The latter two weeks of August seem to have been pivotal. With an unassailable polling lead and most votes already safely cast by party members, Liz settled in at Chevening for a blizzard of meetings. Here her distaste for “abacus economics”, always present, won out over caution. 

She was well within her rights to point out that the guardians of Treasury orthodoxy are bad at conducting dynamic modelling of the positive impact of both lower taxes and supply side reforms. But this was not the time to try to test that weakness.

Clarke thinks that Truss should have brought on board some of Sunak’s people. Personally, I do not think they would have helped. Perhaps they would have if she were a man:

As the storm broke from the mini- budget, so a second fundamental error of the Chevening days was laid bare: Liz’s choice of personnel. It was a mistake to have excluded from government so many of those who had backed Rishi Sunak. Her administration had too few allies when its momentum faltered, while a pared-back Downing Street operation found itself fighting on too many fronts.

The opposition was real and it was destructive:

What Heale and Cole could acknowledge more clearly is that there was a sizeable group of MPs who were unpersuadable from the beginning. From those who shivered at the thought of making the case for lowering the top rate of income tax back to the level at which it had stood at for all but the last six weeks of New Labour’s 13 years in office, even if it would raise more revenue, to those who did little to hide their desire for revenge for the summer’s reversal, the kindling was dry

Clarke says it is now important for Conservatives to look ahead to the next general election or face a Labour government:

And so we return to the fundamental point: that for all the brickbats, the platform on which Liz was elected PM remains important and urgent, and still needs to be delivered

Who can dispute the need for a plan for growth, at a time of flagging living standards when the Bank of England is forecasting a two-year recession? Taxes are at a 70-year high, and she was right to ease the burden by cutting National Insurance.

The opportunity for further tax cuts may have passed with the mini-budget, but supply-side reform is now more important, not less. Growth since the 2008 crash has been sluggish, and some of the principal reasons for this are the result of policy challenges that a Conservative government with a majority of 70 ought to confront.

I disagree with his plan to build more houses on the green belt but agree that the Conservatives need to maximise Brexit opportunities:

Productivity matters. We need to curb the culture of judicial review that ensures major infrastructure projects take years longer to deliver than they should. We also need to grasp the opportunities of Brexit, rather than just talk about them. Reform of EU rules such as Solvency II, proceeding with painful slowness, desperately needs to be accelerated if the City is to succeed

Liz saw this with total clarity and planned a series of interventions this autumn. If we are to get our economy moving, it is essential that we should act. None of these problems will resolve themselves of their own accord.

If her instinct for action on the home front was sound, it was doubly so abroad. The Northern Ireland Protocol legislation, so vital to ensuring that all parts of our country get to leave the EU, is very much Liz’s legacy from her time as Foreign Secretary. She understood better than almost anyone in the senior ranks of Government that Brexit cannot be a partial or half-hearted endeavour. Delivering this will be a central test for the new Government. 

And then there’s China:

With regard to China, Liz again rose to the level of events. Too many in British and European politics still cling to the German dream of Wandel durch Handel, or inspiring change through trade. Liz did indeed aim to deliver change through trade, but of a different kind. In one of the boldest policies of recent years, she had set out plans to build a democratic alternative to the Chinese “Belt and Road” initiative, not least by championing UK membership of the CPTPP trading bloc.

When she fell, she was poised to designate China officially as a threat to the UK. From the suppression of democracy in Hong Kong to the genocide being perpetrated against the Uighurs, we should be in no doubt as to the true nature of Xi’s regime. The West will only be able to resist this challenge if we readopt the Cold War trinity of moral confidence, economic dynamism and military strength, and Liz instinctively recognised this.

He concludes:

It was precisely because Liz’s sense of the kind of country we ought to be was so compelling that the Conservative party gave her their decisive backing this summer. It is her tragedy that the mistakes made at Chevening risk diminishing the vision she set out of a more successful Britain, walking tall abroad and better able to offer opportunity and dignity to her citizens at home …

In words which could be the epitaph for her short, extraordinary time as our prime minister, she reflected: “I think I could have gone out and done a better defence, and got on the front foot. On the other hand there is no point in doing these jobs unless you stand up for what you believe in.” 

Rishi laughs, but should he?

At last week’s Spectator Awards, everyone was there except Liz Truss.

The notional great and the good, politicians and journalists, gathered together. Pictured on the left is Grant Shapps MP and ex-BBC presenter Emily Maitlis:

Those who received awards and/or gave speeches, included witticisms:

Defence Secretary Ben Wallace won Minister of the Year:

As we had four Chancellors this year, it must have been hard for the magazine to choose, so they opted for Labour’s Rachel Reeves for Chancellor of the Year:

Labour leader Sir Keir Starmer won Politician of the Year:

Ukraine’s Volodymyr Zelenskyy won Parliamentarian of the Year. It looks like Transport Secretary Mark Harper gave the speech on his behalf:

During this annual starry schmoozefest, Prime Minister Rishi Sunak felt free to get a dig or two in about Liz Truss and the book:

Sunak quipped that the BBC turned down a request to make a television series about Cole and Heale’s book, because ‘it is hard to work with just one episode’. How they laughed:

Except things aren’t so funny for Rishi.

He had no honeymoon as Prime Minister and, within a month, Conservative backbenchers began rebelling.

On Wednesday, November 23, the aforementioned MP, Simon Clarke, tabled an amendment to relax the ban on onshore wind farms in England:

Late on Thursday, November 24, The Telegraph reported that Clarke’s proposed amendment was gaining traction. Furthermore, it had support from none other than Boris Johnson and Liz Truss:

Boris Johnson and Liz Truss have launched a challenge to Rishi Sunak’s authority by joining a Tory rebellion backing wind farms to tackle the energy crisis.

In their first major interventions since leaving Downing Street, the two former prime ministers have demanded an end to the ban on new onshore wind farms.

They both signed an amendment to the Government’s Levelling Up and Regeneration Bill, just days after Mr Sunak’s government was derailed by a separate Tory revolt on the same legislation.

The bill is designed to speed up housebuilding, which is crucial to Mr Sunak’s growth agenda.

The two former prime ministers have had tense relationships with Mr Sunak.

Mr Johnson’s supporters view Mr Sunak as having dealt the fatal blow to his premiership by resigning as chancellor.

Ms Truss and Mr Sunak clashed repeatedly during the leadership race.

It is unusual for former leaders to oppose their successors, with Theresa May choosing the issue of partygate to make a rare criticism of Mr Johnson

Mr Johnson signed the pro-onshore wind amendment, tabled by Simon Clarke, who was levelling up secretary under Ms Truss – even though he supported the ban, which has been in place since 2015, during his three years in office.

Ms Truss said she wanted to end the ban when she was in Number 10, because she believes the energy crisis means Britain needs more energy independence

The onshore wind revolt is the second blow to Mr Sunak’s bill. 

On Tuesday night, more than 50 Conservative MPs rebelled against his plans to impose centrally-dictated housebuilding targets – forcing the Prime Minister to delay the votes until December.

That revolt risked the prospect of Mr Sunak only being able to get the measure through with Labour support.

The latest rebellion looks set to be even more serious – not only because it has attracted the support of two former prime ministers, but because it is considered more likely that Labour would back measures to promote onshore wind.

By Thursday night, a total of 18 Conservative MPs had signed the amendment.

It demands that Michael Gove, the present Levelling Up Secretary, revises the National Planning Policy Framework to allow councils to grant new onshore wind applications.

The amendment would also force the Town and Country Planning Act to be amended to allow the installation of “new onshore wind sites not previously used for generating wind energy or for repowering existing onshore wind applications”.

On Monday, November 28, The Guardian reported that Sunak was likely to give in to Clarke, Boris, Liz and the other Conservative rebels:

Good morning. Rishi Sunak has only been prime minister for about a month, but already he is learning that a large part of his job consists of playing Whac-a-Mole with Tory party rebellions.

All party leaders face backbench rebellions from time to time but, with its poll ratings still in landslide defeat territory and MPs rushing for the post-parliament lifeboats, the Conservative party is more ungovernable than usual.

Sunak has had to postpone votes on the levelling up and regeneration bill (originally scheduled for today) because of two rebellions on it. One group of Tory MPs (the anti-growth coalition, as Liz Truss would call them), want to amend the bill to ban mandatory housebuilding targets, while another group of Tories (from the pro-growth coalition) are backing an amendment tabled by Simon Clarke, the former levelling up secretary, that would lift the ban on onshore windfarms. Although only 25 Tories have signed the Clarke amendment (less than half the number backing the one on housebuilding targets), Clarke’s is more dangerous because it has Labour backing.

This morning Grant Shapps, the business secretary, was doing the morning interview round and he signalled that the Whac-a-Mole mallet is coming down on the Clarke rebellion. As my colleague Peter Walker reports, Shapps hinted that the government will avert the onshore windfarm rebellion by giving in.

In immigration news that morning, Conservative backbencher David Davis told Sky News that the easiest way to stop the influx of Albanians via the English Channel is to send them back home. Albania is classified as a safe country, therefore, claiming asylum should be discounted. Davis has the backing of 50 other Conservative MPs. He said:

[Legislation] would go through and basically we would say to the Albanian population, anybody else who comes across the Channel will be sent back. When that starts to happen, there is no bigger deterrent … than if somebody in your village pays thousands of pounds to a human trafficker and then ends up back in the village three weeks later.

We shall see what happens on both wind farms and immigration.

For now, the Conservatives will have to make the best of Sunak’s premiership, as they cannot reasonably have any more Prime Ministers before the general election, which, all being well, is some time away, either near the end of 2024 or early in 2025.

Returning to Liz Truss, there was no question that she had insurmountable enemies, a subject I will explore later this week. In some respects, if she were a man, she would have been allowed to remain in office. Perhaps men deal with contrarian men better than contrarian women.

Tomorrow’s post looks at Liz Truss’s life.

My most recent post on Liz Truss left off with the beginning of the end in her final week as Conservative Party leader.

Friday, October 14

Her sacking of Kwasi Kwarteng and installation of Jeremy Hunt as Chancellor on Friday, October 14, meant only one thing — her end was nigh:

Liz Truss’s first Chancellor Kwasi Kwarteng: what he expected, what he got instead (October 13, 14)

Liz Truss and Kwasi Kwarteng illustrate that one DAY is a long time in politics (October 13, 14)

The Times‘s headline on the morning of the 14th said that Conservative MPs were already plotting to install Rishi Sunak and Penny Mordaunt in Truss’s place. One of them would be Prime Minister and the other would be Chancellor or Foreign Secretary:

The article also said (purple emphases mine):

Truss and Kwasi Kwarteng, the chancellor, are expected within days to make a humiliating climbdown over corporation tax in an effort to calm the markets and see off a mounting revolt.

Indeed, that is what Truss announced at her disastrous press conference that afternoon. By then, Jeremy Hunt was already Chancellor:

It was hard to believe, especially as Ireland’s corporation tax is half that: 12.5%. What is to stop businesses in Northern Ireland from moving south of the border?

Liz prefaced the announcement with:

This is difficult.

Guido Fawkes has the video and another quote preceding her announcement about corporation tax:

It is clear that parts of our mini-Budget went further and faster than markets were expecting… so the way we are delivering has to change…

He concluded (emphases his):

The mother of all U-turns…

Later in the afternoon, Wendy Morton, the Chief Whip, summoned Conservative MPs to an online call with the Deputy Prime Minister Thérèse Coffey.

One hundred of them dialled in. Coffey allegedly kept staring at her notes:

Saturday, October 15

Saturday’s papers were scathing.

The Daily Mail asked, ‘How much more can she (and the rest of us) take?’

The i paper led with ‘Tory MPs tell Truss: “It’s over”‘:

The Telegraph‘s Tom Harris wrote about the symbiotic relationship between the Prime Minister and the Chancellor from Margaret Thatcher’s time to Truss’s.

When that relationship goes wrong in a big way, it’s nearly always bad news for the PM, although there are exceptions:

When a prime minister loses a long-serving chancellor and ally – as Margaret Thatcher did when Nigel Lawson walked out of her government in 1989 – the political ramifications are enormous. In Thatcher’s case, that event signalled the beginning of her long defeat. When a prime minister loses a friend too, it becomes, as Liz Truss stated in her press conference, “not an easy” personal moment. 

Their closeness also makes it impossible for Truss to distance herself from the mess left at the Treasury. It is not clear which policy Kwarteng implemented that the prime minister was so unhappy with that she had to fire him. In 1989, Lawson resigned over his objection to the prime minister’s reliance on her economic adviser, Sir Alan Walters, but there were already disagreements between Numbers 10 and 11 over whether Britain should join the European Exchange Rate Mechanism. 

[John Major’s Norman] Lamont was fired over his handling of Britain’s departure from the same institution. Javid resigned over personnel issues. Rishi Sunak’s reasons for resigning were similar, though in his case the personnel issue involved the then prime minister himself.

In Jeremy Hunt, Liz Truss might be given a chance to form the kind of reassuring, mutually supportive – and, crucially, stable – relationship with her chancellor that good government demands. It would be foolish, however, to assume that when such a relationship breaks down, it is always the chancellor who is next to go.

The Telegraph‘s Camilla Tominey looked at the backbench Conservative MPs, wondering how Conservative they actually were. I was glad to see that she mentioned Alicia Kearns, who does not seem very Conservative to me.

Tominey’s article shows that a significant number of Conservative backbenchers do not hold traditional Conservative Party values:

Never underestimate the Conservative Party’s unparalleled ability to turn the gun on itself when coming under enemy fire. As the pot shots continued to rain thick and fast on Liz Truss’s troubled premiership, what did the Tories decide to do? With Labour’s help, they elected Alicia Kearns as chair of the Foreign Affairs Select Committee.

For those unfamiliar with Ms Kearns, she is the former Amnesty International activist who led the so-called “Pork Pie Plot” to oust Boris Johnson over partygate. Despite having been an MP for all of five minutes, the 34-year-old, who won the safe seat of Rutland and Melton in 2019 (hence the pork pie theme) decided that the Conservatives’ wisest move was to remove the man who secured the party’s biggest election win since 1987. Well, dip me in jellied pork stock and cover me in hot-crust pastry, that went swimmingly!

Having declared last year that she came into Parliament with “one legislative change I wanted to deliver, which was to ban conversion therapy”, inexperienced Kearns now occupies one of the most influential posts in the House of Commons.

Her first intervention? Following hot on the heels of her fellow chair, Mel Stride, of outspoken Treasury select committee fame, she used a radio interview on Thursday night to urge the Prime Minister to reverse the tax-cutting measures in the mini-Budget.

I’ve got nothing personally against Ms Kearns – she is clearly a thoughtful and intelligent woman. But if she isn’t for cutting tax, then what on earth is she doing in the Tory party, let alone now apparently in the running to enter a future Conservative Cabinet?

One former minister was this week quoted as saying: “Everything [the Government] are doing is everything that I don’t believe in.” Why, then, is that senior politician – apparently so opposed to spending controls and economic growth – not currently residing on Sir Keir Starmer’s shadow front bench or drinking Remaineraid with Sir Ed Davey?

As former Brexit negotiator Lord Frost put it on Thursday: “There are too many … social democrats operating under Conservative cover.”

It is one thing to be a broad church, but the Tories are currently taking on the mantle of a Blue Labour cult.

Not only are many of them perfectly comfortable with taxing people more, despite the tax burden being at its highest in 70 years, but they are also apparently as opposed to fracking as Ed Miliband. They seem to love the status quo and appear happy to watch Britain slowly sink into decline – along with their own party.

Tominey says that Liz Truss’s platform was clasically Conservative, and so was the one upon which Alicia Kearns was elected.

These are the MPs who will determine the outcome of Brexit and the next election. Both are in peril.

Tominey rightly lays the blame at the feet of former PM David Cameron, a wet who wanted a different type of Conservative MP:

David Cameron’s decision to introduce open primaries in the late 2000s, which saw wannabe MPs selected by non-members as well as members, was perhaps the most obvious mistake. The Conservatives ended up with “yellow” Tories in its ranks, such as Sarah Wollaston, who later defected to the Liberal Democrats.

Funnily enough, Sarah Wollaston is no longer an MP. Others like her, most of whom had the whip removed, were defeated or chose not to run in 2019.

This is the issue:

But more broadly, by inviting people with no background in Conservative politics to stand for Parliament, they ended up with people with no Tory backbone either. Holding successive snap elections only made the selection process less rigorous and open to people high on ambition and low on ideology.

This is a problem for the next general election. GEs depend upon local activists — party members — who are willing to canvass door-to-door:

We now have the Sunak squadders, calling for people to keep less of their wages, for businesses to pay more in corporation tax and for benefits to be linked to inflation, Corbyn-style …

Conservatives have become so detached from reality that they actually believe this will help them to win the next general election – even though it promises to prompt a mass walkout by the very grass-roots activists they rely on to run a campaign.

However, Tominey says that Rishi Sunak’s coronavirus handouts have also altered the public perception of the role of the state. We can but see how this will play in 2024 or early 2025 when the next GE comes along.

Monday, October 17

On Monday, October 17, Leader of the House Penny Mordaunt had to stand in for Truss during a debate. Opposition MPs accused Truss of hiding under a desk.

Mordaunt had to deny that more than once, saying that Truss had a ‘very genuine reason’ for not being present.

I don’t often feel sorry for Penny Mordaunt, but I did that day:

However, one Labour MP, Andrew Gwynne, tweeted that Liz Truss was the victim of a ‘coup’ — his word — and that Jeremy Hunt was the acting PM:

https://image.vuukle.com/f6a3e1ae-5984-48dd-8fe4-cb0a5368b71b-404bcb3a-bd15-43df-b0b6-f4920edde5c7

On Tuesday, October 18, The Times explained why Truss did not turn up at the despatch box the day before:

For much of the day Truss was conspicuous by her absence. She refused to respond to a question by Sir Keir Starmer in the Commons, prompting accusations from Labour that she was “frit”. Penny Mordaunt, the leader of the Commons, answered questions in her stead. She said that the prime minister had “a very good reason” for her absence but refused to explain further, prompting misplaced speculation that Truss had resigned.

That reason for her absence turned out to be a meeting with Sir Graham Brady, the chairman of the backbench 1922 Committee. Sources said that the meeting was routine and had been arranged before Kwarteng’s dismissal. But the issue of her leadership, and a potential revolt by Tory MPs, was said to have been discussed.

One source on the committee said there were a “number of views” on the way ahead but that there were concerns that an immediate move to defenestrate the prime minister could further destabilise the markets.

“The question is whether it is more damaging to create further uncertainty by getting rid of the prime minister when the chancellor [Hunt] appears to have settled the markets,” said an MP on the committee.

Some Tory MPs believe that with the unravelling of her tax-cutting agenda and signature energy policy she is finished politically. Sir Charles Walker became the fifth Conservative MP to publicly call for her to go, saying her position was “untenable”.

A senior Conservative source added: “It’s the biggest unforced humiliation for a British government since Suez. Eden did the decent thing and resigned.”

“The trouble is there is no consensus for who should replace her,” said one former backer of Rishi Sunak. “And the last thing we need now is to be seen to be causing more uncertainty on the financial markets.”

Monday night was grim.

On the subject of a coup, Nigel Farage agreed that Jeremy Hunt was in charge, and that this was a ‘globalist coup’:

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On his GB News show that night, Dan Wootton also said that there had been a coup. He agreed that the unpopular Hunt was in charge and that no one liked him, except for the Establishment. He said that if the Conservatives allowed this to continue, then they deserve to lose the next GE:

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Truss surfaced to give an interview to the BBC’s Chris Mason, wherein she apologised for the mini-budget. She said:

First of all, I do want to accept responsibility and say sorry for the mistakes that have been made. I wanted to act, to help people with their energy bills, to deal with the issue of high taxes, but we went too far and too fast. I have acknowledged that.

Tuesday, October 18

Tuesday’s headlines were deeply discouraging for her. Nearly all had photos of her alongside Hunt:

The new biography of Truss, Out of the Blue, was not even ready for publication. Someone photoshopped the cover with a remainder sticker on it, saying, ‘Reduced for quick sale — please just take it’:

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The Sun‘s political editor, Harry Cole, one of the book’s co-authors, posted an article about the MPs plotting against her:

TORY plotters dubbed the “Balti Bandits” carved up Liz Truss’s future last night over a korma and bhuna feast, The Sun reveals.

Leading rebel Mel Stride hosted more than a dozen “miserable” Conservative MPs in his large House of Commons office for an Indian takeaway – with the PM’s fate also on the table.

Ex-Ministers John Glen, Nick Gibb, Mark Garnier and Shailesh Vara tucked into “lashings of curry and naan” ordered in by Mr Stride, alongside outspoken backbencher Simon Hoare. 

2019 intake MPs Angela Richardson and Simon Baynes were also said to have joined the “poppadum plot” – but sources say the meeting ended with “no credible solution” to their woes

Contenders include ex-Chancellor Rishi Sunak, Defence Secretary Ben Wallace, new Chancellor Jeremy Hunt and Commons Leader Penny Mordaunt – but given the party is deeply split, the plotters admitted the chances of a rapid “coronation” of a new PM were “almost zero.”

One attendee told The Sun: “the vast majority of attendees were Rishi Sunak supporters, but there were Penny people too. It was not a Rishi thing.” 

On Tuesday evening, Truss had another group angry with her — her own supporters in the European Research Group, the pro-Brexit group of backbench Conservative MPs.

The Telegraph‘s Tim Stanley wrote about it, as he was there in the corridor for Truss’s meeting with them:

Liz Truss launched her fightback at 6pm in Committee Room 11. The meeting was actually set for 5pm; Commons voting ran late so Mark Francois advised us hacks to go away and come back later, but I hung around on the suspicion that the moment we left, Liz would slip out of her hiding place in the roof of the lift and jog, unseen, into the Room …

These are the true believers: if they’re angry at Liz for anything, it’s for not keeping the mini-Budget

What we saw of her on TV on Monday night, interviewed by Chris Mason, did not spark confidence as she uttered that dread word “sorry”, thus accepting personal responsibility for blunders past and future. It is the mark of an “honest politician”, she said, to admit mistakes. That’s true, but it’s also a dead giveaway for a not-very-good one, trying to turn a repeated error into a display of moral virtue. As Samuel Johnson might have said, “Honesty is the last refuge of the incompetent”.

She bobbed into view in a dark blue dress and black tights – fresh-faced, one suspects, from a good night’s sleep. Instinctively, I stood: she might be a PM, but she’s still a lady. I earnt a cheeky nod. Those who can’t fathom the rise of Ms Truss haven’t met her. She has a way of compromising you, of making you think you’re on her side, and it’s the most fun side of the room to be on.

The ERG roared as she entered. She entertained them behind a closed door for about 45 minutes. Then she left, followed by Mr Francois who told us it was “a very positive meeting”.

The PM evidently spoke about Northern Ireland and her commitment to raising defence spending by the end of the decade, which is ambitious for a woman who could be out of office by Friday. And he noted that David Canzini, the clever political operative, was with her, an eminence so grise, none of us had noticed he’d gone in.

No 10 confirmed it: he was hired as of that morning.

Too little too late. That might have been Canzini’s shortest job.

Wednesday, October 19

On Wednesday, October 19, Guido Fawkes posted that the Reform Party — formerly the Brexit Party — was climbing in the polls. The photo shows their chairman, businessman Richard Tice:

Guido’s post said, in part:

Guido can reveal that in the 48 hours before close of play yesterday afternoon, the old Brexit Party received almost 1000 new £25 membership sign-ups. That new five-figure cash boost was joined by 300 members registering a new interest in standing as a party candidate at the next election. The first time the Tories dipped below Labour in the polls – September 2021 – Reform saw one in 10 Tory voters switching to them. Can they continue capitalising on Liz’s woes?

It’s not just Reform benefitting from the dire state of No. 10. Last night the LibDems revealed five new donors, each giving £50,000 to the party, one of whom is a former Tory donor. While the last 36 hours have been calmer for Truss, it does feel like the ship has sprung one too many leaks to be repaired by a strong PMQs performance…

Wednesday was another fateful day. Home Secretary Suella Braverman resigned, then a confusing scene took place in the voting lobby over a division (vote) on fracking, which resulted in more chaos when it was unclear whether Wendy Morton had resigned as Chief Whip:

Liz Truss’s final 24 hours: Suella Braverman’s resignation, question over Whips’ resignations (October 19)

Truss appointed Grant Shapps, former Transport Secretary, in Braverman’s place:

Holy mole, guacamole!

Nigel Farage repeated ‘coup’ in his tweet about the news:

As with Hunt, Truss had to scrape the barrel.

The Telegraph reported that, like Hunt, Shapps was not a Truss supporter:

It is a remarkable turnaround for Mr Shapps, the transport secretary under Boris Johnson who went on to become a prominent supporter of Ms Truss’s leadership rival Rishi Sunak.

Only on Monday night, Mr Shapps was telling a theatre audience that he believed Ms Truss had a “Mount Everest to climb” to remain in power.

“I don’t think there’s any secret she has a mountain, a Mount Everest to climb,” he told Matt Forde’s podcast. “What she needs to do is like threading the eye of a needle with the lights off.”

Now he is one of her most senior ministers – and another example of the way a weakened Ms Truss is being forced to offer olive branches to the Sunak supporters she had previously shunned.

Not only was Mr Shapps questioning her chances of success until as early as this week – he was working proactively to get rid of her.

Mr Shapps has been viewed in Westminster as one of the leaders of the opposition to Truss’s libertarian policies.

He spoke up at the Tory party conference in Birmingham earlier this month against her plans to scrap the 45p rate of income tax, and warned that Ms Truss had “10 days” to turn things around or MPs “might as well roll the dice and elect a new leader”.

This is what the aforementioned Camilla Tominey was lamenting in Conservative MPs. Some of the recent ones have no appreciation of or allegiance to Conservative values. Shapps was a Cameronian MP.

The article also discussed Shapps’s famous spreadsheets which appear to work as well as the 1922 Committee in making or breaking a Prime Minister:

The veteran MP – known by some as the “Duracell Bunny” for his enthusiasm – is also well-known for his “Star Wars” spreadsheet, with which he has spent the past few weeks recording the views of MPs on Ms Truss and her plans.

Mr Shapps used an earlier version of his famous spreadsheet to lead a rebellion against Theresa May, and also utilised its information to help guide Boris Johnson into Downing Street.

The spreadsheet is said to contain more than 6,000 historical “data points” from previous conversations with MPs.

It was rumoured that he had been in contact with Mr Johnson and Mr Sunak to see if they would join an effort to oust Ms Truss. And some rebel MPs claimed he had even offered himself up as a caretaker prime minister.

Let us not forget that Shapps himself is hardly a paragon of virtue:

… unfortunately for Mr Shapps, some elements of his past may make a shot at No 10 less than likely – not least the Michael Green saga.

This was an alter-ego he employed to enable him to run a series of get-rich-quick schemes on the internet while he was an MP.

Mr Shapps originally denied he had a second job, and threatened legal action against a constituent who said he had. But he was forced to admit practising business under a pseudonym in March 2015.

All this happened while he was Tory chairman, in charge of David Cameron’s efforts to win the 2015 election.

He was demoted soon after to aid minister, and resigned from that role after claims he had ignored repeated allegations of bullying involving the Tories’ youth organiser. It was said the alleged bullying, which took place on the party’s RoadTrip 2015 campaign, may have caused one party member to commit suicide.

On Wednesday evening, Camilla Tominey reprised her warning about un-Conservative MPs and their takeover of the Government. She, too, used the word ‘coup’:

the departure of Suella Braverman as home secretary speaks to a bigger problem for Liz Truss than sheer optics.

In sacking two key allies on the Right, only for them to be replaced by opponents more to the Left of the party, the Prime Minister is increasingly looking like the victim of a Conservative coup.

It is certainly ironic that the former home secretary, in post for just 43 days, first used that word to describe those who plotted against Ms Truss’s original plan to link benefit to wages rather than inflation

With that, and most of her mini-Budget up in flames thanks to a rebellion by the moderates, Jeremy Hunt now appears to be the de facto Prime Minister.

He will now be joined by his fellow Sunakite Grant Shapps, who despite being rejected from Ms Truss’s original cabinet, has now been appointed to replace Mrs Braverman at the Home Office.

Braverman, at one point, had headed the aforementioned European Research Group:

her swift exit from one of the highest posts in public office will anger her European Research Group supporters.

It was only on Tuesday evening that Ms Truss was said to have charmed the backbench group of Eurosceptics with her honest, straight-talking approach.

They are unlikely to take kindly to their former chairman, a darling of the grassroots, being ejected in such unseemly fashion.

Mrs Braverman, a Conservative leadership candidate herself over the summer, received the longest standing ovation at the Tory Party conference two weeks ago.

Fortunately, Rishi Sunak re-appointed Braverman as Home Secretary. He probably realised he had to, in order to keep Party members on side.

Returning to Wednesday, October 19, The Telegraph posted an article stating that Conservative backbenchers were asking Labour for help in ousting Truss. Unbelievable:

Rebel Tories have been asking Labour MPs to help them overthrow Liz Truss, The Telegraph has been told.

Conservative backbenchers are growing increasingly frustrated with the Prime Minister’s leadership, but currently lack any mechanisms to remove her given the one-year immunity she has from a no confidence vote.

As things stand, the only way to oust Ms Truss would be to change the rules – which is a decision that only the executive of the 1922 committee of backbenchers can make – or if she resigns of her own volition.

One Labour MP told The Telegraph: “Tories are speaking to us saying ‘this is a complete nightmare and there is no way out’. We are being asked ‘can’t you do something about her?’”

The MP, who said their colleagues have reported similar experiences, said they were approached by one Red Wall MP whose constituency was in the north and another MP who is a member of the One Nation group of moderates …

A Labour source said: “There is very little Labour can do. Even a vote of no confidence doesn’t have the constitutional standing that it used to. The Tory party are the ones that elected her, they need to get rid of her.”

The paper’s Michael Deacon wrote that Conservative MPs were entirely to blame for the mess. Furthermore, he said, they risked angering Party members, the campaigning activists, if they pushed ahead with a rule change saying that the members would no longer be able to vote for future Party leaders. The members elected Truss over Sunak in August:

This week, The Telegraph reported that Tory MPs want to bar members from voting in future leadership elections. Supposedly the reason is to speed up the process of choosing a leader. But this is blatantly a smokescreen. Quite plainly, MPs just want to prevent the members from landing them with another turkey like Truss.

Many members are appalled by this suggestion. And so they should be. Such a plan is not just arrogant and undemocratic, it’s delusional. Because party members aren’t to blame for the current mess.

Tory MPs are.

After all, who put Truss on the ballot paper in the first place? Tory MPs. No fewer than 113 of them, in fact. A third of the parliamentary party. Out of an initial field of 11 candidates for the leadership, Truss was the MPs’ second favourite.

Unlike the MPs, however, the party members weren’t allowed to choose between the initial field of 11. If they had been, it’s extremely unlikely that they would have chosen Truss. They’d have been far more likely to choose Penny Mordaunt or Kemi Badenoch, to name just two. In fact, if the MPs had deigned to ask them, I suspect that the greatest number of members would have wanted their leader to be Boris Johnson – the person they chose to be leader in the first place.

The truth is, the members voted for Truss simply because they didn’t want to vote for Rishi Sunak. In leadership contests, they’re only ever given two candidates to choose from. And why? Because Tory MPs don’t trust them. They fear that, if presented with a wide-open field, party members will choose the “wrong” candidate. Funny how things turn out.

All things considered, then, it seems clear that, if anyone should be barred from voting in leadership contests, it should be Tory MPs. In future, just leave it to the wiser judgment of the members instead.

That night, The Telegraph posted an article by Lord Frost saying that the Party was moving towards a status quo, if not anti-Brexit, stance, going all the way back to David Cameron’s time as Prime Minister, with George Osborne as Chancellor and Philip Hammond in the same post under Theresa May:

… the Government is implementing neither the programme Liz Truss originally advocated nor the 2019 manifesto. It is going in a completely different direction. We are back to Osbornomics, the continuity Hammond view of the world. There is no shred of a mandate for this. It’s only happening because the Truss Government messed things up more badly than anyone could have imagined, and enabled a hostile takeover by its opponents …

… the correct account of the past few weeks is the simplest. Truss tried to deliver worthwhile reforms and set the country onto a much-needed new direction. I supported this policy direction and still do. But it was rushed and bungled. The markets were spooked. The mistakes were opportunistically seized on by her opponents to undermine her leadership, to blame Brexit, and to stop the party getting out of the social democratic tractor beam of the past few years. And now, under pressure, the Prime Minister has reversed tack completely.

The risk now is that we lose for a generation the opportunity to do anything better. Every time the PM defends her approach, she denounces the policies on which she was chosen. The danger is that necessary and correct reforms are discredited.

Frost held that Truss was ultimately responsible for her own downfall.

As such, she had to go:

We are where we are. I am very sorry about it, because I had such high hopes. Whatever happens to her ministers or the stability of the Government in the next few days, Truss just can’t stay in office for one very obvious reason: she campaigned against the policies she is now implementing. However masterfully she now implements them – and it doesn’t seem that it will be very masterfully – it just won’t do. She said she wouldn’t U-turn, and then she did. Her fate is to be the Henry VI of modern politics – a weak figurehead, unable to control the forces around her, occasionally humiliated, and disposed of when she has become inconvenient. Better to go now.

As for her successor and the Party:

Then the party must do two things: avoid making the economic situation even worse by repeating the policies of the Cameron government in totally different circumstances; and recover some political legitimacy for carrying on – because in our system legitimacy does matter.

Thursday, October 20

After 44 days, Liz Truss resigned as Conservative Party leader on Thursday, October 20.

She served as Prime Minister for 50 days, beating George Canning’s record of 118 days. Also a Conservative, he died of tuberculosis in 1827.

She remained PM until Rishi Sunak succeeded her:

Liz Truss’s final 24 hours: Suella Braverman’s resignation, question over Whips’ resignations (October 19)

Liz Truss’s final 24 hours: fallout over Braverman and Morton, no tears in exit speech (October 19, 20)

Rishi Sunak becomes Prime Minister: a momentous morning of historic significance (October 24, 25)

How Rishi Sunak won the Conservative Party leadership contest — part 1 (October 20, 21, 25)

How Rishi Sunak won the Conservative Party leadership contest — part 2 (October 21, 26, 27)

How Rishi Sunak won the Conservative Party leadership contest — part 3 (October 22-24, 27, 28)

On Thursday morning, The Telegraph posted a Planet Normal podcast in which Lord Frost said he could see Brexit being reversed:

In the wide-ranging discussion, Lord Frost also said that he could see a future where Brexit is reversed. 

“Brexit was about giving us the power to do things ourselves and to give responsibility back to British ministers, British governments. And they’ve shown that many of them are not up to the job in the last year or two.”

“I can easily see a situation where Keir Starmer gets in. We drift back closer into the single market and go back into the Customs Union. And then everyone says why are we in these things where we don’t get a say in them? Wouldn’t it be better to be a member? So I can easily see how it could happen. And the way you stop it happening is to prove, while we have the levers of power, that we can do things differently and better. And at the moment we’re not making a very good job of that, unfortunately.”

Little did Truss know that, the day before, she had stood at the despatch box for her last PMQs:

She resigned early on Thursday afternoon. Thankfully, she didn’t cry, unlike Theresa May, who broke down at the podium (Guido has the video):

Sterling began surging the second Truss finished her announcement:

In less than 24 hours, the Conservative Party website deleted her presence from their home page (Guido has the before and after screenshots):

It was a sad ending to a sad episode of British parliamentary history.

Next week, I will look at who, besides Truss herself, was also responsible for it.

Truss is currently spending time in her own constituency and has not yet appeared on the backbenches, an alien place for someone who had been a minister of state for most of her career.

While this is a change to the previous schedule of analysing Liz Truss’s premiership, more about which next week, there are references below as to why hers and Kwasi Kwarteng’s plan was the right one for the UK.

Chancellor Jeremy Hunt delivered his Autumn Statement — a Labourite Conservative budget — on Thursday, November 17, 2022.

Compared with Kwasi Kwarteng’s fiscal event of September 23, this will be a disaster for most middle class Britons.

It was clear that Hunt designed this budget to placate the all-hallowed — for whatever reason — OBR (Office for Budget Responsibility) and the markets. Stability is their watchword. Growth, regardless of what Hunt said yesterday, plays little part in our economy for the foreseeable future.

Unlike Kwarteng’s, which did focus on growth, Hunt’s statement had little to no consideration of the British taxpayer in a cost of living crisis.

What Hunt said

Before going into Hunt’s address, Guido Fawkes has a brief summary and the full detail from the Treasury, a 70-page document.

Below are excerpts from Hunt’s Autumn Statement to the House of Commons (emphases mine):

… today we deliver a plan to tackle the cost of living crisis and rebuild our economy. Our priorities are stability, growth and public services. We also protect the vulnerable, because to be British is to be compassionate and this is a compassionate Conservative Government.

Remember when then-Chancellor Rishi Sunak told us we did not have to worry about the cost of borrowing and borrowing itself during the pandemic? Well, now we have to worry:

Most countries are still dealing with the fallout from a once-in-a-century pandemic. The furlough scheme, the vaccine roll-out and the response of the NHS did our country proud, but they all have to be paid for.

Hunt paid homage to the Bank of England and had a poke at Kwarteng for not doing so:

So the Bank of England, which has done an outstanding job since its independence, now has my wholehearted support in its mission to defeat inflation and I today confirm we will not change its remit. But we need fiscal and monetary policy to work together, and that means the Government and the Bank working in lockstep.

He delivered a deeper attack on Kwarteng:

I understand the motivation of my predecessor’s mini-Budget and he was correct to identify growth as a priority, but unfunded tax cuts are as risky as unfunded spending, which is why we reversed the planned measures quickly. As a result, Government borrowing has fallen, the pound has strengthened and the OBR says today that the lower interest rates generated by the Government’s actions are already benefiting our economy and public finances. But credibility cannot be taken for granted and yesterday’s inflation figures show we must continue a relentless fight to bring it down, including a rock solid commitment to rebuild our public finances.

He bowed before the all-powerful OBR, whose forecasts have not been terribly accurate over the past few years. Let us see if these come true in the coming months:

Richard Hughes and his team at the OBR today lay out starkly the impact of global headwinds on the UK economy, and I am enormously grateful to him and his team for their thorough work. The OBR forecasts the UK’s inflation rate to be 9.1% this year and 7.4% next year. It confirms that our actions today help inflation to fall sharply from the middle of next year. It also judges that the UK, like other countries, is now in recession. Overall this year, the economy is still forecast to grow by 4.2%. GDP then falls in 2023 by 1.4%, before rising by 1.3%, 2.6% and 2.7% in the following three years. The OBR says higher energy prices explain the majority of the downward revision in cumulative growth since March. It also expects a rise in unemployment from 3.6% today to 4.9% in 2024, before falling to 4.1%.

This is Hunt’s strategy, with the blessing of the OBR and borrowing Sunak’s morality from the August leadership campaign about leaving debts to the next generation:

I also confirm two new fiscal rules. The first is that underlying debt must fall as a percentage of GDP by the fifth year of a rolling five-year period. The second is that public sector borrowing over the same period must be below 3% of GDP. The plan I am announcing today meets both rules.

Today’s statement delivers a consolidation of £55 billion, and means inflation and interest rates end up significantly lower. We achieve this in a balanced way. In the short term, as growth slows and unemployment rises, we will use fiscal policy to support the economy. The OBR confirms that, because of our plans, the recession is shallower and inflation is reduced. Unemployment is also lower, with about 70,000 jobs saved as a result of our decisions today. Then, once growth returns, we increase the pace of consolidation to get debt falling. This further reduces the pressure on the Bank to raise interest rates, because as Conservatives we do not leave our debts to the next generation.

So this is a balanced path to stability, tackling inflation to reduce the cost of living and protect pensioner savings, while supporting the economy on a path to growth. But it means taking difficult decisions.

Hunt then discussed the fiscal drag elements of the budget. Fiscal drag means drawing the unsuspecting into paying new and more tax:

I start with personal taxes. Asking more from those who have more means that the first difficult decision I take on tax is to reduce the threshold at which the 45p rate becomes payable from £150,000 to £125,140. Those earning £150,000 or more will pay just over £1,200 more in tax every year. We are also taking difficult decisions on tax-free allowances. I am maintaining at current levels the income tax personal allowance, higher rate threshold, main national insurance thresholds and the inheritance tax thresholds for a further two years, taking us to April 2028. Even after that, we will still have the most generous set of tax-free allowances of any G7 country.

I was amazed he could talk about 2028 with a straight face. By then, we will probably have a Labour government. Oh well, he’s done their work for them.

Continuing on tax rises, he said:

I am also reforming allowances on unearned income. The dividend allowance will be cut from £2,000 to £1,000 next year, and then to £500 from April 2024. The annual exempt amount for capital gains tax will be cut from £12,300 to £6,000 next year, and then £3,000 from April 2024. Those changes still leave us with more generous allowances than countries such as Germany, Ireland, France, and Canada.

Because the OBR forecasts that half of all new vehicles will be electric by 2025, to make our motoring tax system fairer, I have decided that from then electric vehicles will no longer be exempt from vehicle excise duty. Company car tax rates will remain lower for electric vehicles, and I have listened to industry bodies and will limit rate increases to 1 percentage point a year for three years from 2025.

At least he kept one thing from Kwarteng’s statement:

The OBR expects housing activity to slow over the next two years, so the stamp duty cuts announced in the mini-Budget will remain in place but only until 31 March 2025. After that, I will sunset the measure, creating an incentive to support the housing market, and the jobs associated with it, by boosting transaction during the period when the economy most needs it.

He won’t even be Chancellor then.

Moving on to businesses:

I now turn to business taxes. Although I have decided to freeze the employers national insurance contributions threshold until April 2028, we will retain the employment allowance at its new higher level of £5,000. That means that 40% of all businesses will pay no NICs at all. The VAT threshold is already more than twice as high as the EU and OECD averages. I will maintain it at that level until March 2026.

Then came the windfall tax:

Can I just say that any such tax should be temporary, not deter investment and recognise the cyclical nature of energy businesses? So, taking account of that, I have decided that from 1 January until March 2028 we will increase the energy profits levy from 25% to 35%. The structure of our energy market also creates windfall profits for low-carbon electricity generation, so we have decided to introduce, from 1 January, a new, temporary 45% levy on electricity generators. Together, those measures will raise £14 billion next year.

Business rates have been a thorn in the side of those enterprises on our high streets. Here, it would seem, Hunt offered some relief:

Finally, I turn to business rates. It is an important principle that bills should accurately reflect market values, so we will proceed with the revaluation of business properties from April 2023, but I will soften the blow on businesses with a nearly £14 billion tax cut over the next five years. Nearly two thirds of properties will not pay a penny more next year and thousands of pubs, restaurants and small high street shops will benefit. That will include a new Government-funded transitional relief scheme, as called for by the CBI, the British Retail Consortium, the Federation of Small Businesses and others, benefiting around 700,000 businesses.

Then he turned to people on benefits, proving that Sunak’s furlough scheme during the pandemic was more than adequate:

… I am proud to live in a country with one of the most comprehensive safety nets anywhere in the world. But I am also concerned that we have seen a sharp increase in economically inactive working-age adults of about 630,000 people since the start of the pandemic. Employment levels have yet to return to pre-pandemic levels, which is bad for businesses who cannot fill vacancies and bad for people missing out on the opportunity to do well for themselves and their families, so the Prime Minister has asked the Work and Pensions Secretary to do a thorough review of issues holding back workforce participation, to conclude early in the new year.

Alongside that, I am also committed to helping people already in work to raise their incomes, progress in work and become financially independent. So we will ask over 600,000 more people on universal credit to meet with a work coach so that they can get the support that they need to increase their hours or earnings. I have also decided to move back the managed transition of people from employment and support allowance on to universal credit to 2028, and will invest an extra £280 million in the DWP to crack down on benefit fraud and error over the next two years. The Government’s review of the state pension age will be published in early 2023.

He then discussed foreign spending:

… I salute the citizens of another country right on the frontline … the brave people of Ukraine. The United Kingdom has given them military support worth £2.3 billion since the start of Putin’s invasion, the second highest contribution in the world after the United States, which demonstrates that our commitment to democracy and open societies remains steadfast. In that context, the Prime Minister and I both recognise the need to increase defence spending. But before we make that commitment, it is necessary to revise and update the integrated review, written as it was before the Ukraine invasion. I have asked for that vital work to be completed ahead of the next Budget and today I confirm that we will continue to maintain the defence budget at at least 2% of GDP to be consistent with our NATO commitment.

I was pleased to hear that overseas aid will stay at 0.5%:

Another important international commitment is to overseas aid. The OBR’s forecasts show a significant shock to public finances, so it will not be possible to return to the 0.7% target until the fiscal situation allows. We remain fully committed to that target, and the plans I have set out today assume that official development assistance spending will remain around 0.5% for the forecast period. As a percentage of GNI, we were the third highest donor in the G7 last year, and I am proud that our aid commitment has saved thousands of lives around the world.

Net Zero is still going ahead:

I also confirm that, despite the economic pressures, we remain fully committed to the historic Glasgow climate pact agreed at COP26, including a 68% reduction in our own emissions by 2030.

He discussed schools, beginning with those in England:

we have risen nine places in the global league tables for maths and reading in the last seven years.

… as Chancellor I want to know the answer to one simple question: will every young person leave the education system with the skills they would get in Japan, Germany or Switzerland? So, I have appointed Sir Michael Barber to advise me and my right hon. Friend the Education Secretary on the implementation of our skills reform programme.

Some have suggested putting VAT on independent school fees as a way of increasing core funding for schools, which would raise about £1.7 billion. But according to certain estimates, that would result in up to 90,000 children from the independent sector switching to state schools, giving with one hand only to take away with another.

So instead of being ideological, I am going to be practical: because we want school standards to continue to rise for every single child, we are going to do more than protect the schools budget—we are going to increase it. I can announce today that next year and the year after, we will invest an extra £2.3 billion per annum in our schools.

He has asked a former Labour MP, Patricia Hewitt, to help him reform the NHS. Oh, my days:

I have asked the former Health Secretary and chair of the Norfolk and Waveney integrated care system, Patricia Hewitt, to help me and the Health Secretary to achieve that by advising us on how to make sure that the new integrated care boards, the local NHS bodies, operate efficiently and with appropriate autonomy and accountability. I have also had discussions with NHS England about the inflationary pressures on their budgets.

More money will be pumped into the system:

With £3.3 billion for the NHS and £4.7 billion for social care, there is a record £8 billion package for our health and care system. That is a Conservative Government putting the NHS first.

Barnett consequentials, which come from the hard-pressed English taxpayer, will also increase:

The NHS and schools in Scotland, Wales and Northern Ireland face equivalent pressures, so the Barnett consequentials of today’s decisions mean an extra £1.5 billion for the Scottish Government, £1.2 billion for the Welsh Government, and £650 million for the Northern Ireland Executive. That means more resources for the schools and hospitals in our devolved nations next year, the year after and every year thereafter.

A new energy strategy will be forthcoming from the Business Secretary.

These are Hunt’s infrastructure commitments:

… today I can announce that I am not cutting a penny from our capital budgets in the next two years, and I am maintaining them at that level in cash terms for the following three years. That means that although we are not growing our capital budget as planned, it will still increase from £63 billion four years ago to £114 billion next year and £115 billion the year after, and will remain at that level—more than double what it was under the last Labour Government.

Smart countries build on their long-term commitments rather than discarding them, so today I confirm that because of this decision, alongside Sizewell C, we will deliver the core Northern Powerhouse Rail, HS2 to Manchester, East West Rail, the new hospitals programme and gigabit broadband roll-out. All these and more will be funded as promised, with over £600 billion of investment over the next five years to connect our country and grow our economy.

Our national Conservative mission is to level up economic opportunity across the country. That, too, needs investment in infrastructure, so I will proceed with round 2 of the levelling-up fund, at least matching the £1.7 billion value of round 1. We will also drive growth across the UK by working with the Scottish Government on the feasibility study for the A75, supporting the advanced technology research centre in Wales and funding a trade and investment event in Northern Ireland next year.

He is bringing devolution to England in the form of mayoralties:

Our brilliant [Conservative] Mayors such as Andy Street and Ben Houchen have shown the power of civic entrepreneurship. We need more of this inspirational local leadership, so today I can announce a new devolution deal that will bring an elected Mayor to Suffolk, and deals to bring Mayors to Cornwall, Norfolk and an area in the north-east to follow shortly. We are also making progress towards trailblazer devolution deals with the Greater Manchester Combined Authority and the West Midlands Combined Authority, and soon over half of England will be covered by devolution deals. Taken together, that £600 billion investment in our future growth represents the largest investment in public works for 40 years, so our children and grandchildren can be confident that this Conservative Government are investing in their future.

Hunt is altering the Truss-Kwarteng investment zones to be more in line with Michael Gove’s aspirations for levelling up:

I will also change our approach to investment zones, which will now focus on leveraging our research strengths by being centred on universities in left-behind areas, to help to build clusters for our new growth industries. My right hon. Friend the Levelling Up Secretary will work with Mayors, devolved Administrations and local partners to achieve this, with the first decisions announced ahead of the spring Budget.

The Truss-Kwarteng energy support plan remains in place until the end of March 2023:

I pay tribute to my predecessor, my right hon. Friend the Member for Spelthorne (Kwasi Kwarteng), and to the former Prime Minister, my right hon. Friend the Member for South West Norfolk (Elizabeth Truss), for their leadership in this area. This winter, we will stick with their plan to spend £55 billion to help households and businesses with their energy bills—one of the largest support plans in Europe. From April, we will continue the energy price guarantee for a further 12 months at a higher level of £3,000 per year for the average household. With prices forecast to remain elevated throughout next year, this will mean an average of £500 of support for every household in the country.

There is more help for the most vulnerable:

At the same time, for the most vulnerable, we will introduce additional cost of living payments next year of £900 to households on means-tested benefits, £300 to pensioner households and £150 for individuals on disability benefit. We will also provide an additional £1 billion of funding to enable a further 12-month extension to the household support fund, helping local authorities to assist those who might otherwise fall through the cracks. For those households that use alternative fuels such as heating oil and liquefied petroleum gas to heat their homes, I am today doubling the support from £100 to £200, which will be delivered as soon as possible this winter. Before the end of this year, we will also bring forward a new targeted approach to support businesses from next April.

But I want to go further to support the people most exposed to high inflation. Around 4 million families live in the social rented sector—almost one fifth of households in England. Their rents are set at 1% above the September inflation rate, which means that on current plans they are set to see rent hikes next year of up to 11%. For many, that would just be unaffordable, so today I can announce that this Government will cap the increase in social rents at a maximum of 7% in 2023-24. Compared with current plans, that is a saving for the average tenant of £200 next year.

Labour started a commotion at this point. Hunt then announced a rise in the minimum wage:

This Government introduced—[Interruption.] I thought they cared about the most vulnerable! This Government introduced the national living wage, which has been a giant step in eliminating low pay, so today I am accepting the recommendation of the Low Pay Commission to increase it next year by 9.7%. This means that, from April 2023, the hourly rate will be £10.42, which represents an annual pay rise worth over £1,600 to a full-time worker. It is expected to benefit over 2 million of the lowest-paid workers in our country, and it keeps us on track for our target to reach two thirds of median earnings by 2024. It is the largest increase in the UK’s national living wage ever.

Benefits will increase by the rate of inflation:

today I commit to uprating such benefits by inflation, with an increase of 10.1%. That is an expensive commitment, costing £11 billion, but it means that 10 million working-age families will see a much-needed increase next year, which speaks to our priorities as a Government and our priorities as a nation. On average, a family on universal credit will benefit next year by around £600. To increase the number of households that can benefit from this decision, I will also exceptionally increase the benefit cap by inflation next year.

Finally, I have talked a lot about the British values of compassion, hard work, dignity and fairness, but there is no more British value than our commitment to protect and honour those who built the country we live in, so to support the poorest pensioners I have decided to increase pension credit by 10.1%, which is worth up to £1,470 for a couple and £960 for a single pensioner in our most vulnerable households, but the cost of living crisis is harming not just our poorest pensioners but all pensioners.

The triple-lock stays:

Because we have taken difficult decisions elsewhere today, I can also announce that we will fulfil our pledge to the country to protect the pension triple lock. In April, the state pension will increase in line with inflation, an £870 increase, which represents the biggest ever increase in the state pension. To the millions of pensioners who will benefit from this measure, I say: “Now and always, this Government are on your side.”

Hunt did not receive a jubilant reception from Conservative MPs, some of whom had concerns.

Dr Liam Fox asked about quantitative easing and interest rates:

I congratulate my right hon. Friend on a balanced and skilful statement prioritising fiscal stability. He will be aware that some of us believe that the Bank of England maintained monetary conditions that were too loose for too long, but that it would also be a mistake to maintain monetary conditions that are too tight for too long. Can he therefore confirm that the anti-inflationary measures that he has taken today will mean that the pressure to raise interest rates will be minimised, and that there is a much greater chance that they will fall earlier than would otherwise have been the case?

Hunt replied:

My right hon. Friend is absolutely right to focus on this issue, because every 1% increase in interest rates is about £850 more on the average mortgage, so it is hugely important to families up and down the country. The OBR has said that the measures that we have taken today will mean that inflation is lower than it would otherwise have been. That means that the Bank of England is under less pressure to increase interest rates, which for reasons that he knows are such a worry for so many families.

Sir William Cash was concerned about the ever-increasing costs of the HS2 rail project:

My right hon. Friend argued for sound money and sound foundations. Would he be good enough to explain how it is that High Speed 2 will continue beyond Birmingham at a verifiable cost of at least £40 billion, when every independent report on HS2 condemns the project and confirms that phase 2 will make rail services to all west coast destinations north of Birmingham much worse? I ask him to make a clear commitment to keep this matter under review at all costs; it is in the national interest.

Hunt said:

My hon. Friend is right that the increases in the budget for HS2 are disappointing, but a strong economy needs to have consistency of purpose, and that means saying we will make sure that we are a better connected country. The lack of those connections is one of the fundamental reasons for the differences in wealth between north and south, which we are so committed to addressing. There is a bigger issue about the way that we do infrastructure projects: it takes too long, and the budgets therefore get out of control. We are just not very good at it, and we have to sort it out.

Theresa Villiers rightly asked how soon we could move to a lower-tax economy if the forecasts are wrong. For me, this was the question of the day:

I thank the Chancellor for the announcement on schools funding, which, as he knows, is something that I raised with him as being crucial. Can he also confirm that, if current forecasts about economic recovery and inflation prove to be overly pessimistic, we will move more quickly than he has announced today towards delivering a lower-tax economy?

Hunt was non-committal:

My right hon. Friend is an immensely experienced colleague. She is right to point out that there is always inaccuracy in any forecast, and there is always variation from fiscal event to fiscal event, so we keep all those decisions under review in the round. I think it is still important to have forecasts—that is better than not to have them—but we keep all those decisions under review.

Virginia Crosbie from Ynys Môn in Wales asked how soon the new nuclear programme would begin:

This Government’s commitment to Sizewell C and large-scale nuclear is welcome, and it was noted that Labour’s shadow Chancellor failed to mention nuclear. When will the launch of Great British Nuclear be announced, and will its scope include large-scale gigawatt nuclear at sites such as Wylfa in my constituency, as well as small modular reactors?

Hunt was encouraging:

There is no more formidable advocate for big nuclear investment on Ynys Môn than my hon. Friend. Indeed, when I went on a family holiday to Ynys Môn this summer, she tried to persuade me to visit the potential site of a nuclear power station with my children. I apologise that I did not take her up on the offer, but it shows her commitment. My right hon. Friend the Business Secretary will be making an announcement soon on things such as the launch of Great British Nuclear—I hope before Christmas, but if not just afterwards—because we want to crack on with our nuclear programme.

Richard Drax was concerned about the burden on the taxpayer, another excellent question:

I have huge sympathy for my right hon. Friend. We are facing severe financial challenges for the reasons he explained so well, but Members on both sides of the House are promising to spend billions and billions more pounds. I remind the House that it is the private sector, and hardworking people through their taxes, who pay for Government expenditure. Does my right hon. Friend agree that raising taxes on both risks stifling the growth and productivity that he and I both want, and that would counter the recession we are now in?

Hunt defended his budget:

My hon. Friend is right to make the case for a lightly taxed dynamic economy, and I would like to bring taxes down from their current level. We are faced with the necessity of doing something fast to restore sound money and bring inflation down from 11%, which is why we have made difficult decisions today. But yes, my hon. Friend is absolutely right: there is no future for this country unless we get back on the path to being a lower taxed economy.

Mark Pawsey asked about small businesses:

My constituents in Rugby and Bulkington will not enjoy the tough decisions that the Chancellor has had to make today, but they will understand the need for sound finances after the huge expenditure that the country has made on the pandemic and supporting people with their energy costs as a consequence of the war in Ukraine. They will also want to know that businesses will continue to invest to grow and to create jobs. Will he speak about the incentives that still exist for businesses to do exactly that?

Hunt pledged his support:

I am happy to do that. My hon. Friend is quite right to raise those issues. We are doing a lot of short-term things, including help with energy bills as well as business rates. As we move to a new business rates system, we are freezing the levels at which business rates can increase and introducing a 75% discount next year for retail, hospitality and leisure businesses. Fundamentally, as a Conservative Government, we know that we cannot flourish as an economy without flourishing small businesses, and we will back them to the hilt.

Greg Smith asked what Hunt was doing about reducing fuel duty:

I absolutely agree with my right hon. Friend when he talks about the inflationary pressures coming from the aftershocks of the pandemic and the war in Ukraine. We see that at the fuel pumps and, more significantly, our haulage and logistics sector sees it with the enormous level of taxation on diesel in particular driving inflation to get food and goods on to our shelves. As he prepares for the March Budget, will he look at the inflationary impact of fuel duty on top of the high cost of diesel and see whether we can reduce it?

Hunt said he was looking at the issue:

I assure my hon. Friend that I will absolutely do that. We have a little time, and I know that fuel duty is an important issue to him and many other colleagues.

March 2023 — fuel duty hike

Hunt’s answer to Greg Smith on the fuel duty hike sounded reassuring, but GB News’s economic editor Liam Halligan uncovered a planned fuel duty hike of 23% for March 2023 from the OBR forecast. It would be the first since 2011:

Here’s Liam Halligan talking about it:

Forbes noticed it, too, bringing the news to an even wider international audience:

https://image.vuukle.com/8d46442a-2514-45e7-9794-98dfc370ce1b-94c4922a-473b-4f2c-bf6c-332bb8ccac4e

Fiscal drag

The Times had an article on the upcoming fiscal drag following Hunt’s budget:

Disposable incomes, after adjusting for inflation, will fall by 4.3 per cent in 2022-23, which would be the largest fall since records began in the 1950s. It is set to be followed by the second largest fall — in 2023-24 — of 2.8 per cent.

… Despite the aspirations of Rishi Sunak to create a low-tax economy, Britain is on course for its biggest ever tax burden as hundreds of thousands of workers are dragged into higher income tax bands by the freezing of thresholds and allowances while businesses also face a jump in levies, including employment taxes.

The tax burden is set to rise to 37.5 per cent of GDP in the financial year ending 2025, reaching the highest level since records began shortly after the Second World War.

The level of taxation as a share of the national income will rise to 36.4 per cent of GDP this year and 37.4 per cent in the financial year ending 2024, breaking the previous record.

Recovery is not likely to begin until 2025, several months after the next general election. This is accurate only if Conservatives are still in power by then:

GDP is expected to rise by 4.2 per cent this year before falling by 1.4 per cent next year, only returning to pre-pandemic levels by the end of 2024. However, growth is expected to pick up to 2.6 per cent the following year and 2.7 per cent in 2026, following a recovery in real incomes, consumption and investment.

The Telegraph also had an article on fiscal drag:

Nearly a quarter of a million workers will be dragged into paying the 45p rate of income tax after Jeremy Hunt slashed the threshold at which it is charged.

The salary on which the additional rate is payable will be reduced from £150,000 to £125,140 effective next April, Chancellor Jeremy Hunt announced in the Autumn Statement, and frozen until 2028, forcing 232,000 workers into paying the top rate of tax for the first time and costing these quarter of a million taxpayers £620 on average, according to wealth manager Quilter.

The number of workers paying 45pc has more than doubled since the rate was first introduced in 2010 – rising from 236,000 to 629,000 today – as wage inflation has pushed more taxpayers into the highest income tax band.

Lowering the threshold will cost the 629,000 workers earning over £150,000 who are already impacted by the 45pc tax an additional £1,250 …

Just two months ago, then-Chancellor Kwasi Kwarteng promised that the top rate would be abolished altogether. But now the Government is hoping to earn £420m in 2023-24 by catching more taxpayers in the 45pc net, and almost double that – £855m – in 2027-28.

Neela Chauhan of accountancy firm UHY Hacker Young said the move was “a major attack” on higher earners.

She added: “It’s going to bring in people into the upper rate who feel that they are far from being rich.”

Tax firm RSM said that there are also unexpected consequences of slashing the additional-rate threshold and the Chancellor had opened the door to a new 67.5pc tax rate.

Taxpayers earning over £100,000 lose their personal allowance at a rate of £1 for every £2 of income.

This means for every £100 they earn between £100,000 and £125,140, a worker takes home just £40 – because £40 is lost to income tax and another £20 to the tapering of the personal allowance – creating a 60pc tax trap.

Dismal headlines

The Guardian has a breakdown of last Friday’s front pages, which were bleak.

The Telegraph noted the austerity of George Osborne, Chancellor when the Conservative-Lib Dem coalition took over from in 2010, and the Labourite policies of his predecessor Gordon Brown. At the bottom of the page is an analysis from Lord Frost:

Lord Frost’s analysis is pro-Truss/Kwarteng

Lord Frost points out that the OBR are predicting what Liz Truss did just a few weeks ago:

This was a very curious Autumn Statement. For the last month, we have been told that Britain needed to re-establish the confidence of the markets and put in place renewed fiscal discipline, supposedly so carelessly squandered by Liz Truss. “Eye-wateringly painful decisions” were coming for all of us …

… public spending will be at its highest since the 1970s and taxation the highest since the Second World War. Both only start to fall, gently, in the late 2020s, and then only because of some pretty heroic assumptions about growth. Indeed, under Liz Truss we were told that 2.5 per cent growth was impossible – yet the Office for Budget Responsibility (OBR) is predicting exactly that for 2025 and 2026.

How do we explain this?

To do so, I think, we have to go back to that extraordinary week in mid-October, when Truss’s government blew up on the launch pad

She was levered out of Downing Street with the argument that she had been careless about the public finances, casual about fiscal discipline and had lost market confidence. An emergency correction was needed – tax rises or spending cuts, and probably both.

Yet on taking office, our current government will have found – as the OBR has now acknowledged – that we were already into a deepening recession. Tightening fiscal policy with growth collapsing and interest rates increasing globally would clearly have been an insane policy, one at variance with what virtually every economist would suggest. But, having destroyed the Truss administration for being insufficiently fiscally disciplinarian, the Government could hardly overtly change course itself.

That is why we got what we got. Keep growing spending, raise taxes now on unpopular groups, defer deficit reduction and everything else until 2025, and meanwhile talk a lot about austerity and discipline to disguise the reality that this is likely a similar fiscal policy to what Truss’s would have been, just at higher levels of tax and spend. Then, after the election, if the Conservatives are still in power, it can all be looked at again …

… Taxes on business wreck investment and growth. Taxes on the (not very) rich destroy incentives. Britain’s hard-won reputation for being a low tax country is permanently lost. And we all have less of our own money and are less free.

Another defence of Trussonomics

The Mail reminds us that the Truss plan was to cap energy prices for two years. Hunt has reduced this to the end of March 2023:

Average energy bills will rise to £3,000 a year from April as Chancellor Jeremy Hunt confirmed he was scrapping previous Government plans.

In his Autumn Statement to the House of Commons, Mr Hunt revealed changes to the ‘Energy Price Guarantee’ would leave Britons facing higher gas and electricity payments next year.

When former prime minister Liz Truss first announced the cost of living support in September, she outlined how average energy bills would be frozen at £2,500 a year for the next two years

Delivering details of an altered plan today, Mr Hunt revealed the Energy Price Guarantee would now be set at a higher level of £3,000 a year for average households until April 2024.

Of course, those who use less energy at home might have less to pay:

The plan only caps the cost per unit that households pay, with actual bills still determined by how much is consumed.

Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, said:

The fact that this comes on top of so many other price rises means life is going to get even tougher next spring.

More Trussonomics

The Spectator‘s editor Fraser Nelson wrote an analysis of the budget for The Telegraph, ‘This could turn out to be the week that the Tories lost the next election’.

I noted above that some of what Hunt said points far into the future.

Fraser Nelson also observed that fact:

Suspiciously, almost all of this austerity is due to take place after April 2025, after the election. The Tory benches were very quiet during Hunt’s speech, perhaps because they were piecing all this together. It was not just an Autumn Statement being written, but the next Conservative manifesto, too – with all the bad stuff saved for after the vote. Hardly the behaviour of a party expecting to win.

As one minister put it: “This was the day we lost the election.” This is how some Tories see the Autumn Statement: a suicide note, wrapping a poison pill for a Keir Starmer government to swallow.

This is the alarming rate of borrowing today. Factor in the previous QE and the generous Sunak pandemic programmes when he was Chancellor:

Even now, the Government is borrowing £485 million a day – or £20,000 by the time you finish this sentence. It all needs to be repaid. And the interest we all have to pay for such debt is, broadly, treble what it was a year ago.

The new forecasts show a UK Government expecting to pay £484 billion in debt interest over the next five years – almost £300 billion more than was expected this time last year. This year alone it’s £120 billion, twice last year’s sum.

This extra £60 billion has had to come from somewhere. It’s enough to double the size of the military, treble the police force or rebuild every school or hospital. But instead it is dead money, servicing an old debt – and things need to be squeezed to make room for it. For years, Tories wrote cheques, for HS2 and more, barely thinking about the cost. Now the bill has landed.

Nelson doesn’t mention the number of times long-serving Conservative backbenchers warned Sunak over the past two years that the bill would come due, but I saw them in parliamentary debates being duly ignored. To Sunak, those men were mere Thatcherites, so last century. Rishi told us we could borrow with little consequence. Not so.

He created a lot of our current problems and campaigned in August that he would be the candidate to get us out of this situation.

Now he is No. 10, just as he wanted to be from the beginning:

Sunak can’t be blamed for the debt interest. But he might have been expected to have better ideas of how to get out of the mess.

Of the Autumn Statement, Nelson writes:

Liz Truss said her message was “growth, growth, growth,” but Sunak’s seems to be “brace, brace, brace”. A massive fiscal impact lies ahead, he says – and our mission is to recognise it, make our peace with it, and accept that talk about a low-tax future is futile. So his Autumn Statement did not kick-start a recovery. It was, instead, a requiem for growth.

Of the August leadership campaign, he reminds us:

During the leadership debate, Truss was asked what advice she would give to Sunak. Don’t be so fatalistic, she told him. Don’t go along with narratives of decline. She had a point. Groundless optimism ended her premiership very quickly, but groundless pessimism can also be deeply damaging.

Nelson wonders how a government can so quickly discount its people:

A million more Brits, for example, are expected to join the 1.7 million already claiming disability or health-related benefits over the next five years. They will, in turn, join the 3.5 million others on out-of-work benefits. Was it so unreasonable to hope that this number might go down, with people helped back to work? We’ve been promised a review into all this, but not much else.

Another assumption is that most of the 400,000 who have dropped out of the economy since the pandemic started, citing long-term sickness, will never work again. It’s hard to find many other countries giving up so readily on such a stunningly large chunk of the population.

Is a uniquely British malady at work here? Or is the real problem a kind of Tory fatalism, where an exhausted governing party thinks the country is now too old, too sick or simply too workshy to get back to where it was in January 2020?

Many conservative voters said at the time that Rishi’s furlough scheme was a bit too helpful — and we were paying for it.

Now we are paying even more for it.

Nelson concludes:

the risk is that voters make up their mind now – and associate Toryism with chaos, broken promises and a general counsel of despair. Labour just needs to promise to do things better. As things stand, it’s not a very high bar.

Feeling fleeced yet?

The Telegraph‘s editorial warned, ‘Hard times ahead for British taxpayers’:

Unlike the tumultuous response to Kwasi Kwarteng’s unfunded growth measures in September, the market reaction was muted, which is precisely what Mr Hunt hoped for, even if the pound fell against the dollar amid forecasts of a year-long recession …

… benefits and the old age pension will rise in April by 10.1 per cent, the inflation rate in October.

This continues a trend of recent years whereby working people are expected to pay more in tax to protect social programmes that successive governments have been reluctant to reform. Although headline tax rates have not risen, the extended freeze on allowances at a time of double-digit inflation is a serious hit to the incomes of millions who will be dragged into higher bands. Some three million earners will pay income tax for the first time.

This year will see the sharpest fall in living standards on record, while the tax burden rises to its highest level as a share of GDP in decades. More than 47 per cent of national income will be spent in the public sector. In fact, spending will actually rise in real terms. The cuts are to planned budgets.

Rishi Sunak and Mr Hunt consider this social democratic approach to be fair and compassionate, closing off attack lines from Labour as a general election approaches. But there are consequences for the long-term well-being of the country if working people and businesses feel they are being fleeced to prop up failing public services and a benefit system in need of a drastic overhaul.

Essentially, the productive part of the economy is being squeezed to prop up the unproductive. The problem Mr Sunak faces is that, by 2024, the Conservatives will have been in office for 14 years and they need to offer voters a better slogan than “Labour will be worse”. In fact, Labour would support many of the measures in the Autumn Statement, from loading more tax on the wealthy to increasing windfall taxes on the energy companies.

ministers need to prepare for the worst and could proactively address the biggest drags on the economy, above all the NHS, social care and welfare benefits. The health service continues to soak up huge sums – with another £6 billion announced yesterday – and yet produces worse outcomes. Its shortcomings are causing problems throughout the economy, with treatment backlogs contributing to acute manpower shortages which the Government intends to fill by increasing immigration.

The Spectator‘s political editor James Forsyth, a close friend of Rishi Sunak’s, explained in The Times why this recession is different to previous ones and why we need more people in the workforce. I hope his friend pays attention to this:

One bright spot amid the gloom is the unemployment rate, which is just 3.6 per cent, down from 3.8 per cent this year. This is close to historic lows. But even this glimmer is tarnished. The low unemployment number disguises how many people have left the labour force: one in five working-age Brits are economically inactive, meaning they are neither in work nor looking for it. More than five million are claiming out-of-work benefits.

The recession may last a year, perhaps two — but it will be different. Unemployment, as formally defined, won’t exceed 5 per cent even during the worst of the downturn — in the 1980s it went into double digits. Seldom have there been more vacancies in the economy. It’s an odd form of recession where almost anyone who wants a job can find one, but that’s the situation we’re in. Almost every month, the number of those not looking for work grows: it jumped by 169,000 in the three months to August. That is more than the population of Oxford.

This has consequences. The OBR thinks the cost of health and disability benefits will rise by £7.5 billion — quite a sum. A shrinking labour market is also one of the reasons why the Bank of England thinks potential growth is now a mere 0.75 per cent even in 2024-25. The Tories desperately need to get back to moving people from welfare into work — not just to reduce the welfare bill but also to boost the economy

Alongside those not in work nor looking for it, there are 970,000 people on Universal Credit who are working very limited hours in an economy where employers are offering shifts. Hunt announced that about 600,000 of them will now be required to meet a work coach to try to increase their hours. This signals a return to Tory welfare reform …

to ensure taxes don’t need to keep going up indefinitely, two things are needed. The first is a renewed emphasis on public-sector reform. The Tory mantra used to be more for less from public services. But in recent years, it has felt like the opposite is the case. As the Institute for Fiscal Studies pointed out this week, the NHS has more money and more staff than it did before Covid yet is treating fewer people on the waiting list. This needs reversing if the tax burden is not to continue climbing ever higher.

The second is the economy needs to grow. Meat needs to be put on the bones of the growth agenda that Sunak and Hunt set out this week, with further incentives for businesses to invest.

After the debacle of the mini-budget, this autumn statement was always going to be about steadying the ship. Yet satisfying the markets is a necessary but not sufficient condition for a successful government. Sunak and Hunt must now deliver on public service reform, moving people from welfare into work and getting more out of the health and education budgets.

The Telegraph had more on the parlous state of the NHS, despite more taxpayer money being dumped into it, all for nought:

An analysis by the Institute for Fiscal Studies shows the health service in England carried out 600,000 fewer procedures in the first nine months of 2022, compared with the same period in 2019.

The NHS’s budget rose from £123.7 billion in 2019-20 to £151.8  billion in 2022-23, with the extra funding tied to a target of increasing elective hospital activity by 30 per cent compared with pre-pandemic levels. This will not only be missed but matters have worsened. Why is no one being held to account?

Record sums have been poured in for years, yet there is now a waiting list of more than seven million patients. Working practices remain stuck in the past, with consultants complaining that hospitals are “like the Mary Celeste” at weekends, while most GP surgeries are only open on weekdays, pushing patients to overstretched A&E services.

The NHS unions are not helping in their demands for more money.

The article concludes:

There is something fundamentally wrong with the NHS which politicians must confront before it crashes and brings the rest of the economy down with it.

Hunt puts economic hope in migrants

It seems the OBR, a quango started by the Conservative Chancellor George Osborne and staffed by Labourites, has convinced Jeremy Hunt that he should increase our already heavy migration levels to boost the economy.

That’s a left-wing idea that has never worked.

Home Secretary Suella Braverman will oppose that, but can she succeed? Only a few weeks ago, a 90-minute argument with Liz Truss and Hunt resulted in Braverman’s resignation. Her security violations were a likely smokescreen for what really happened.

The Telegraph reported:

Jeremy Hunt is relying on a surge in net migration to more than 200,000 people per year to help deliver economic growth as he oversees a sharp rise in the tax burden to its highest ever peacetime level.

The Office for Budget Responsibility (OBR) predicted net migration – the numbers entering the UK minus those leaving – will be 224,000 next year, before gently declining to settle at 205,000 a year from 2026 onwards.

This is dramatically higher than the OBR’s March estimate, when it predicted that net migration would be between 139,000 and 129,000 in the same years, some 80,000 lower.

It is also significantly higher than the long-term “ambition” of Suella Braverman, the Home Secretary, to reduce net migration to below 100,000 – similar to the target of Theresa May, one of her predecessors in the post.

The increase in migrant labour will help to buttress Britain’s economy as Mr Hunt imposes higher taxes on earnings, jobs and investment. The OBR said that an increase in migration would help add to the potential size of the economy.

However, rising costs from tax are creating “growing disincentives to work”, reduce business investment and depress wages, according to the OBR itself.

Business groups were even more damning. The Chancellor talked a lot about “hard work” and “fairness” in his Autumn Statement. But workers, entrepreneurs and businesses have been left to pick up the bill to keep Britain’s welfare state on the road.

The OBR are being deeply irresponsible in advocating city-sized populations coming from abroad each year.

Where will these people live? How is our infrastructure — medical facilities, schools, water supply — increase to meet this demand year upon year?

Anyone travelling by Tube can pick up a copy of the Evening Standard to read about how many British twenty-somethings in London cannot find a room to rent. In many cases, there are 100 of them chasing every available room. The Standard interviews them. Their stories are heart-breaking. These young people are signed up to every rental app, to no avail.

Council tax increasing

On top of all of this, The Times reported that Hunt has given the green light to councils to increase council tax:

… the chancellor announced “more council tax flexibilities”, enabling councils in England to raise council tax by 3 per cent a year (up from 2 per cent) from April 2023 and increase the adult social care precept by 2 per cent a year (up from 1 per cent) without having to hold a referendum — leaving councils free to raise the tax by up to 5 per cent next year.

Their article has charts of various council tax rates and offers this example:

If they decide to increase council tax by the full 5 per cent, council tax band D payments would rise by £115 from £2,300 to £2,415 a year in Rutland in the East Midlands — the local authority with the most expensive tax bills in England — while in Westminster in central London, the cheapest authority, they would increase by just £43 from £866 to £909 a year.

Short takes

The Telegraph has an article on winners and losers from the Autumn Statement. There are only two groups of winners: housebuyers and pensioners/benefits claimants.

The Guardian interviewed some of Hunt’s constituents in leafy South West Surrey. They are unhappy with him as MP and are equally unhappy with the Government.

Guido Fawkes’s sketchwriter summed up Hunt’s announcement as follows:

What was the job of the day? To persuade the markets that all was under control. That debt-to-GDP would fall in reasonable time, that things would get back to normal in his cool, technocratic, managerial hands.

It’s what we all need, to believe that someone knows how things work and that they know what they’re doing. That there is such a thing as “sound money”. That the great, communal hallucination of financial reality may be preserved.

In Guido’s view, the Chancellor did exactly that. (Pound crashes, housing market collapses, the global financial architecture disappears into the Pacific Trench)

The readers’ comments near the end of that post have to do with the raw deal Liz Truss got. Here’s the exchange:

I find it impossible to believe that Liz Truss did so much damage in a couple of weeks with a mini budget which was never even enacted to require today’s grotesque socialist budget. Hunt and Rishi must be following an ideological policy and using Truss as their excuse.

Yes, she’s been made a convenient scapegoat by the WEF shills, to cover all their earlier and current mistakes and wrongdoings.

She went too far too fast and, by doing so, gave the one nation Tories and SunakHunts the opportunity to bring her down. The real villains are Sunak and Bailey [Bank of England governor] with their money printing and inflation denial. We are paying for their mistakes.

She didn’t go too far too fast. That is the Conservative spin. The Socialist spin is that she crashed the economy. It was cautious and a promising start, a direction of travel being set, nothing more – except for that huge two year package on the gas bills which was pure socialism and not mentioned by anyone.

The true Conservative spin is that, as an experienced Cabinet minister, she didn’t scan the political and financial hinterlands and underestimated the faux Conservative forces ranged against her. Once she u-turned she was done for.

On another of Guido’s posts, a reader posited that this is all about reversing Brexit:

The champagne socialist billionaire Rishi Sunak and arch remainer narssisist Jeremy Hunt have nailed the final nails in the socialist party AKA as the Conservative party coffin. They will be wiped out at the next GE for a generation. They want to tank the economy and make everyone feel financial pain so they can say BREXIT didn’t work. They will then seem to come to the rescue with every excuse on the planet and join us up first to the single market and customs union. Then kicking and screaming back into the EU. Why do you think they staged this remainer coup and got rid of Truss? The Truss budget of low tax, high wages, high growth, low government spend and the scrapping of the 2300-3000 EU laws retained on the UK statue book would have taken advantage of BREXIT and boosted the economy. They could not allow that to happen. They want to ditch plans to scrap the EU laws as that will make it harder to leave. They have folded on the NI Protocol and leaving the Jurisdiction of the ECHR. Why? Because they want to rejoin. We now are having forced on us a low wage, high tax, low growth, high government spend economy that will cripple most people financially and small businesses. Who wants to invest in the UK now?

On that note, another reader posted a photo of Hunt and Sunak sharing a laugh, with this fictitious caption:

Hunt: Told you you didn’t need the support of the members.

Sunak: Yes, it was so easy to stab Truss in the back, too. Who needs democracy?

What taxpayers can do

All is not lost for taxpayers. There are ways to mitigate the effects from Hunt’s statement.

Anyone who needs to cut back on food costs, protein in particular, should start eating eggs, which are cheap and the best source of protein around. Supposedly, they’re in short supply, but I bought a dozen only yesterday.

The Telegraph has an excellent article on various egg preparations, whether sweet or savoury. It’s well worth reading.

The paper also has a helpful article about what taxpayers can do to mitigate Hunt’s raid on their money. Some will require advice from a financial planner. The most important tip is to get one’s capital gains in order and start liquidating shares or funds to put into an ISA — a process called ‘bed and ISA’ — without exceeding the CGT thresholds. This has to be started well before the end of the 2022-23 tax year in April, when the current capital gains threshold of £12,300 expires and becomes £6,000 for one year, then £3,000 the year after that.

Good luck!

Yesterday’s post looked back at Liz Truss’s leadership campaign during the latter half of August 2022.

As September started, most ordinary conservatives were happy to know that Liz was likely to be the next Party leader.

On September 3, the veteran journalist Janet Daley wrote an empathetic column about her for The Telegraph, ‘Ignore conventional wisdom: the new prime minister is not doomed’.

CCHQ — Conservative Party headquarters — had not yet finished counting the members’ votes, but Daley thought that people would give Liz their support in the face of the cost of living crisis (emphases mine):

Given that virtually everyone in the country accepts that the current dilemma is both desperately urgent and, in the short term, utterly hopeless, Liz Truss will begin her premiership with the lowest possible expectations and, given the inherent fair mindedness of the British population, even a little sympathy

Whether Daley realised it or not at the time, she hit the proverbial on the head in the second paragraph:

Standing up in the House – or better, at that podium in Downing Street – to address a nation that has been terrified out of its wits by predictions of the devastation that is to come, will look like an act of singular bravery and resolve. Most of the country, apart from sworn partisan enemies (the most pathologically vicious of whom are inside her own party), will be willing her to succeed in whatever terms success can be measured, against the impossible odds. She will not have a honeymoon as such, but she can gain points for rigorous resolve and determination – especially if she seems to be in touch with the justifiable fears of real people. That will be the key to it. Every word, every pronouncement, every policy will have to be communicated with infinite humaneness: genuine compassion for the impact that this crisis is having on daily life and future prospects …

Although this was Daley’s prediction at the time, this is how things played out with most fair-minded voters:

Ordinary people who do not have an ideological dog in the fight know that this is uncharted territory. What disagreements there are – and will continue to be – over the right way to proceed will be accepted as reasonable argument and not necessarily discrediting to the sitting government providing that it remains proactive and committed.

I particularly liked the next bit, which posited that, as the year went on, things might turn out to be less gloomy than forecast during the summer:

there is the possibility of some good (or less bad) news in the coming months. What if the combined efforts and ingenuity of the Western economies produce more optimistic projections for energy subsistence sooner than was expected? Already we hear that gas storage in Europe is exceeding expectations and, as a result, commodity prices are beginning to fall.

However, Daley, for all her brilliance, did not foresee the savage attack from Liz’s fellow MPs.

North of the border, Scotland’s First Minister Nicola Sturgeon was still seething that Liz had called her an ‘attention seeker’ during the campaign:

During her premiership, Liz never did contact Nicola Sturgeon.

On Monday, September 5, these were the main news stories. We could rely on The Independent for negative stories about our new Prime Minister:

https://image.vuukle.com/4ece1f13-7c15-4fa7-aac3-2c3f9e556168-84991a44-e32a-4b2e-8428-41fa907f8388

The Mail on Sunday‘s Dan Hodges was thrilled. He had predicted Liz’s ascendancy on Boxing Day 2021:

His article says that Liz’s rise began when she replaced Dominic Raab as Foreign Secretary. During his time in post, he said that all ministers (MPs) serving under him were to be called Junior Ministers (JMs) rather than Ministers. The MPs were none too happy with that move.

Then, when Biden’s sudden withdrawal from Afghanistan took place in mid-August 2021, Raab was on holiday in the Mediterranean with his family. Boris replaced him with Liz:

On her first day in the job, she issued a note to her officials ordering the JM designation be dropped.

‘Liz gets it,’ a Minister said. ‘She knows how to treat her colleagues properly. It’s one of the reasons she’s been so successful.’

Spectacularly successful. 2021 has been Liz Truss’s year

She’s now in charge of masterminding the final fraught stages of Britain’s EU exit.

And – were Boris to suddenly fall beneath a heavily laden wine-and-cheese platter – favourite to replace him in No 10 Downing Street.

At the time Hodges had written his article, Boris was becoming more embroiled in Partygate allegations, which had begun in November 2021.

We thought that Boris had a diverse Cabinet. It was nothing like Liz’s, however:

The Mail reported:

Ms Truss is expected to make long-term ally Kwasi Kwarteng chancellor, with Suella Braverman moving to the Home Office and James Cleverly to the Foreign Office.

If selected, Mr Kwarteng would be the fourth non-white chancellor in a row, directly following Sajid Javid, Rishi Sunak and Nadhim Zahawi.

And Ms Braverman would become the third minority home secretary, after Priti Patel and Mr Javid

Mr Cleverly, currently the Education Secretary, would become the first ever non-white foreign Secretary.

Cleverly continues in post today under Rishi Sunak, as does Kemi Badenoch, International Trade Secretary and Minister for Women and Equalities:

Would the media — our diversity champions — give her, our third female Conservative PM, any credit? Never:

On a related note, Liz gave us a Health and Social Care Secretary with a fondness for cigars, the likes of which we had not seen since Kenneth Clarke in the 1990s. Here is Thérèse Coffey, one of her close friends, pictured at a Spectator summer party a few years ago:

However, just as important were the people no longer in Cabinet. This is worth noting. Some said later that this is where Liz’s premiership became unstuck, that she should have held on to some opponents:

There is expected to be a clear out of Rishi Sunak and his supporters after a bitter blue-on-blue campaign in which he seems almost certain to be defeated.

Into the political wilderness too will go Michael Gove, after serving under the three previous PMs. Dominic Raab, the First Secretary of State, and Boris Johnson himself, are expected to return to the backbenches. Both have question marks over whether they can hold on to their seats at the next election.

I think she did the right thing. We’d seen enough of all of them over the past three years and, in Gove’s case, much longer than that.

They would not have been friendly:

Other backbench Conservative MPs were unfriendly, too:

Rishi was unaccustomed to being on the backbenches, and his first opportunity to participate in a debate came that Tuesday afternoon. Guido Fawkes reported:

Backbencher Rishi Sunak making a debate intervention today on “unavoidably small hospitals“:

Thank you for accommodating me at a late stage in this debate. I hadn’t planned on speaking but this morning I saw the order paper and it turns out I had more time on my hands than I anticipated.

Tuesday’s Mail pointed out the Conservatives have had three women PMs. Labour have had none, not even a female Party leader:

We were also entering a new generation of PMs who were younger than we:

Liz’s supporters in the media were hopeful:

James Johnson’s Politico article said:

The main qualities the public look for from their leaders in the 2020s are honesty, strength and authenticity. It will require care and calibration, but Truss has a path to come closer to these than Starmer.

If she stands in Downing Street on Tuesday and levels with the public about the challenge ahead and tells them to judge her on results in two years’ time she will not only create a reputational shield for herself but also have the opportunity to make a novel mark on the public — many of whom will be tuning into her for the first time — as someone who gives it to them straight.

Some have suggested that her more libertarian instincts and views, such as decrying a focus on redistribution, make her unelectable. But voters, especially those new Tory converts in the Red Wall, value consistency — a quality they feel is so lacking in modern politicians — as much as an individual policy position. Focus group attendees praise Thatcher and Blair when asked if there are any politicians they admire not because they agreed with them on everything, but because they felt they held beliefs and stuck with them.

One of Truss’ biggest applause lines in one of the early debates was that she is not the slickest media performer, but she gets things done. If she successfully harnesses that sentiment, the ideological gap between her and the public on specific issues or an awkward communication style may matter less …

It could all come undone, of course. Moments in the summer would have been similarly disastrous for Truss in a live election campaign environment. The calibre of her team will be crucial

There is a pathway for the Conservative Party. If followed, the optimistic scenario for Liz Truss is underpriced.

Like the aforementioned Janet Daley, James Johnson underestimated the opposition on the Conservative backbenches.

After flying back from Aberdeen, the closest airport to Balmoral, Liz gave her first address as Prime Minister. Heavy downpours punctuated the afternoon. The weather, combined with London’s rush hour traffic, delayed her. The rain let up long enough for her to give her speech, in which she borrowed a line from Churchill, ‘Action this day’. Her husband, Hugh O’Leary, stood on the sidelines:

Liz’s first call to a foreign leader was to Volodymyr Zelenskyy to reassure him that the UK would continue to support Ukraine:

One of her economic advisers, Gerard Lyons, was confident that a low-tax economic plan would help to stave off recession:

The cost of living crisis made Wednesday’s papers, September 7. These front pages show Liz’s husband:

The Telegraph borrowed words from her speech, ‘We can ride out the storm’:

Wednesday saw Liz’s first Prime Minister’s Questions (PMQs). This is the full half hour:

She managed to lob a few witty grenades Keir Starmer’s way.

To roars of applause from Conservatives, Liz pointed out that there is nothing new about a Labour leader wanting tax rises:

Guido noted that the comment painted Starmer the same colour as his predecessor, the very left-wing Jeremy Corbyn (emphases his):

It only took a free marketeer PM to bring out Starmer’s inner Corbynite…

Directing her aim at both Starmer and Corbyn, she asked aloud why Labour can’t find a leader who lives outside of north London, home of the metropolitan elite. She also wondered why there had been no female Labour Party leaders (video):

After PMQs ended, Guido said that Liz’s Cabinet was more diverse than Labour’s shadow team, although you cannot see that in the photo that he posted. He calculated:

… up to seven BAME members: 23% of the total. 

By Guido’s reckoning, Labour’s shadow cabinet has six ethnic minority members, or a mere 20%.

Meanwhile, Labour continue thrashing the Tories on gender and state school educations. All completely irrelevant, but nonetheless, interesting to note …

That evening, The Telegraph analysed Liz’s first full day as PM.

Madeline Grant provided a sketch of PMQs:

Therese Coffey, radiating gung-ho enthusiasm, looked ready to crack out another celebratory cigar. A dazed Suella Braverman wandered into the Chamber via the Westminster Hall route used by most MPs, then remembered she is Home Secretary now and hot-footed it to the “VIP entrance” at the back.

Notable by their absence were Rishi Sunak, and, predictably, Boris Johnson, though Sajid Javid was there …

A huge roar enveloped Liz Truss as she sashayed in, looking sleek in a blue pantsuit – shades of Keeley Hawes in the Bodyguard. The Tory troops, clearly desperate for things to go well, cheered raucously no matter what she said or did. Yet again beating Labour in the identity politics stakes seemed to have sparked particular joy. When Sir Keir Starmer congratulated Truss on her appointment, a Tory backbencher snarled “3-nil!”. James Cleverly, the Foreign Secretary, brandished three fingers and jabbed them in the air.

Theresa May also congratulated Truss on becoming Britain’s third female prime minister. “Why does she think it is that all three female prime ministers have been Conservative?”, she asked. Truss positively beamed at her. “I look forward to calling on her advice,” she said. (Oh no).

“There does seem to be an extraordinary inability of the Labour Party to find a female leader,” continued Truss, “or indeed a leader who doesn’t come from north London.” The Tory hordes roared at this, and even Starmer repressed a chuckle.

Her presentation was as wooden as ever:

But her replies were assured, refreshingly direct. There were even a few one-word answers – no to a windfall tax, for instance – a quasi-mythical event in Westminster. It was almost as if the sphinx was at the despatch box. All of this seemed to flummox Keir Starmer, who is more used to spending PMQs trying to prise answers out of Boris Johnson – occasionally wincing as if pulling out his own teeth with a pair of rusty pliers.

Truss’s true-blue rhetoric seemed to bring out Starmer’s inner Corbyn too. He railed against “excess profits” with the wild-eyed conviction of a politburo member sounding off about Kulaks. “Same old Tories… There is nothing new about the Tory fantasy of trickle-down economics”, he scoffed.

The Times‘s Quentin Letts noted Liz’s calm demeanour:

The Tory benches mooed when they saw her but once Truss started answering questions, the composure was striking. Most of all it was the slower pace that one noticed, and the evaporation of most of the performance-venom that tarnished the late Johnson era. Where Boris used to gabble, Truss spoke slowly. The voice, which seems to emanate from near the tip of her nose, was clear. It may pink a little, like a novice musician’s recorder, but it is strong enough to cut through a full Commons

Truss referred to “my chancellor” and “my new health secretary”. She was asserting her power. There wasn’t a quiver visible in her fingers and she maintained a consistent tempo, andante rather than allegretto. Talking slowly makes you sound more authoritative and means you need not say so much. Helen Hayes (Lab, Dulwich & West Norwood) essayed a zinger. Would the government’s response to some report be published by the end of the year? “Yes,” said Truss, and she slowly, serenely resumed her seat, suffused with calmness. One should not over-interpret this performance. PMQs debuts usually go well. But the story is not quite conforming to the catastrophists’ narrative.

Returning to The Telegraph‘s articles, Daniel Martin told us that Liz wanted proper dress in Downing Street:

The Prime Minister has made it clear she wants to re-introduce a dress code, with officials told to wear shirts and ties as part of a new, more formal style of government

One government source said Ms Truss had made her views plain when she arrived back to Admiralty House from her victory party in the City of London, the night before she became Prime Minister.

The source said: “This is all born from Liz coming back from winning and telling the staff in Admiralty House that ties were back.”

We also found out that she wanted a leaner operation:

Ms Truss has also ordered a wider operational shake-up at Downing Street, including a new economic unit whose role is to help her take on “Treasury orthodoxy”.

She has brought in Matthew Sinclair, the former director of the TaxPayers’ Alliance, as her chief economic adviser …

In a bid to strengthen the relationship between Ms Truss and her most important ministers, new offices are being created in Downing Street for both Wendy Morton, the new chief whip, and Thérèse Coffey, the Deputy Prime Minister.

An aide told The Spectator: “We’ve blown up the No 10 floor plan”, saying the idea is to create a leaner, nimbler operation.

Allister Heath was fully behind Liz and her plans:

I’m optimistic about the Truss Government. Yes, of course, nobody can possibly know how well it will do – whether it will outwit the Blob to push through genuine improvements. But it is absurd to state, almost as self-evident fact, that it is bound to collapse, that it cannot last even two years, based in part on an insulting dismissal of the credibility and intellect of all of the members of the new Government.

It is astonishing that pundits with no understanding of economics dismiss the Prime Minister’s ability in this area: she actually worked as an economist for Shell (ideal in the current climate) and as an economic director for Cable and Wireless. The first accountant ever in No 10 – she holds the qualification from the Chartered Institute of Management Accountants – she is more financially literate and comfortable with complex policy matters than almost all of those who patronise her. The fact that she is reflexively written off as lightweight, a dilettante even, is more a reflection of the bizarrely misogynistic and classist minds of some of her more extreme critics than of any objective reality.

Kwasi Kwarteng, the Chancellor, holds a PhD in economic history from Cambridge, perhaps the ideal qualification for the moment; his War and Gold and Ghosts of Empire remain timely. Thérèse Coffey, Truss’s deputy, is another PhD: in her case, in chemistry, showing how much more intelligent she is than the ignoramuses who hate her.

Suella Braverman, the Home Secretary, is an extremely competent, bright and personable lawyer who drives the Left crazy. Kemi Badenoch holds degrees in engineering and law, and is fiendishly clever. Jacob Rees-Mogg, with his background in finance, is the perfect pick for Business (and Energy), given the technical and intellectual complexity of his mission. Kit Malthouse, the Education Secretary, another accountant, has experience running a medium-sized business; Chris Philp, the Chief Secretary, has a degree in physics.

The list goes on. Of course, some ministers are weaker than others, but the average quality is a great improvement on many past governments. Matthew Sinclair, one of Truss’s advisers, is the best free-market economist of his generation in Britain today.

The paradox is that it is a policy that I’m uncomfortable with that is likely to send the Government’s poll ratings surging, discrediting its Leftist critics. Truss’s energy plan is rightly a big bazooka; it is regrettable that, for a variety of practical and political reasons, she appears to have decided to freeze all energy bills, rather than to opt for targeted subsidies to small firms and the bottom half of earners. The Government’s bill will be at least 5 per cent of GDP, with enormous potential liabilities. This is the biggest welfare programme in British history, one that helps the well-off as much as the needy.

But we are where we are. The Government felt that an alternative, non-universal plan could not be targeted correctly, that the cliff-edge from means testing would be too extreme, that the public’s allergy to high prices had become too toxic. Truss feared she would be destroyed on arrival if she didn’t go for broke. Her gambit is that the scale of this intervention will cripple the Left: it’s a statist umbrella protecting her free-market reforms

Our new Prime Minister likes economic growth, not merely because she values material prosperity, but because she buys into the very idea of progress, of improvement. Boris Johnson agreed in theory, but didn’t understand what to do. Unlike Theresa May, Truss is inherently anti-Malthusian: her Chancellor talks of growing the economy, rather than arguing about how to redistribute a stagnant pie, the vanishing “proceeds of growth” taken for granted by David Cameron.

Yes, Truss will address our immediate crisis via costly, short-term policies. But she’s deadly serious about principled long-term measures to accelerate the economy by boosting energy output, housebuilding, private investment, scientific innovation and entrepreneurship. It will be tough, but the Twitter Lefties are entirely wrong to be betting so emphatically against her.

The Telegraph‘s main editorial compared her to Margaret Thatcher:

Opinion polls indicate that Labour’s windfall levy is popular, but Ms Truss is right to identify the flaws in this approach. Her declaration that we cannot tax our way to higher growth could have been uttered by the first woman prime minister 30 years ago.

Balancing short-term expediency with long-term economic requirements will require skill and determination. Ms Truss has set out her position and is clearly intent on sticking to her guns, even if the polls are tempting her to abandon them. It was an encouraging start.

The Mail provided us with short takes from the more left-of-centre broadcasters, who also thought Liz did a great job at PMQs. These were not her natural allies.

The BBC’s Chris Mason noted:

As Prime Minister’s Questions finished, there appeared to be a warm, one-on-one brief chat between Liz Truss and Keir Starmer.

I think Starmer said “well done” to his opponent: all party leaders regularly acknowledge that PMQs is a tough gig

It felt less personal, much less theatrical and more ideological …

TalkTV’s Tom Newton Dunn said:

Liz Truss is not a legendary orator, and some Tory MPs lived in terror at the thought of her robotic despatch box style.

But that was a very strong debut

The Mail had several more comments, so I will end with this one from the i newspaper’s Richard Vaughan:

If Liz Truss’s aim for her first PMQs was to kill the usual heat and rancour in the Commons chamber, then she succeeded. It was a solid, no-frills performance.

… Ms Truss’s arrival onto the front bench was greeted with cheers, but it was by no means a deafening welcome by backbenchers to their new leader – perhaps a portent of things to come.

On the evidence of her no-nonsense opening appearance in her new role, they would be wise not to underestimate her. Her next trick will be to try and inspire those on the benches behind her.

Aye, there’s the rub.

To be continued tomorrow.

As I need something positive to think about while awaiting Chancellor Jeremy Hunt’s awful budget on Thursday, November 17, here is a retrospective on Liz Truss’s rise to power, however short-lived.

The Conservative Party leadership campaign dominated the latter half of July and all of August.

By Tuesday, August 16, like the Telegraph‘s Tim Stanley, I, too, had watched every hustings up to that point.

Who could have guessed that, in an extraordinary turn of events, both she and Rishi Sunak would be in No. 10 within weeks of each other?

Reporting on what happened north of the border in Perth, Stanley wrote:

The hustings had become so repetitive, I know the speeches by rote. Rishi grew up in a pharmacy, Liz sat on a planning committee. My only pleasure has been waiting for the day they cross their wires and Rishi announces he grew up on a planning committee and Liz that she sat on a pharmacy.

But on Tuesday we were in Scotland, so the script was rewritten. Lots of references to whisky, gas and Nicola Sturgeon, who Liz once said we should ignore, so Rishi said: “I don’t just want to ignore [her], I want to take her on and beat her!” Big clap for that …

“I grew up in a small business,” he said. And the cream for your burn, sir, can be found on the fourth aisle.

Liz did a much better job of showing that she knew she was in Scotland, referencing Adam Smith, JK Rowling and salmon fishing – and reminding us that she understood what poverty was because she grew up in a recession in Paisley in the 1980s (when the Tories were in power) and later in Leeds in the 1990s (ditto). 

In fairness to Liz, she meant local councils, not the Government.

The Mail highlighted the disagreement Liz and Rishi had on taxes:

Miss Truss has pledged to reverse the national insurance hike to help struggling families, but has not ruled out offering further support. But Mr Sunak said the right way to help people with higher energy bills is through direct support.

He told the hustings: ‘The tax cuts that Liz is proposing are worth about £1,700 to someone on her income. For someone working very hard on the national living wage, it’s worth about a quid a week …’

On Wednesday, August 17, the duo were in Northern Ireland, where, yes, there is a Conservative Party. It has around 600 members. I had no idea.

The Guardian had unearthed an old video of her saying that the British weren’t very good workers. The Mail said that she defended her remarks to the press in Northern Ireland:

Pressed by reporters in Northern Ireland today whether she believes British workers are not working hard enough, Ms Truss replied: ‘What I believe is that we need more skills in our country, we need more capital investment in our country, we need more opportunity in our country. That is what I would deliver as prime minister …

She added : ‘I’m fundamentally on the side of people who work hard, who do the right thing. Those are the people I want back.’

Conservatives did not object to Liz’s views (emphases mine):

Despite the furore, Ms Truss was delivered a major boost today with the latest ConservativeHome poll showing she is firmly on track for victory on September 5. She was 60 per cent to 28 per cent ahead of Rishi Sunak in a survey of activists.

The Belfast hustings was the only uncomfortable one of the campaign. It was clear neither candidate had any grasp of Northern Ireland or people’s concerns:

The furthest Liz could connect with the small group of Conservative members was to say that she knew that a ‘woman is a woman’, for which she received applause (somewhere around the 12-minute mark). Near the end of her Q&A, a man expressed concern about abortion, which was foisted on them by Westminster. He asked about the fairness of that, since Northern Ireland has its own Assembly. She bristled at the question and brusquely replied that all the devolved nations had to have the same health policies (somewhere between 32 and 35 minutes in).

Rishi’s intro and Q&A followed Liz’s.

The London Evening Standard had an excellent report from Rebecca Black following the hustings at the Culloden Hotel on the outskirts of Belfast:

The Brexit protocol, the Stormont Assembly, the health service, abortion, foreign policy and support for the party in Northern Ireland were among the issues raised …

Martin Craigs said he remained undecided after hearing their pitches.

He said he felt their content in terms of Northern Ireland had been “very weak”.

“They’re sitting on the fence, this isn’t the audience they’re playing to, the audience they’re playing to are the 160,000 Conservative members, and there are very few of them in Northern Ireland, but they obviously have to go to all corners of the UK to be seen to be democratic,” he told the PA news agency.

“I might actually not vote at all because I think the performance has been so poor.”

Matthew Robinson, chairman of the Northern Ireland Conservatives, welcomed the candidates’ visit and paid tribute to the commitment they were showing to the region.

He said he had been holding back on deciding who to vote for, but based on what he heard at the hustings he would back Ms Truss.

“I think she outlined an unwavering commitment to what we do locally here as a political force,” he said.

“I’m not just encouraged but excited about what we can achieve together during her hopeful premiership.”

David Trimble’s widow said that, just before he died, he wanted to make sure he voted for Liz. Lord Trimble had originally been a member of the Ulster Unionist Party (UUP) but became a Conservative in 2007. The following year, a voting alliance was created between the UUP and Conservatives in Northern Ireland.

The Standard reported on Lady Trimble’s article in the Telegraph in which she supported Liz. The Stormont Assembly has not been meeting for several months now:

The powersharing structures Lord Trimble helped create in the landmark 1998 agreement are currently in limbo, with the DUP blocking the creation of a governing executive in protest at Brexit’s Northern Ireland Protocol.

Lady Trimble wrote: “I believe that in this contest, Liz Truss has the best record and a viable plan to protect our Union and Northern Ireland’s integral place within it.

“I know David thought the same.

“One of the last things he did before we lost him was to ask his son to collect his voting papers so he could vote for Liz.

“He was adamant that she was what the country needed and I agree.

“She has already proven her resolve and bravery in the face of opposition to our most valuable asset, and I am confident that my husband’s legacy, peace in Northern Ireland, will be safe with her.”

Lady Trimble, born Daphne Orr, is an academic who served as a member of the Equality Commission for Northern Ireland and the Northern Ireland Human Rights Commission.

Another article in the Standard showed that Liz understood the difficulty with the post-Brexit Protocol:

The Foreign Secretary also said she would not accept any compromises on a renegotiated Northern Ireland Protocol as prime minister if it meant key UK demands were not met.

She made the comments during a visit to Belfast, where she and Rishi Sunak were quizzed by Tory members during a hustings event.

She told party members that until the Northern Ireland Protocol is sorted, Stormont will not be back up and running.

The Standard‘s Rebecca Black wrote a separate article on the abortion question:

Abortion laws in the region were liberalised in 2019 in laws passed by Westminster at a time when the power-sharing government at Stormont had collapsed.

During a Conservative Party leadership hustings event at the Culloden Hotel on the outskirts of Belfast, Ms Truss was asked if she would abolish abortion in Northern Ireland, “ending infanticide”, or let the people of the region have their say on the issue.

She responded to applause [for the man, not her]: “I’m afraid I don’t agree with you.

“We are a United Kingdom and we need all of our laws to apply right across the United Kingdom – that is what being a union is.”

Rishi’s highlight of the hustings was about Liz’s £50 billion black hole:

Rishi Sunak has warned that Tory leadership rival Liz Truss’s tax plans would add £50 billion to borrowing while failing to give direct support to the most vulnerable in society, as the cost-of-living crisis deepened.

The former chancellor said the Foreign Secretary would be guilty of “moral failure” if she does not focus on the nation’s poorest, and warned her policies could further stoke inflation.

Ms Truss instead insisted “taxes are too high and they are potentially choking off growth”, as she promised an emergency budget to tackle the situation.

On Thursday, August 18, the eminently sensible Lord Moylan told GB News that he was voting for Liz because Rishi’s economic plans did not make sense:

On Saturday, August 20, Sir John Redwood MP criticised the pro-Rishi media:

Redwood laid out his Thatcherite economic plan for Liz in that day’s Telegraph:

Britain’s fiscal rules should be ripped up by Liz Truss if she wins the Conservative leadership race, one of her key allies has said.

Sir John Redwood, who served as the head of Margaret Thatcher’s Downing Street policy unit and is tipped to return to government if Ms Truss wins, said she should abandon the practice of targeting a set percentage of GDP for national debt and the deficit.

He also called for a review of both the Bank of England and Office for Budget Responsibility (OBR), and suggested the Foreign Secretary should be inspired by Mrs Thatcher in removing utilities and transport from state control.

Since 1997, fiscal rules have been announced by chancellors during Budget statements in an attempt to control government spending.

They usually set a restriction on the proportion of national debt or deficit as a percentage of economic output.

But in an interview with The Telegraph, Sir John said the practice is a hangover from EU fiscal regulation agreed between member states at the Maastricht conference in 1992, and does not encourage economic growth or limit inflation.

“I think having a fiscal rule, which is a variant of state debt as a percentage of GDP, and the public deficit as a percentage of GDP in any given year, is not really the right couple of rules for the two targets you’re trying to meet,” he said.

The Tory backbencher said ministers should maintain “sensible controls over growth in public spending and in public debt” by instead monitoring the amount of money paid by the Treasury to lenders in interest payments.

In a coded rebuke to Rishi Sunak, who was the chancellor until last month, he added: “You have to elect governments that take controlling public finances seriously, and they then have to take them seriously.

“If you have a government that doesn’t take controlling public finances seriously, it won’t matter what your fiscal rules say, as we know from recent past experience,” he said.

Sir John is expected to be appointed as a Treasury minister in Ms Truss’s government and is understood to have helped shape her thinking on economic issues during the campaign

Sir John said he had not had “any discussions” with Ms Truss about taking a role if she wins the contest, but told The Telegraph he would accept a job if he was offered one.

The Times also thought that Liz would give Redwood a role. One campaign source said:

“There are a lot of crumpled up bits of paper. I’ve been in three meetings about the cabinet and it keeps changing.”

Among the names on the pieces of paper: Iain Duncan Smith, who is heading back to cabinet, and John Redwood, who was last a minister 27 years ago and is earmarked for a junior Treasury post.

This weekend Truss will take a team of her senior aides to Chevening, the grace and favour home in Kent which she enjoys as foreign secretary, with the aim of getting people and policies more firmly nailed down.

In the past few days she has repeatedly told her team “no complacency”. As an ally puts it more prosaically: “No f***-ups, basically.”

Sadly, Liz never offered Redwood a role. If she had, she might still be Prime Minister today.

The Times was also wrong about Iain Duncan Smith, who was not part of Liz’s Cabinet, either.

Also on August 20, the Mail‘s Dan Hodges wrote that Rishi’s campaign was effectively over because of his mansplaining:

It was the moment Rishi Sunak‘s leadership campaign started to unravel. Actually, it was one of 20 moments. ‘Please let me respond,’ Liz Truss chided, as her opponent butted in during their first head- to-head TV debate. ‘Absolutely, let Liz Truss respond,’ the BBC‘s moderator Sophie Raworth was forced to interject.

Sunak didn’t. Time and again he talked over his rival, interrupting and silencing her. It was a strategy his team seemed to think would put Truss on the defensive.

They were wrong

the damage was done. Sunak was branded a ‘Mansplainer’.

To some, this episode provided further evidence of Sunak’s poor political tradecraft. But he’d actually fallen into a well-prepared trap.

‘We were ready for him!’ one Truss campaign ally told me. ‘For years, Liz has been patronised by men who are a bit full of themselves. She’s not going to just stand there and take it.’

In 15 days’ time, Britain will have our third woman Prime Minister. And unlike her predecessors, Liz Truss isn’t going to be shy of reminding people of it.

Let us recall that only the Conservatives have had female Party leaders, all of whom were Prime Minister.

By contrast, Labour have yet to elect a woman leader.

On August 21, The Sunday Times told us what Labour-to-Conservative voters in Oldham thought of the two candidates:

If Rishi Sunak (the ferret) and Liz Truss (the budgie) had put a glass to the wall of the room in Oldham where ten swing voters gathered by Public First, all of whom voted Conservative in the last general election, were sharing their impressions of the Tory leadership hopefuls, they would have blushed. But mostly not with pride.

They had been asked to say which animal, item of clothing or single word would best describe each of the candidates (Truss was also a “bunny rabbit”, for the record). As someone who has posed for photos atop a tank and astride a motorbike during her cabinet career, she might have been surprised to hear herself described as “mumsy”, “dull as dishwater”, a “cardigan”, “Jemima Puddle-Duck” and, possibly worst of all, an “unknown”.

Sunak would have heard that he was a “suit” a “backstabber” and a “traitor” (to Boris Johnson, that is) and he would have certainly regretted wearing a pair of £490 suede Prada shoes to visit a Teesside building site as he did last month. This did not go down well at all with many of these C2DE (aka working class) voters. It suggested, said Rachel, 33, a bar worker, that he was so rich he had “no respect for money”; after all a building site, she said, is going to be messy. She said “quite a lot of people were upset” by it, especially those struggling to make ends meet. “I certainly couldn’t afford to buy a £500 pair of shoes,” she said.

Matthew, 40, who works in the oil trade, asked how Sunak could possibly relate to low-wage people. The group wondered what his PR advisers were thinking, allowing it to happen. It was quite simple, said Mandy, an educator in a prison: “If you are going to an area where . . . people are on the minimum wage, don’t wear £500 shoes.”

But there was happier news for Sunak when it came to which of the two leadership candidates they preferred. Five chose Sunak, compared with three for Truss while two didn’t know, though by the end of the discussion a couple had changed to “don’t know”.

Sunak, according to those who picked him, had a higher profile due to the furlough scheme during lockdown. Jodie, 33, a school administrator, said she associated him with helping people during that period. “I had never heard of Liz Truss before this race, but Rishi Sunak . . . we’ve seen him in action. He’s helped out, like, working class people.”

Mandy, however, who chose Truss, said the foreign secretary had been growing as a force in the “background” for some time now. She mentioned the “scandals” involving Sunak. This was a reference to a recent video in which he boasted to Conservative party members in Kent of taking money from deprived urban areas in order to give it to other parts of the country

That day, Guido Fawkes revealed that Rishi’s team broke down Liz’s £50 billion black hole, which is actually tax savings.

Even now, with Thursday’s Rishi-Hunt budget in view, Guido still appears to be correct in his assessment:

Guido also thought that the Conservatives would win the next general election:

Guido’s post has Rishi’s breakdown of Liz’s black hole. This is Guido’s analysis of Liz’s savings for the taxpayer (emphases his):

According to figures just released by the Rishi campaign, taxpayers will get a net saving of £48.3 billion in reduced taxes under Liz as Prime Minister compared to Rishi. This is a similar figure to calculations made by the Guardian newspaper. This is intended to be an attack line, the argument Rishi is making is that Liz will have to choose between tax cuts or handouts. When you consider that this is equivalent to some £2,000 per taxpayer you will understand what Liz means when she says she wants to “help people in a Conservative way”

In the Rishi campaign’s press release the tax savings are described as “costs”. This approach hasn’t been seen since 2010, when Gordon Brown would point to any tax saving proposed by the opposition and demand to know from Cameron and Osborne what spending would be cut. It is a mindset that considers the public’s money to belong to the government and any income not taxed to be a “cost”. Guido’s not sure why Liam Booth-Smith, Rishi’s policy guru, ever thought this orthodox Brownian line of attack would appeal to Tory members…

By Monday, August 22, with a week and a half left to go in the seemingly endless campaign, Rishi’s poll ratings were tanking.

The Guardian warned that Labour found that Liz could boost the Conservatives in the polls, which Labour had been leading for several months by that point. They still are in the lead.

However, the paper said that any poll boost would be short lived:

Tory leadership frontrunner Liz Truss could give the government a double-figure bounce in the polls once she is installed in No 10, according to internal Labour analysis.

A memo drawn up by Keir Starmer’s director of strategy, Deborah Mattinson, claimed the foreign secretary could dramatically improve Conservative fortunes.

The document, dated 18 August and leaked to the Guardian, comes amid speculation that Truss could be tempted to capitalise on the upswing and call a snap general election.

However, the research also suggests that any improvement in the government’s position could be very short-lived, with voters already concerned about aspects of Truss’s character.

“Our focus groups suggest that as voters get to know Truss better they like her less,” it says. “Serious negatives – untrustworthiness, inauthenticity, U-turns, lack of grip – are starting to cut through suggesting that any bounce may be very short-lived.”

Meanwhile, Rishi allegedly scoffed at the idea he would take a post in Liz’s Cabinet. That day, The Times reported on his interview with BBC Radio 2:

Truss has said that she would offer Sunak a cabinet job if she were to win. The Times reported at the weekend that she is considering asking him to become health secretary.

Sunak appeared to scoff at the prospect today, however, suggesting he did not want to serve in a cabinet in which he and the prime minister would disagree on “the big things”.

Liz’s poll results were buoyant. An Italian firm, Techne, cut their teeth in the UK on this campaign:

In the end, the result was much closer, although Liz still had a clear majority.

However, on the same day, a GB News Peoples Poll (Peoples Poll being the name of the polling organisation) showed that Britons overwhelmingly prefer Labour’s Keir Starmer as the next Prime Minister, viewing Liz Truss as ‘untrustworthy’:

A poll exclusively commissioned by GB News has found that British people would prefer Keir Starmer to be Prime Minister over both Rishi Sunak and Liz Truss.

41 percent of the 1,235 Brits polled said they would be more likely to vote for a Labour Party led by Keir Starmer than the Conservatives led by Liz Truss, who received 22 percent of the vote.

And Rishi Sunak, also standing to become the next Tory leader and Prime Minister, only fared one percent better than Ms Truss when compared with Sir Keir, who received a share of 40 percent of the poll.

In both cases, 28 percent of people said they didn’t know who they would prefer, with nine percent preferring not to say.

The results raise questions about the popularity of both candidates, with the Conservatives faring better in a straight contest with Labour.

When asked which party they would vote for if there was a General Election tomorrow, Labour came out on top with 31 percent.

But the margin between the two parties was a lot smaller than between the leaders, with 20 percent voting Conservative

When asked to give one word they associated with Liz Truss, Brits’ top answer was “untrustworthy”.

Unfortunately for Ms Truss, second most popular answer was “useless”, with the even less flattering “idiot” in third.

On Monday, August 29, the anti-Liz media went into a tizz when she declined an interview with the BBC’s Nick Robinson.

The Telegraph reported:

Liz Truss has pulled out of a BBC interview with Nick Robinson because she can “no longer spare the time”.

Ms Truss, the Tory leadership front-runner, committed to the primetime sit-down interview with Mr Robinson, who presents the Today programme, on Aug 18.

But the Foreign Secretary now appears to have changed her mind as the race to succeed Boris Johnson enters its final week. Rishi Sunak, her leadership rival, was interviewed by Mr Robinson on Aug 10 …

Mr Sunak has taken part in nine one-on-one broadcast interviews throughout the leadership campaign, including three appearances on the Today programme.

Ms Truss has done two such interviews, including the Today programme, when she was interviewed at the start of the head-to-head stage of the contest, and the People’s Forum show on GB News.

A bigger controversy that day was that Liz was preparing to cut VAT. She never did, but someone should, because VAT is an EU law. Here is smoked salmon king Lance Forman’s wise opinion, saying that the people who object to a VAT cut are on the Left:

On the penultimate day of Conservative Party member voting, Liz pledged to revive Conservative grassroots activism, but readers of ConservativeHome were unimpressed.

One of the comments read:

This and other similar pieces of rhetoric just prove to me that it’s all about strategies to win elections rather than a coherent, well thought-out set of policies that will benefit the country in both the short- and long-term, much the same as some of the statements made by both candidates in this “leadership” election.

Surely we are capable of better?

Yes, we are capable of better.

On the last day of members voting, Wednesday, August 31, The Telegraph asked readers who should be in and out of Liz’s Cabinet.

Interestingly, everyone the readers wanted out are in Rishi Sunak’s Cabinet. Priti Patel is the only exception. And, Alok Sharma is still COP26 president, although he is not in Cabinet.

In conclusion, within weeks, we went back to the same old, same old thing.

I still have a few more items about Liz Truss to cover. Stay tuned.

On Thursday night, November 10, 2022, Liz Truss’s Chancellor, Kwasi Kwarteng, broke his silence in an interview with TalkTV’s Tom Newton Dunn on First Edition.

He and Truss disagreed on how quickly to move on the economy.

Background

Looking back at that period of mourning for the late Queen when Truss assumed office, the nation had been jittery over the cost of living crisis.

The Conservative leadership contest, which had lasted several weeks, put paid to any constructive solutions to the problem in the latter half of the summer.

Furthermore, Parliament had been in its customary weeks-long recess at that time.

During that period, energy prices were forecasted to be at a crippling high. Every news outlet was full of articles and broadcasts on the choice between food or fuel.

People wanted Parliament to be recalled because ‘something must be done’.

A general election is also coming up in two years’ time, therefore, Truss wanted to hit the ground running and make up for the two-and-a-half years lost with the pandemic.

Hence Truss’s ambitious and, to use her word, bold economic plan.

Kwasi explains

Tom Newton Dunn wrote up highlights in The Times of what Kwarteng told him (emphases mine):

In his first interview since being sacked as chancellor, Kwarteng told TalkTV that he had advised Truss to “slow down” and take a “methodical and strategic approach” to boosting growth as prime minister …

In the interview with First Edition, Kwarteng also revealed that Truss was “distressed and emotional” when she summoned him to be sacked days before she was forced from Downing Street.

He said he told her during their meeting that she was “mad” to fire him, adding: “People will ask, ‘If you sacked the person who was doing what you wanted, why are you still there?’”

Which is exactly what happened. The Sun‘s Harry Cole asked that very question at Truss’s press conference that fateful day, Friday, October 14. Truss thought that Cole would be more empathetic, as The Sun generally supports the Government.

Whilst unapologetic for his economic plan, the former Chancellor did say that lessons had been learned:

Kwarteng repeatedly refused to apologise for pursuing the principle of the pair’s economic agenda and warned Rishi Sunak that he could not “simply keep putting up taxes”.

He said that he had had reservations about the scale of the planned tax cuts in his mini-budget, especially as there were no accompanying plans to reduce government spending. “The prime minister was very much of the view that we needed to seize the opportunity and we hit the ground running,” he said. “She’s very dynamic, very forceful. That’s a great strength. But I think you had to have a measured approach, especially doing the things that were radical, that were bold. And that’s the lesson that we’ve learnt.”

Asked who controlled the timetable of the mini-budget, Kwarteng said that he bore “some responsibility for it” but added: “I think the prime minister was very much of the view that we needed to move things fast. But I think it was too quick. If you look at it, it was on the 23rd of September. We only got into the office on the 6th of September. And looking back I think a measured pace would have been much better.”

Kwarteng said that afterwards he confronted Truss and warned her the government could fall unless she slowed down. “After the mini-budget we were going at breakneck speed and I said, you know, we should slow down, slow down. She said, ‘Well, I’ve only got two years’ and I said, ‘You will have two months if you carry on like this’. And that is, I’m afraid, what happened.”

He also said:

She was very emotional. I can’t remember whether she was actually shedding tears but she was very emotional and it was a difficult thing to do. I think she genuinely thought that that was the right thing to buy her more time to set her premiership on the right path. I disagreed, obviously. I thought that if chancellors are sacked by the prime minister for doing what the prime minister campaigned on, that leaves the prime minister in a very weak position.

Kwarteng revealed that he found out he was being sacked by reading a tweet from a Times journalist:

… a tweet from The Times’ political editor as he drove to a meeting with Truss in Downing Street.

As King Charles said to Truss only a month ago — and just days before she sacked her Chancellor:

Dear, oh dear.

Kwarteng is supportive of Prime Minister Rishi Sunak but says that he and Chancellor Jeremy Hunt should not put the blame for a cratering economy on him and Truss:

Kwarteng praised Sunak as a “very credible prime minister” but said he and the new chancellor, Jeremy Hunt, should not attempt to blame him and Truss for all the government’s current problems. “The only thing that they could possibly blame us for is the interest rates and interest rates have come down and the gilt rates have come down. I mean, it wasn’t that the national debt was created by Liz Truss’s 44 days in government.”

He added that although he accepted that taxes would need to rise in the short term, the government still needed a growth strategy. “You’re not going to grow an economy or incentivise economic growth by putting up our taxes,” he said.

True. I wrote earlier this week about why the Truss-Kwarteng plan was the correct one for the UK.

Kwarteng and Truss have known each other for years and live near each other in Greenwich.

He says they are ‘still friends’, but:

he had still not returned a missed call from her two days ago. “I will call her back,” he said.

The BBC’s analysis

In an analysis of the interview, the BBC points out that, at the time of the mini-budget, Kwarteng promised more tax cuts to come:

During his time as chancellor, he repeatedly advocated measures of the sort set out in the mini-budget, and two days after delivering it told the BBC there was “more to come” in the way of tax cuts.

The comment, along with a decision to announce the mini-budget without publishing an assessment by the government’s fiscal watchdog, was later seen as key to convincing investors that the government did not have a credible plan to keep debt levels under control.

Did Kwarteng reveal too much in the interview?

He insists that he remains friends with Ms Truss. But in this interview he does reveal elements of private conversations during his sacking that Ms Truss may well have preferred had stayed within the walls of Downing Street.

He once toured TV studios insisting she would make a great prime minister. It doesn’t feel like they’re on as good terms now as they once were.

And what next for Mr Kwarteng? It doesn’t sound like he’s going to be an awkward backbencher: he’s pledging complete loyalty to Rishi Sunak.

There was lots of detail in this interview, but it’s important to remember that this is only one side of the events that took place as Ms Truss’s premiership began to crumble. When will she break her silence?

Jeremy Hunt’s tactful comments

On Friday, November 11, the new Chancellor reacted to Kwarteng’s interview.

The Guardian reported:

Good morning. We’ve got less than a week to go now until the autumn statement – in effect, the second budget of the autumn – and already a blame game has broken out in the Conservative party about who is responsible for the massive spending cuts and tax rises the nation is about to face.

Kwarteng had denied there is a black hole in the nation’s finances:

The national debt wasn’t radically changed by Liz Truss … There isn’t a black hole and the interest rates and the gilt rate funding the debt is exactly the same as it was before the mini-budget. So the black hole hasn’t been caused by the mini budget. It’s something that Jeremy and Rishi and their officials are going to have to tackle on their own regardless of what happened in the budget.

However, on Sky News, Jeremy Hunt pushed back on Kwarteng’s claim:

All I would say is that when we produced a fiscal statement that didn’t show how we were going to bring our debts down over the medium term, the markets reacted very badly and so we have learned that you can’t fund either spending or borrowing without showing how you are going to pay for it and that is what I will do.

The Guardian concludes:

Hunt did not engage with Kwarteng’s specific argument, but he was clearly implying that his predecessor was at fault.

The article includes a clip from Hunt’s interview:

Hunt was giving an interview to respond to this morning’s growth figures showing the economy shrank by 0.2% in the third quarter of the year.

The Bank of England admits QE wrong policy

But wait, there’s more.

On Tuesday, November 8, the Bank of England (BoE) finally admitted that QE — quantitative easing — was a mistake during the pandemic.

This is where the real problem lies. It has nothing to do with Kwarteng or Truss.

The Daily Mail reported that the BoE’s chief economist, Huw Pill, appeared before the House of Lords economic affairs committee, admitting:

the Bank played a part in driving up inflation through its massive money-printing programme.

Known as quantitative easing (QE), this pumped £450billion into the economy during 2020.

He had more to say on inflation:

Pill also blamed the huge mismatch between supply and demand in the aftermath of Covid lockdowns for pushing the price of goods ever higher.

Pill has only been in his job for a year, so no one can blame him, but:

The comments could make uncomfortable reading for Bank Governor Andrew Bailey, who oversaw the explosion in QE, and new Prime Minister Rishi Sunak, who as chancellor was at the heart of the Government’s response to Covid.

The Government has been fond of blaming the war in Ukraine for our current problems, however:

even before Russia’s invasion of Ukraine in February, which caused gas prices to spike, inflation was already at 6.2 per cent – more than three times the Bank’s target of 2 per cent.

Rishi and the BoE are to blame for this. As Chancellor, Rishi told MPs that we could borrow, borrow, borrow during the pandemic at little to no cost.

However, Huw Pill sees things differently:

Gas prices do not ‘explain all of the overshoot’ in inflation, said Pill. One factor, he said, was ‘developments in the past – including choices over monetary policy’.

Warning that ‘QE and the choices over QE may have contributed’ to the rise in the cost of living, Pill added: ‘I was not at the Bank two or three years ago when some of those rounds of QE were undertaken. Whether those would be chosen to do now is an open question.’

He also suggested that lockdowns – and the support offered to households and businesses through the pandemic such as the furlough scheme – played a part as they boosted demand at a time when the supply of goods and services was severely hit.

‘Looking back at the impact of the pandemic, I think one can say that destruction of demand was over-emphasised relative to the destruction of supply,’ he said.

‘The support coming from the macroeconomic side – both fiscal support and monetary support –was very profound.’

QE works in the UK as follows:

buying bonds from investors – mainly government bonds known as gilts – reducing borrowing costs and freeing up cash for those investors to plough into the economy.

During the pandemic:

this helped to fuel demand by propping up buying activity while ignoring the supply problems caused by lockdowns, when businesses were forced to shut their doors.

When economies reopened, there was a surge in demand that could not be met, driving up prices and causing workers to demand higher wages.

Other economists and financial experts sounded the alarm at the time:

Andy Haldane, Pill’s predecessor at the Bank, predicted as much when he began warning early last year that inflation could get out of hand.

Delaying efforts to tame inflation would be like ‘trying to catch a tiger by its tail’, Haldane said.

But other members of the Bank of England’s interest rate-setting committee remained adamant that inflation would be ‘transient’.

The Bank only began to raise interest rates in an attempt to get a grip on inflation in December last year and has now raised them from 0.1 per cent to 3 per cent.

Gerard Lyons, chief economist at investment firm Netwealth and former economic adviser to Boris Johnson during his time as mayor of London, accused the Bank of making a ‘major policy mistake’ with QE.

And Sir Paul Marshall, a hedge fund veteran, compared QE with a drug to which markets had become ‘addicted’.

One week ago, sterling slumped as the BoE raised interest rates to 3%.

The Daily Mail reported:

Sterling slid around 2 per cent towards $1.11 as Andrew Bailey said markets were wrong to believe rates would peak as high as 5.25 per cent next year. 

His comments came as the Bank raised rates by a mammoth 0.75 percentage points to 3 per cent, the largest hike in more than 30 years. But in a warning to traders who were expecting more bumper hikes, Bailey suggested the unprecedented speed of rate hikes would soon begin to slow

There is internal disagreement among the BoE’s ninestrong Monetary Policy Committee (MPC). A vote had to be taken on the interest rate rise:

More splits emerged at the Bank of England as two members of its ratesetting Monetary Policy Committee ( M P C ) opposed the hike to 3 per cent. Swati Dhingra argued that interest rates should be raised by 0.5 percentage points to 2.75 per cent and Silvana Tenreyro voted for an increase of just 0.25 percentage points to 2.5 per cent. They were outvoted by the other seven members, who opted for a 0.75 percentage point rise. The split exposed the difficulty the Bank is having in navigating Britain through the economic storm. Dhingra said that ‘a small rate increase was warranted to safeguard against creating a deeper and longer recession’ in Britain. Tenreyro, meanwhile, said the rate rises seen already would bring inflation back below 2 per cent in due course.

Sterling hadn’t been that low since Kwarteng was Chancellor one month ago:

The pound slid by more than 2 per cent. Yesterday’s [last week’s] clash with traders again pulled down the value of sterling, which would usually rise on news of higher rates as traders shift to a currency promising greater returns. It is now at its lowest point since before Kwasi Kwarteng was sacked in mid-October following a disastrous six-week stint as Chancellor.

The US Federal Reserve has also affected sterling:

The pound has also been dragged down by the US Federal Reserve, which has been more aggressive than the Bank in its fight against inflation. The Fed has hiked rates by the unusually high amount of 0.75 percentage points at its last four meetings, taking its base rate to a range of 3.75 to 4 per cent and causing traders to flock to the dollar. While the Bank of England said its own base rate was unlikely to hit 5.25 per cent, it conceded it was also unlikely to remain at 3 per cent

Bailey said: ‘Where the truth is between the two, we’re not giving guidance on that.’ 

Analysts pointed out that more uncertainty lies ahead of Jeremy Hunt’s budget next Thursday, November 17:

Analysts said Threadneedle Street [where the BoE is] would be worrying about what other unpleasant surprises could be in store – especially regarding gas prices, which have been a key driver behind rising prices.

Philip Shaw, an economist at Investec, said rate-setters also had little idea what Chancellor Jeremy Hunt would announce in his Autumn Statement later this month, and whether there would be any further help for households which could fuel inflation.

Other economic news

More economic news came to light this week.

London

On November 10, Mayor of London Sadiq Khan told Times Radio that he has never been so worried about the capital:

I’ve lived in London my entire life; including the 80s during Thatcher’s reign and the recession. I’ve never known it so bad.

Really?

I had the good fortune of being in London three times in the past week: once in the afternoon and twice at night.

I have not seen so many people on the streets in the evening since before the pandemic. The streets were filled, especially with 20-somethings, giggling as they made their way to their various destinations. I saw no unhappiness.

The restaurants were full. The one my better half and I ate at this week was already booked for the next several weeks. The one we ate at last week started filling up from 5:30 onwards. It had plenty of students dining there.

Furthermore, the Tube was heaving with passengers. Maybe Sadiq Khan (Labour) needs to take the Underground now and again rather than his motorcade to see what’s really going on in London.

NHS — eye-watering costs

The NHS always wants more money: billions and billions more.

No one has got the nerve to reform its bloated ways.

Today, The Guardian reported that agency fees are spiralling out of control, yet Labour wants to give the NHS even more money if/when they get into Government:

NHS trusts are paying as much as £2,500 for a single agency nursing shift, research by the Labour party has revealed.

The party produced the figures by submitting freedom of information requests, and it says the results show the need for a big investment in NHS recruitment – which is what Labour is promising.

… A BBC investigation on the same topic found that, even though pay rates for agency staff are supposedly capped, these limits are regularly ignored, on the grounds that patient safety would otherwise be at risk.

Hmm.

Yesterday, the Daily Mail reported that the NHS will be curbing procedures such as tummy tucks and liposuction in order to save money.

An excellent idea. This should have been done years ago:

Circumcisions, tummy tucks and liposuction are among 13 operations which will stop being funded by the NHS in a ‘crackdown’ on wasteful spending.

It is thought that stopping the state funding of these operations could save £2 billon a year, along with less wasteful prescribing methods.

Last week bosses of the ailing NHS said that they want billions more cash to keep key services running this winter as Rishi Sunak ruled out cutting its budget as part of the public spending squeeze.

The £152 billion-per-year health service is seeking an extra £7 billion this year — the equivalent of an extra five per cent of its budget — to counter the effects of sky-high inflation, pay rises and Covid costs.

Finance chiefs warned that vital cancer, mental health and GP services face being axed unless the Treasury stumps up the cash.

Somehow, though, past efforts have not been proven money-savers:

It follows years of plans being drawn up to cut NHS costs.

In 2018, plans to stop funding breast reductions, tonsillectomies, and varicose vein surgeries were estimated to save the NHS £439 million a year, but in 2019 the spending had only dropped by three per cent in these areas, the newspaper reported.

Two years ago, 31 procedures were complied in a list in a plan to limit funding, including imaging for lower back pain. It is estimated that around 2.7 million procedures on the list were being carried out each year prior to this.

The new list, which includes circumcisions, tummy tucks and liposuction is the third that the NHS has made a bid to reduce costs.

The NHS will fund procedures on the list only if specific criteria are met:

Created by NHS bosses and medics from the Academy of Medical Royal Colleges, the plan states that the procedures should only be performed via NHS funding if specific criteria have been met …

The right-wing think tank The Policy Exchange estimates that this new guidance could save the NHS up to £2 billion.

Chairman of the Academy of Medical Royal Colleges, Professor Dame Helen Stokes-Lampard, told the newspaper: ‘In short, this programme is about making sure we don’t waste money doing things that don’t work and we are instead redirecting that cash towards those things that are proven to be beneficial.’

MPs’ ‘golden goodbyes’

The UK’s parliamentary constituency boundaries are being redrawn prior to the next general election.

As such, some MPs will lose their current constituencies, meaning they will stand to gain from ‘loss of office’ payments, or LOOPs.

The Daily Mail reported:

Rules on ‘golden goodbyes’ for MPs could be made more generous after a swathe of constituencies had their boundaries overhauled for the next election.

The Commons watchdog is looking at changing the provisions for politicians who are ejected from the House after it emerged very few could be entitled to cash.

Under the existing rules, departing MPs are only eligible for ‘Loss of Office’ payments – LOOP – if they have served at least two years and stood for re-election in the ‘same seat’. 

However, the extent of the boundary review – due to be finalised in the coming months – means that all but a handful of constituencies have either been redrawn, had their names changed, or both

LOOP is equivalent to two or three weeks’ salary for every year served, depending on age. For an MP on the core wage of £84,000 with 10 years’ service that would be worth between £30,000 and £50,000.

Similar rules apply to ‘winding up’ payments, which are equivalent to a lump sum of two months’ salary after tax and NICs [National Insurance Contributions] roughly £10,000.

The turnover of MPs could be particularly high at the election – potentially in 2024 – with Labour riding high in the polls.

Conclusion

Various news outlets have reported that the UK is in for six years of austerity, beginning with Hunt’s budget next Thursday.

Despite that, Rishi Sunak has just pledged billions in foreign aid — climate reparations — this week at COP27:

What about the folks back home?

What about Kwarteng’s £50m notional ‘black hole’ that the media and Labour have been crying about?

On Monday, Guido Fawkes’s sketch writer wrote about Sunak’s new commitments to apologise for … the advances the Industrial Revolution brought the world:

Not only was Little Rishi backed up in the speaking queue behind Iraq, Mozambique, Kenya, Tonga and the Congo – he had to listen to Barbados telling him to up his giving game. Billions? That was last year. Trillions are the new billions.

Other speakers pointed out that we in the rich world had failed to make good on our pledges for £100 billion in climate finance. In the new world order, we will fail to make good on our trillion-pound pledges and they’ll be a thousand times better off. “I profoundly believe it is the right thing to do,” he said. He heard none of us who were shouting at the screen.

He went on to tell the COP that Britain had been the first major economy to legislate for Net Zero. He suggested that it was our leadership that had raised the proportion of countries going for zero emissions from one third to 90%. That we were going to reduce our emissions by 68% by 2030. Not a shred of shame did he allow himself for any of this.

Are we one of the rich countries anymore? It seems odd that the Treasury is agonising over a £50 billion hole in this year’s budget and Rishi stood there offering the world £11.6 billion because of something we started 250 years ago.

Lance Forman, who runs his family’s smoked salmon business and was a Brexit Party MEP, also points out the radio silence surrounding Rishi’s pronouncements:

I can’t figure it out, either.

It must have something to do with being on the correct side of the Establishment.

On Tuesday, November 1, former Prime Minister Boris Johnson gave an exclusive interview on Ukraine to Sky News’s Mark Austin.

The video is here.

Boris gave the interview on the condition that it focused only on Ukraine.

The Daily Mail recapped the interview (emphases mine):

The former premier was speaking to Sky News when he was asked if he would like to return to the top role, and whether he had ‘unfinished business’.

‘You promised this was going to be about Ukraine,’ he said. ‘I harbour hopes of continuing to campaign for Ukraine and that is my priority.

‘There are various other things that I’m doing but that is of course very dear to my heart.’

I’m not as optimistic as Boris is about Putin’s holding back in Ukraine, so let’s hope our former PM is correct:

In the interview, Mr Johnson claimed Russia would be plunged into a ‘cryogenic economic freeze’ if Vladimir Putin launched a ‘crazy’ nuclear strike on Ukraine.

In a warning to the Russian President about the consequences of escalating his barbaric war, the former prime minister insisted Mr Putin would suffer a ‘total disaster’.

Mr Johnson told Sky News that Mr Putin would ‘immediately tender Russia’s resignation from the club of civilised nations’ if he used nuclear weapons.

He insisted the Russian President would be further isolated among global nations by losing the ‘tacit acquiesence’ of countries across Africa, South America and Asia, as well as the ‘patronage of the Chinese’.

The ex-PM also claimed Mr Putin’s launching of a nuclear strike would see ‘an absolutely hysterical reaction’ in Russia itself.

Mark Austin asked Boris if he hadn’t thrown away his most privileged opportunity to help Ukraine. Austin was talking about Partygate, which pressured Boris into resigning as Conservative Party leader and, as such, Prime Minister. Predictably, Boris gave him a bemused ‘What are you talking about?’ look, then said that his successor but one, Rishi Sunak, would carry on supporting the war-torn country. Boris also talked up the American aid being pledged, even if Republicans win the mid-terms this Tuesday.

With Boris on the backbenches now, Austin asked if he thought Rishi would give him a special role, perhaps as an envoy to Ukraine:

During the interview with Sky News, Mr Johnson was asked if he has spoken to Rishi Sunak about a ‘possible role’, with which he said: ‘What I can do and what I will want to do is to continue to champion the cause of Ukrainian freedom, of a free sovereign, independent Ukraine. It is a great cause. I think it is a cause that has mobilised a phenomenal level of support across the UK.’

When pressed as to whether he would like ‘a formal role’, Mr Johnson said: ‘I’m happy doing what I’m doing. I think, my job is to talk up what I think are the immediate needs of the Ukrainians,’ adding that he will ‘inevitably’ return to the country.

Mr Johnson was also asked if he feels ‘more appreciated on the world stage than he does domestically’.

Responding, he said: ‘I have an absolute passionate belief that the war in Ukraine, Putin’s act of aggression, is something that we shouldn’t accept, we shouldn’t tolerate.

‘I think that I can continue to campaign for Ukraine out of office and that’s what I’m going to do.’

The Mail has many more quotes from the interview.

One interesting thing is that Boris first became interested in Ukraine when he was Foreign Secretary under Theresa May. He said:

I was Foreign Secretary in 2016 and one of the first things I did was go to Ukraine and I remember talking to Ukrainians who had been fighting in Donbas and I remember going to see this great wall, with pictures of thousands and thousands of Ukrainian soldiers who’ve given their lives for the freedom and independence of their country, and I became very sympathetic to their cause.

I remember standing on that beautiful acropolis in Kyiv and talking about the possibility that Russia might be so insane as to take advantage of the fact that there was no security guarantee to Ukraine, because Ukraine was not given NATO membership and clearly it was a problem, and that is what we now have to fix.

COP27 came up. At the time Boris gave his interview, Rishi said he himself would not be going because he had more pressing business — the cost of living crisis — to resolve.

Boris received an invitation probably because he was the PM during COP26, held last year in Glasgow:

Yes as it happens, but that’s not relevant to Ukraine… I was invited by the Egyptians so I’m very happy to go.

He is in Egypt for the conference as I write.

Boris showed his support for Rishi:

Mr Johnson also gave his backing to Mr Sunak, insisting the PM had ‘a massive amount to do’.

‘We’ve got to sort out a huge agenda – that’s what’s he’s getting on with,’ he said.

As for his own participation at COP27, Boris said:

I was at the Glasgow Cop – although it’s become unfashionable to talk about it, was a fantastic global success.

‘We did a huge amount of good for the planet, I want to talk a little bit about how I see things and how we see things in the UK.’

Rishi Sunak decided to attend COP27 after all and is also there, enjoying fine meat and dairy menu options such as these:

Note the beef on offer.

Remember, COP27 folks want plebs like you and me to eat … BUGS.

Boris has taken the stage at COP27 twice.

In a speech, he said that the United Kingdom’s summer heat wave might have been responsible for was going on at Westminster (video here):

That’s a bit of a stretch.

In that video, he also referred to ‘pharaonic’ climate events, indirectly referring to the Israelites’ captivity in Egypt in the Bible.

Then he was interviewed by a reporter for The New York Times‘s Climate Forward (video here):

Supporting Rishi’s attendance, he said:

Some will go weak and wobbly on zero, we can’t have that…

Boris has his father Stanley whispering in one ear and his wife Carrie in the other about environmental issues. Meanwhile, the British are choosing between food and fuel this winter, but they do not care.

Just before the last Conservative leadership election last month, Boris gave a speech in Colorado. According to the rules owned by the Cabinet Office and administered by the Advisory Committee on Business Appointments (ACOBA) for former ministers of state and senior civil servants, one must wait at least three months after leaving office to take up an official appointment or employment. Speeches would fall under that category. Boris will have been handsomely paid for his time.

Now he is scheduled to speak for a second time within that three-month period, at Singapore in December:

On November 1, Guido Fawkes reported (emphases his):

The event is scheduled for December 2 in Singapore, where former US Vice President Dick Cheney is also expected to speak. This means Boris is still – by just a couple of days – within the three-month embargoed window of ACoBA’s Business Appointment rules:

The Rules state that a minimum waiting period of three months from the date of leaving office to taking up an appointment or employment will be expected when the former official was a Cabinet Ministers or a Permanent Secretary or equivalent, and may also be applied to other applicants if ACOBA believes this to be warranted by the circumstances of the individual case.

When Guido pointed out Boris’s first post-PM speech could be a potential breach, his team argued that ACoBA does allow for one-off gigs without them being signed off by Lord Pickles. A second, within the three months, doesn’t help Boris’s office’s line of defence…

Well, Boris never thought that rules applied to him, anyway.

One wonders if we will ever see him on the backbenches again.

On October 23, when the latest Conservative leadership contest was going on, Boris’s biographer, the redoubtable Tom Bower, appeared on GB News to say that he could earn a lot of money on the speaking circuit.

We recall that Boris was deeply concerned about money while he was PM, so this route must be appealing.

The Mail on Sunday quoted Bower as saying:

He was on track to earn £5 million this year but if he wins this vote, eventually the sky’s the limit,’ said Mr Bower

Mr Bower said Mr Johnson could easily match the estimated £100 million Tony Blair has made since quitting No 10 in 2007.

Also:

He has lined up a series of US speeches for up to £250,000 a time and signed a £1.5 million deal to write his memoirs, which will be put on hold should he return to No 10.

No wonder Boris decided not to pursue the leadership contest. He’s quids in as it is. Why ruin a great opportunity? For him, as a speaker and a former journalist, this will be money for old rope. He could do this in his sleep.

For anyone wondering, Sir Graham Brady MP, chair of the 1922 Committee of Conservative backbenchers — the man who can make or break a Prime Minister — stated on Friday, November 4, that Boris did have the numbers needed for the contest:

Guido reported:

In news that will only surprise deranged Boris-haters, reamainiacs and conspiracists, Graham Brady has confirmed Boris did have the support to make the final round of the Conservative leadership contest. Speaking to the BBCthe Chairman of the 1922 Committee confirmed Boris had over 100 MP supporters and simply decided not to stand. If Boris had made the ballot, he almost certainly would have won…

As the officer responsible for the contest, and one who remained neutral throughout, Brady is the authoritative source on the matter. This only strengthens Boris’s claims that his decision not to stand was motivated by concerns over party unity.

The coronation of Sunak has caused widespread discontent amongst Tory members, many of whom are now jumping ship to Reform UK. Not the ideal way to establish Conservative unity…

Agreed, but Sir Graham doesn’t care about party unity, nor does Rishi, nor does Boris.

And, finally, just to dispel any lingeringn doubt about Boris’s numbers, The Telegraph gave us Sir Graham’s quote to the BBC:

Speaking to the BBC, Sir Graham – chair of the Tory party’s 1922 Committee – said “two candidates” had reached the threshold, and “one of them decided not to then submit his nomination”.

There you have it.

No doubt Boris will be watching Rishi’s premiership with interest.

It becomes clearer by the day that most British voters support Home Secretary Suella Braverman and that vociferous Members of Parliament are working against her.

Picking up from where I left off yesterday, on Tuesday, November 1, Labour referred Braverman to the Financial Conduct Authority for her two breaches of the ministerial code during her time as Home Secretary under Liz Truss.

Furthermore, civil servants are still upset over Braverman’s use of ‘invasion’ on Monday in Parliament:

I’m still trying to wrap my head around the Financial Conduct Authority referral, which seems to be grasping at straws in this witch hunt.

The Guardian reports (emphases mine):

Suella Braverman has been referred to the financial service watchdog by Labour over claims she may have breached market abuse laws, as the home secretary also faced growing criticism for her “car crash” handling of a migrant processing facility in Kent.

Fresh questions were raised about the “growth visas” announcement Braverman sent to several figures outside the government that led to her sacking nearly two weeks ago, with one Conservative MP openly saying they did not “accept or trust this home secretary’s word”.

Did she send it to ‘several figures’ or just one or two people by mistake? Earlier reports suggested that she did not send it to a group of recipients.

The article continues. Labour’s premise seems to be a stretch of the imagination:

Labour claimed Braverman’s leak may have had significant economic repercussions, given the policy was designed to be factored into the Office for Budget Responsibility’s projections.

In a letter seen by the Guardian, the shadow City minister, Tulip Siddiq, wrote to the Financial Conduct Authority (FCA) urging them to launch an investigation and argued the move could “tangibly influence financial markets”.

She said there was a “case to answer”, as public interest and industry confidence in measures to prevent insider trading relied on trust they would be fully enforced.

Simon Case, the cabinet secretary, was also urged to confirm whether he believed the law had been broken.

Siddiq told him it was “not unreasonable to suggest” that the policy leak “could lead to insider trading on the value of sterling” and have other serious repercussions “if it fell into the wrong hands”.

Given Downing Street had briefed journalists when Braverman was sacked on 19 October that the information she leaked was market-sensitive, Siddiq said breaching insider trading laws “does not require proof that market-sensitive information has been acted upon for gain”. Unlawful disclosure “is a serious offence in its own right”, she added. Braverman has denied the leaks were market-sensitive.

Siddiq quoted FCA advice to government departments, which states that they “may hold information that is confidential, non-public and valuable”, which if handled incorrectly could lead to “disorderly markets” and “market abuse, such as insider dealing”.

While the guidance says that the law is not being broken if information is disclosed “in the normal exercise” of employment, Siddiq said it was “difficult to see that the disclosure of market sensitive, confidential, significant policy from a personal email address to someone outside of government is included in this exception to the rules”.

Yes, it does seem to be that Braverman corresponded with one Conservative MP intentionally and another person, a staffer to another Conservative MP, in error. This is hardly ‘several figures’:

Six days after her re-appointment as home secretary by Rishi Sunak, Braverman confirmed that she had forwarded a draft written ministerial statement about the launch of growth visas by Liz Truss’s government to a backbench MP, Sir John Hayes, and another colleague’s parliamentary staffer.

Given the admission, Siddiq said the FCA should launch an investigation into whether Braverman broke market abuse laws or regulations, and confirm that senior ministers should show the highest standards of protecting market-sensitive information.

Interestingly, when Braverman gets on with her job, hardly anyone reports on it.

On Thursday, November 3, she visited the Manston migrant processing centre in Kent. That afternoon, GB News showed the Government motorcade approaching the road to Manston.

No one else seems to have covered the story.

On the other hand, there were reports that two groups of migrants were dropped off at Victoria coach station in central London. With the first group, officials said that the migrants were going to be housed by friends or family. The whereabouts of the second group is less clear.

On Friday, November 4, The Times reported:

A second group of asylum seekers from the Manston immigration centre have said that they were abandoned at Victoria coach station by the Home Office and forced to sleep outside.

The incident is alleged to have taken place less than 24 hours after the Home Office left 11 migrants in the coach station without accommodation or warm clothing. The Home Office denied that the asylum seekers involved in the first incident had been abandoned in error and claimed that accommodation for them had been organised.

About 50 migrants were said to have arrived in London on a coach from Manston at about 9am on Wednesday. Many were picked up by friends or family, but a dozen spent the night outside Victoria as they had nowhere to go.

Members of the second group said the coach driver had told them a lack of accommodation was their problem. Of the group that slept outside the station six remained in Victoria yesterday and the six others went to central London in the hope of receiving support.

The group who remained in Victoria were approached by members of The Passage, a local homelessness charity, which took them to their local service and gave them hot meals, showers and tracksuits. It also provided medical assistance and arranged accommodation for last night

Danial Abbas, the volunteer who found the asylum seekers, said the Home Office told him there had been an “operational error”. Abbas accused the Home Office of being disingenuous. He said: “I would have a lot more respect if they put their hands up to any mistakes that they made and reassure the voting public that they have put measures in place to prevent this from happening again.”

Hmm

This has become an intractable situation.

In France, police are now instructed to leave the dinghies alone in certain conditions, which helps the smugglers.

On November 1, the Mail reported:

French police have been ordered not to stop migrant boats in the water departing for Britain because of fears of facing legal action.

The diktat has left ‘overwhelmed’ officers powerless to intervene as people smuggling gangs ruthlessly exploit the system to send thousands more migrants on perilous cross Channel crossings.

The policy was introduced after a campaign group filed a complaint accusing police of endangering human life after officers punctured an overloaded small boat just a few yards from the shore to prevent it leaving.

A subsequent notice from France‘s Departmental Board of the National Police issued on August 26 banned officers from targeting boats already in the water. Only those on the beach or on the road could be intercepted.

People smugglers swiftly responded, setting up almost untouchable ‘taxi boat’ services.

Instead of taking dinghies to the beach by road and inflating them on the sand, as before, gangs now pilot boats along the coast and pick up groups of migrants waiting on the shore at pre-arranged spots

The same article has a sidebar showing that the British people support Suella Braverman in her use of the word ‘invasion’ in Parliament:

The Mail+ readers overwhelmingly agree with Suella Braverman that the Channel migrant crisis is ‘out of control’.

In a poll of 2,494 people, 98 per cent said they agreed with the remarks of the Home Secretary. Just 2 per cent disagreed. On Monday Mrs Braverman told MPs that ministers needed to be straight with the public because the asylum system was broken.

Using remarkably stark language, Mrs Braverman also likened the Channel crossings to ‘an invasion’ of the southern coast. 

Once the migrants arrive in Britain, younger ones are allegedly urged to lie about their age in order to leave Manston sooner. The Home Office denies the allegations.

The Mail reported:

Child migrants are claiming that they are being pressed by UK officials to lie that they are adults so that they can leave the crisis-hit Manston compound more quickly, a report alleges.

The child asylum seekers, who are said to have crossed the Channel on small boats, are reportedly claiming that they were told by officials that they would be able to get out of the troubled processing plant in Kent faster if they pretend that they are over 18.

A recording was reportedly passed to The Guardian of an apparent 16-year-old Eritrean boy speaking to a guard at Manston on Saturday about the pressure he says he was put under to say he was older. 

The Refugee Council also gave the Left-wing newspaper information about three recent interviews their staff carried out with Kurdish boys from Iraq and Iran who made the same claims.

And a fifth child reportedly made the same allegation to the Humans for Rights Network, the report adds.

The Home Office branded the allegations ‘baseless speculation’, with a spokesperson telling MailOnline no evidence has been produced to back the claims. MailOnline has asked the Refugee Council and the Humans for Rights Network for further information.

Add to this the continuous pressure in Parliament to take in more ‘refugees’. Opposition MPs say that Britain takes in far too few, yet, by the end of the year, 50,000 people — mostly men — will have crossed the Channel in 2022.

However, Kelvin MacKenzie, the retired editor of the Sun, says that Britain takes in many more refugees than the largest EU countries:

With all of this mayhem swirling around Suella Braverman, one wonders if she can survive in post, even if she is the most determined to sort out the mess.

On Tuesday, The Telegraph‘s Christopher Hope listed ‘Five reasons why Rishi Sunak will not sack Suella Braverman’:

1. The Right needs a Cabinet champion

… Braverman is a darling of the party’s Right wing, as evidenced by the ovations she received at the party’s conference in Birmingham last month.

The party’s grassroots loved her – and she clearly is in tune with them. None of this is confected – Braverman is rightwing to her irreducible core …

This makes her politically valuable to Sunak. Right-wing Tories want to see one of their own at the top of the party – and Braverman is that person.

Hope’s second reason is to appease the Brexit-supporting European Research Group in Parliament. Braverman is one of their past chairmen.

His next reason is:

3. Cover for huge tax rises

Sunak’s Cabinet is stuffed with moderate Conservatives and fewer bona fide tax cutters. Braverman is one – and this is why she must remain there.

His fourth reason is to complete Brexit in line with sorting out the Northern Ireland Protocol, weighted heavily in the EU’s — and the Republic of Ireland’s — favour.

His last reason is:

5. Beware Suella the backbencher

Braverman’s pronouncements in the Commons last night that the borders “system is broken” and “immigration is out of control” show how desperate things are …

Labour Home Secretary John Reid did in 2006 when he declared the Home Office as “not fit for purpose” and broke it up to create the Ministry of Justice.

Braverman is ambitious. She told me on my podcast that wants to bring net immigration down to “tens of thousands”, adopting the famous target that former PM David Cameron could never meet …

And Sunak won’t want her on the backbenches, where she would emerge as a touchstone for criticism of the Home Office.

He concludes:

For now, at least, Braverman is the answer. As a Right-wing Conservative MP told me today: “She is the last chance we have to deal with the migrant boat crisis before the general election.”

I hope he is right.

For now, Braverman is beleaguered by attacks on all sides, including the civil servants notionally working for her.

I wish her all the best in her continuing quest.

This post concludes the story of how Rishi Sunak became Prime Minister.

Those who missed them might find parts 1 and 2 of interest.

Before concluding, an important anniversary took place this week.

On October 26, 2012, UKIP MP Douglas Carswell introduced a private member’s bill, ‘The People’s EU Withdrawal Bill’.

The groundswell of support from Guido Fawkes’s readers helped bring it to the Commons:

Guido has the video and a brief comment (emphases his):

Today history was made as the first-ever crowd-sourced Bill was debated in Parliament. The majority of 5,000 readers of this website voted for Douglas Carswell to propose Britain to withdraw from the European Union, and today Carswell stood up in the House to argue the case for the People’s Bill. The debate can be watched at length here. 

Video via @liarpoliticians

Here is a short video of proceedings:

A few years later, then-Prime Minister David Cameron, frightened by the overwhelming support for UKIP in the European election, decided to give the British people a referendum. It ended up being the largest plebiscite in the history of the United Kingdom. On Thursday, June 23, 2016, in pouring rain, voters said they wanted the UK to leave the EU: 52% to 48%.

In current news, during Rishi Sunak’s first week as PM, as I wrote yesterday, questions were being asked in the Commons and the Lords about Suella Braverman’s reappointment as Home Secretary.

The Telegraph‘s Madeline Grant called Braverman ‘Houdini’ for not showing up for an Urgent Question in the Commons about the horrifying state of the Manston processing centre in Kent, which is turning from a short-stay to a longer-term residence for Channel migrants (emphases in purple mine):

At a second Home Office UQ, this time courtesy of Labour’s Diana Johnson, the Home Secretary was a no-show again …

In truth, there were unhappy campers on both sides of the House; enough to populate Butlins, if not quite Calais …

Deputising for Houdini was Robert Jenrick – a junior Home Office minister and close ally of the PM who, some say, was appointed to keep a watchful eye on Braverman and prevent her from doing anything too mad

Yet Jenrick’s arguments were more true-blue, or at least Red Wall. He had little sympathy with illegal migrants, and the diversion of resources away from their legal counterparts, and seized eagerly on Priti Patel’s pet phrase, “evil people-smuggling gangs”. Reinforcements soon began to arrive from the Tory backbenches. What gave Labour the right to complain, wondered Steve Double, the MP for St Austell, when they’d voted against Patel’s Nationality and Borders Bill. Lee Anderson and Richard Graham warned of Britain’s imminent inundation by Albanian men.

Christopher Chope reminded the Commons that whatever the state of the Manston processing centre, conditions were a darn sight worse in the Calais Jungle. Labour MPs looked scandalised, but Jenrick agreed wholeheartedly.

When asked why he was deputising for Braverman:

Jenrick, in the spirit of Sunak, came back with an answer that was simultaneously boring and unimpeachable. “Because I’m the Minister of State for Immigration”

It is estimated that from 1% to 2% of Albanian men are in the UK. They have places to go to once they arrive. The Albanian drug trade is the latest development in our migration story.

The situation in Dover is intensifying. The Times reported the story of the week: ‘”Desperate” new arrivals drive Dover into taking up arms’. Sledgehammers, more like, as firearms are largely illegal here:

Sue Doyle, 59, was sitting in her living room sipping a cup of coffee on Sunday morning when a 16-year-old Albanian migrant got in through the back door, which she had left open for her dog.

“All of a sudden he was there standing in my front room,” she told The Times. “He didn’t seem very friendly. He kept saying: ‘no police, no police’.”

Doyle, a full-time carer for her mother, said she was made to her lock her dog in a bedroom and that the teenager then asked her to drive him to Manchester. When she refused he demanded her mobile phone and used it to arrange to be picked up by a contact.

Doyle managed to sneak out of the front door and alert a neighbour, who contacted the police and confronted the young migrant.

The neighbour, Louise Monger, 36, said she became more sympathetic when she realised his age and tried to assist him. Police arrived and he was detained before the driver arrived, she said …

The teenager who was arrested was said to be in tears as he was driven away in a police car …

A few doors down from Doyle, Kerry Jones, 45, a mother of a young autistic girl, said she now sleeps with a sledgehammer next to her bed after a migrant tried to enter her home through the back door in August

The residents complained that not enough was being done by the council, police and border force to deal with the problem. Many spoke of seeing migrants running through the streets and residential areas or “hiding in bushes” in local parks

When a Times reporter arrived at Dover Priory station yesterday a Syrian mother and her young child approached and asked for help getting to an “army base” where their money and belongings were.

The mother, Nur Taha, 27, said she and her son, Mohammad Salu, six, arrived in Dover ten days ago in an overcrowded dinghy that was rescued on the water and were separated from her partner Akram Salu, 49, who was detained by military police, and their possessions …

When a reporter called Kent Police to request assistance for the mother and son, he was told that no officers were available as they had more pressing priorities. The advice given was to let them roam in Dover and hope that they were safe.

In a statement on Doyle’s report, the force said it received a call at about 10.45am on Sunday that a man had entered “an insecure door at a property in Dover and was seeking the use of a phone”.

The force added: “He was initially arrested, then de-arrested at the scene once the circumstances had been established by speaking to both parties. The man was then detained on behalf of immigration officers.”

In Nur Taha’s case, it is understood she and Mohammad had been processed by Border Force officers

The council was approached for comment.

Mass migration started during Tony Blair’s government and has only become worse, as the backlog of cases is through the roof.

The Times reported:

Twenty years on, the Home Office again needs more information on those arriving, as well as stronger co-operation with France to stem the flow. Officials often have little information on claimants, whose lack of identification may be a deliberate ploy — case workers have little choice but to believe them: 75 per cent of asylum seekers were given the right to stay in the 12 months to March, the highest rate since 1990.

Meanwhile, claims are taking longer to assess, having climbed to an average of 480 days for an initial decision to be reached.

Some in the Home Office have suggested there is a deliberate policy of slowing down the processing of claims given the high rate of people granted asylum. A six-month target for assessing claims has been ditched and the rate of cases completed in that time has fallen from 80 per cent in 2015 to 17 per cent. But this looks set to change, given the soaring cost of housing those waiting for their claim to be assessed in hotels, which now stands at £6.8 million per day.

This month, the idea of erecting tent cities in London’s parks was mooted, something Paris has tried with shocking effect. Most Parisian women living near one of these tent cities can no longer go out at night. Drugs, violence and noise prevail once it turns dark.

The same Times article reported that London tent cities are unlikely to come to fruition:

The idea was raised by civil servants in meetings with leaders of London councils this month, sources said.

It was considered after efforts to persuade London boroughs and local authorities in other parts of the country to accommodate more asylum seekers failed. The Home Office had issued an emergency appeal to councils for more places earlier this year as officials struggled to cope with the growing numbers of migrants crossing the Channel.

Council leaders in the meeting dismissed the prospect of installing marquees in parks in the capital and instead urged the Home Office to lift the ban on asylum seekers being able to get a job …

The Home Office made clear last night that the plans to erect tents in London parks were no longer under consideration. It said: “It is categorically untrue to suggest that the Home Office is planning to erect tents to house asylum seekers in London parks.”

The idea arose during discussions on how to deal with overcrowding at the temporary asylum processing site at Manston Airport, which is only designed to hold Channel migrants for up to 24 hours.

It is unclear what Rishi Sunak has planned for Suella Braverman.

On the one hand, Sunak’s people say everything is in hand, and MI5 say they have no problem working with the Home Secretary, the Times revealed:

A former Conservative minister in the Home Office told The Times: “You can’t even have the vague notion that you might leak because then all the security services will clam up on you — which is not what you need.”

However, responding to claims that MI5 could withhold information from Braverman, a security source said: “This is completely untrue. The home secretary and MI5 have a strong and trusted working relationship. She will continue to receive regular intelligence briefings, as was the case when the home secretary was in post previously and with other home secretaries.”

Rishi Sunak’s spokesman insisted that Braverman had “strong relationships” with the security services and the prime minister’s full confidence.

Oh, dear: ‘the prime minister’s full confidence’. Those are dangerous words, dating back from the 1990s. That means a resignation or a sacking could be coming soon.

The Star wasted no time in putting ‘Leeky Sue’ on their Friday front page:

On the other hand, the Times said that Sunak’s allies are waiting for Braverman to go, possibly so that Jenrick can step in. He wouldn’t be very good, I don’t think, but that seems to be charactistic of Sunak’s government — business as usual, nothing gets done:

Sunak’s close ally and Braverman’s deputy in the Home Office, Robert Jenrick, responded to an urgent question on crossings yesterday in her place. The sole hope now, Sunak allies have whispered, is that Braverman makes a further error and goes for good, leaving Sunak and Jenrick to press on peacefully in her absence.

That doesn’t surprise me in the slightest.

The Guardian continued to cast shade on Braverman:

London’s Evening Standard, however, went with the story about Cabinet minister Nadhim Zahawi’s defence of the Home Secretary at the bottom of their front page:

One good thing that Rishi has done is to decline going to COP27:

A new poll shows that the Conservatives are doing better than Labour, but still have a huge hill to climb:

I disagree with Guido’s assessment here. The poll decline started with Boris and Partygate nearly a year ago:

That said, Guido rightly sees this as an uphill battle:

Add to that the impending storm of budget cuts, Rishi certainly faces an uphill battle.

The poll also strengthens Reform UK’s claims of a resurgence, with their support at 6% and growing representing a relatively strong showing. The Conservatives face challenges from all sides…

Finally, there’s the idiocy of America’s Trevor Noah calling Britain racist towards Rishi Sunak. I haven’t read one negative comment about his heritage from conservatives, ever. Labour — our equivalent of the Democrats — are the ones making the racist remarks.

The Telegraph reported:

Rishi Sunak does not believe Britain is a racist country, a Downing Street spokesman said, following claims by Trevor Noah that there was a “backlash” after he became the UK’s first British-Asian Prime Minister

“But you heard the words in the House [of Commons] on Wednesday with regard to the [appointment of the] Prime Minister,” the spokesman said. When asked whether Mr Sunak believes Britain is a racist country, the spokesman said: “No he doesn’t.”

His words were echoed by Sajid Javid, the former chancellor and health secretary, who said Noah was “detached from reality” when he claimed Mr Sunak’s appointment provoked a racist “backlash”.

… Tom Holland, a popular historian and podcaster, wrote:

—————————————————————————————————————–

Now back to the leadership contest, where we pick up on the events of Saturday, October 22, 2022.

Boris returns to the UK

The Sun‘s Harry Cole told TalkTV that Boris and Rishi could come up with a plan to save the country:

Sky News’s Mark Stone was tracking Boris’s progress back to the UK:

Sky News interviewed Chris Heaton-Harris MP, who said that Boris definitely had 100 backers (see video):

Guido was eager to confirm, as Boris’s numbers were far behind Rishi’s at that point:

Boris landed at Gatwick mid-morning:

Guido was hopeful for his prospects:

One German newspaper, however, was less than enthusiastic, asking, ‘Seriously?’:

Former Home Secretary and Boris loyalist Priti Patel declared her support:

However, the never-Boris MP, Sir Roger Gale, did not mince words in an interview with LBC:

Scottish Conservatives would agree. The Telegraph‘s Alan Cochrane wrote:

Just when an air of undisguised relief began to filter through the higher reaches of the Scottish Tories at the resignation of Prime Minister Liz Truss, along came Boris Johnson to dampen their ardour.

They may not have been the greatest fans of Ms Truss and were glad to see the back of her. But their view of Boris bordered on the certain belief that he was a major electoral liability north of the border. And as the news emerged that the former PM aims to stand again for the top job, one former senior minister commented: “It will destroy the Conservative Party if he does.”

At lunchtime, Harry Cole produced a poll for the Sun saying that Boris still topped the charts. That must have been in England, then:

However, Lord Frost thought that Rishi was the right man for the job:

One Twitter user reminded us that Boris plucked David GH Frost from obscurity and elevated him to the House of Lords:

However, the BBC’s Laura Kuenssberg and ITV News’s Anushka Asthana spotted a trend. Former Boris supporters, such as Lord Frost, who also supported Liz Truss, now preferred Rishi Sunak:

That afternoon, Boris’s father Stanley appeared again on GB News, saying he would vote for his son if the contest went to Party members:

Just before 3 p.m., Boris backers told the BBC’s Chris Mason that the former PM had the numbers:

However, the Evening Standard‘s Nicholas Cecil sounded a note of caution — Boris’s MPs did not want their names made public:

A Mail+ report couldn’t shed much more light on the names, either:

On Saturday morning, former Home Secretary Priti Patel said she was backing Mr Johnson in the leadership race because he had a ‘proven track record’. Ms Truss, Defence Secretary Ben Wallace and former Home Secretary Suella Braverman are also in Mr Johnson’s camp, while former No10 chief of staff Steve Barclay and ex Brexit Minister Lord Frost have publicly backed rival Rishi Sunak.

Just before 3 p.m., another Twitter user provided this analysis, saying that Rishi had the momentum and numbers:

Just after 3 p.m., Guido’s spreadsheet showed that Rishi was on 120 MPs with Boris on 71:

Red Wall MP Lee Anderson declared his support for Boris after 3:30:

That was about it for Boris’s afternoon.

Shortly after 6 p.m., Guido described how he and his team were compiling their spreadsheet. The following points stood out:

Here is some insight into what has happened in the last few days: the Rishi campaign has decided in their wisdom to freeze Guido out – no briefing, no contact, effectively pretending we don’t exist as a fact of political life. Petulantly putting us in the penalty box for giving Rishi a hard time in the last leadership campaign. We started reporting and publicly recording the support of MPs for Boris on Thursday, and by yesterday evening the Rishi campaign was instructing their supporting MPs to contact us to confirm their support for him. As our records showed support for Rishi catching up with and then pulling ahead of Boris, his campaign reminded supporters to confirm their pledges to us. All can now see the relative strength of candidates’ support.

… MPs who have not pledged can be seen by all sides. They are either genuinely undecided – waiting to see which way the wind blows – or biding their time for Machiavellian reasons, or simply ransoming their vote for the highest bid or best favour. What MPs can’t do is double pledge any more. If they tell a campaign they are backing their candidate the campaign expects them to go public. If they don’t go public, they are suspect.

Yesterday the site was visited three quarters of a million times, such was the demand for data.* This kind of transparency is now a fact of political life, the game has changed. Changed for the better…

*Team Rishi’s strategy of ignoring the website read by so much of the membership doesn’t bode well for their success if the contest goes to the membership.

Penny who?

Meanwhile, Penny Mordaunt’s leadership bid wasn’t the best.

Although this was strictly for MPs, The Guardian went to her Portsmouth North constituency to find out what the public thought:

Penny Mordaunt may have been the MP for Portsmouth North for 12 years, and could perhaps be the next prime minister, but some of her constituents were perplexed when hearing her name on Friday.

“Who’s she? I don’t know nothing about her,” said James McLeish, who added he would not recognise her if she passed him on the street. “Never seen her, don’t even know what she stands for.”

McLeish’s bemusement came hours before Mordaunt formally announced she was standing to replace Liz Truss – stealing a march on her presumed rivals Rishi Sunak and Boris Johnson.

Speaking in Cosham High Street, which runs through the centre of a suburb to the north of the port city, McLeish, 82, had a much clearer view on Truss’s resignation after a disastrous 45 days in office.

The Telegraph‘s Tim Stanley gave us a tongue-in-cheek profile of the Leader of the House:

What about Penny Mordaunt, bringing up the rear? She was the first candidate to declare – and she surprised everyone last time by how far she went. The Tory grassroots appear besotted with this lady, thanks to her naval career and taste for innuendo; she exudes an impression of authority that was bolstered during the accession of Charles III when she managed to read aloud from an official document clearly and without error. That’s all it takes nowadays. If only she were in Parliament, Angela Rippon would be a shoe-in.

Ms Mordaunt has reportedly told Jeremy Hunt that if she wins, he can write economic policy. And Mr Hunt, no doubt, rang the Bank of England and said, “If Penny wins, you can write economic policy.” The Bank rang the IMF… and on it went all the way to Joe Biden, who put a call through to his wife, even though she was lying next to him, and said, “Honey, if Penny Farthing is made Queen of England, you can write economic policy.”

Stanley spoke with Conservative Party members:

What do the members think? I’ve put out feelers. They want Boris.

They know he’s not Jesus. He might have spent 40 days in the desert, but if the Devil tried to tempt him, he’d give in on every occasion. Yet they voted for Truss, the suits kicked her out – so now they want the good times back with BoJo. He likes pina coladas and dancing in the rain. And if they want him, and assuming he can find his passport – last seen in a swimming pool locker – he’ll be right with us.

Harry Cole said that Penny’s backers during the Liz Truss contest during the summer were now plumping for Boris or Rishi this time around:

Deal? No deal

Boris and Rishi met on Saturday evening. The meeting lasted three hours. The Times reported it took place at Boris’s office in Millbank Tower. I’ve been to Millbank Tower. It has lovely offices and a spectacular view of the Thames.

The Sun put the talks on its front page on Sunday, October 23:

The paper’s Harry Cole tweeted when the meeting ended, which was after 11 p.m.:

On Sunday, Cole said that Boris’s backers did not want to make themselves public until they were sure there was no deal:

There was no deal.

The Mail on Sunday reported that Suella Braverman was backing Rishi:

She wrote in the Telegraph: ‘I have backed Boris from the start. From running alongside him in London in 2012, to supporting him to be our leader in 2019 and willing him to succeed throughout the travails of this year. His resignation in July was a loss for our country.

‘But we are in dire straits now. We need unity, stability and efficiency. Rishi is the only candidate that fits the bill and I am proud to support him.’

The article gave us scant information on the meeting between Boris and Rishi:

Last night’s crunch summit between Mr Johnson and Mr Sunak, which is believed to have ended shortly before 11.20pm, comes ahead of tomorrow’s deadline for Tory leadership hopefuls to secure the backing of 100 MPs.

The headline banners read:

  • Ex-Chancellor fomally confirms candidacy for Tory leadership after late-night talks with Boris Johnson
  • It was claimed this morning that no agreement was struck between the pair in their three-hour negotiations
  • Some had been hoping for a power-sharing pact between the pair in order to avoid a divisive battle

Sunday’s hope would not last

The day began well, but with Boris’s numbers stagnant, reality began to set in.

That morning, Redfield & Wilton Strategies released a positive poll for Boris, taken on October 20 and 21:

Guido showed us the Mail on Sunday poll, which also showed that Boris had the best chance of stemming a Labour majority were a general election to take place that day. Guido meant ‘Tory’ not ‘Toy’, by the way:

Liz Truss’s Business Secretary Jacob Rees-Mogg told Laura Kuenssberg that Boris had the numbers (video):

Rees-Mogg also defended Boris’s record (video):

Later that morning, Guido said that some MPs were sounding out their constituents:

Just before 2 p.m., Foreign Secretary James Cleverly tweeted that he was backing Boris:

Meanwhile, Rishi already had 150 MPs signed up to vote for him, including names:

The Mail on Sunday reported that Boris allegedly contacted Penny Mordaunt to ask her to stand aside. The sign of a desperate man:

Penny Mordaunt, who officially declared her leadership bid on Friday, was claimed to have rebuffed Mr Johnson’s attempts to get her to drop out of the Tory leadership race in a phone call this afternoon.

He was reported to have told the ex-PM that, even if she did quit, most of her supporters would switch to Mr Sunak and not Mr Johnson. 

‘I’m in this to win it,’ the Leader of the House of Commons declared, despite signs she is struggling to win backers.

Boris bows out

Around 9 p.m., Boris announced that he was withdrawing from the contest. The time was not right for him to return, he said.

Afterwards, the Telegraph recapped the past 24 hours and said the meeting between him and Rishi on Saturday night lasted only one hour:

It was as he sat with Rishi Sunak, face-to-face for 60 minutes with no one else in the room, that Boris Johnson rolled the dice for the last time …

Barely a word had been passed between Mr Sunak and Mr Johnson since their relationship imploded in July.

Yet on Saturday night, the two biggest names in Tory politics agreed to down tools and meet, with the keys to Number 10 the prize on the table …

But the truth was that he believed a joint ticket between the two men, with him back as prime minister, was his route back to Downing Street.

The meeting was called at the behest of Mr Johnson, not Mr Sunak.

It was also, according to one figure who was in touch with one of the two candidates on Sunday, a surprisingly convivial affair. “It was perfectly pleasant,” said the source.

But Mr Johnson had been forced into a meeting with his old foe in an attempt to regain control of the corridors of power.

Above all, it was no Granita pact [one between Tony Blair as PM and Gordon Brown as Chancellor, done in a London restaurant of the same name] because of one simple reality – there was no deal. Mr Sunak did not agree to stand aside. Nor did Mr Johnson. They parted ways unresolved.

On Sunday morning, Boris rang his supporters:

His gamble to take control of Mr Sunak’s bigger list of backers had failed.

That much became clear at 8am on Sunday, when Mr Johnson gathered his supporters on a video call and informed them no agreement had been reached.

We found out more about his appeal to Penny to stand aside:

Ms Mordaunt gave him short shrift. The Commons Leader, who remembers being ejected from the Cabinet by Mr Johnson on his first day in office in July 2019, told him most of her MP supporters would prefer to back Mr Sunak – and that he should consider dropping out of the race and leave her to face him alone. Her offer was refused.

On Saturday, Boris’s aides even said he would keep Jeremy Hunt as Chancellor:

Searching, perhaps, to persuade MPs he had credibility as a “unity candidate”, Mr Johnson’s aides let it be known he would keep Jeremy Hunt in post as Chancellor if he won the contest.

Little did he know that at that moment, Mr Hunt was preparing to make his first public declaration of the leadership race since ruling himself out – by backing Mr Sunak in an article for The Telegraph.

King Charles would have said, ‘Dear, oh dear’.

On Sunday, around 9 p.m., Boris threw in the towel:

By 9pm, the answer was clear.

Writing to his supporters on a WhatsApp group, Mr Johnson himself conceded defeat – but claimed he had the numbers all along.

Telling friends he had been “overwhelmed” by support from MPs, he maintained that he was “uniquely placed to avert a general election”.

Stressing that he had cleared the “high hurdle” of 102 nominations including a proposer and a seconder, he said he was confident he could be “back in Downing Street on Friday”.

But it appeared the concern among Tory MPs about the return of their former leader had rattled Mr Johnson.

Confirming he had “reached out” to Mr Sunak and Ms Mordaunt in an attempt to strike a deal, his message concluded: “I am afraid that the best thing is that I do not allow my nomination to go forward and commit my support to whoever succeeds.”

… As he told MPs on Sunday night: “I believe I have much to offer but I am afraid this is simply not the right time.”

One of Boris’s main supporters, Sir James Duddridge MP, was nonplussed:

An hour later, he changed his support from Boris to Rishi:

Jonathan Gullis, a Red Wall MP, didn’t wait that long:

Braverman pivotal to Rishi’s support

On Monday, October 24, the Times had two articles about the importance of Suella Braverman backing Rishi.

One said:

The European Research Group of Eurosceptic backbenchers [Brexit supporters], which in previous leadership contests has acted as a bloc, is increasingly fractured.

Suella Braverman, the former home secretary who was once one of Johnson’s most ardent supporters, came out for Sunak. The party, she said, could not afford to indulge in “parochial or nativist fantasies” given the “dire straits” it was in now. The world was “fundamentally different” from when Johnson was elected in 2019.

Braverman’s endorsement of Sunak surprised even some of her allies, with one speculating about whether she had been offered the chance to return as home secretary. “She wouldn’t have settled for much less,” said one.

Braverman’s support was not just a blow to Johnson, it also allowed Sunak to make the case to wavering MPs that he could command support across the party. As well as Braverman, Sunak won the backing of other former ERG stalwarts such as Steve Baker and Theresa Villiers. He has even persuaded MPs who had joined a “Back Boris 22” WhatsApp group to jump ship, including Chris Loder, MP for West Dorset.

It suggests that Sunak has made assurances to the ERG on policy and jobs, given that senior ERG figures were briefing on Friday that they would seek “guarantees” before endorsing candidates, which ranged from no concessions on the Northern Ireland protocol, reaffirming the manifesto commitment to reduce immigration and senior cabinet roles for their members.

Braverman suggested as much, saying in an article for The Telegraph website that the party needed to “move beyond Leaver or Remainer; One Nation or ERG; right of the party or left of the party; wets or Thatcherites,” adding: “One person can build that team: Rishi Sunak.”

The other said that Boris’s team had approached her for support on Saturday but was rebuffed:

Johnson’s team had made a “big pitch” to her yesterday in the hope that winning her over would persuade fellow right-wing MPs to back him. She is a former head of the European Research Group of Brexiteer MPs. It is a further sign that the ERG is split down the middle between Sunak and Johnson …

Her endorsement will deliver a big blow to Johnson’s efforts to attract the remaining MPs on the right of the party, as she is seen as one of their flag-bearers and rising stars.

She is the latest figure on the right to endorse Sunak following Kemi Badenoch, the trade secretary, and Lord Frost.

Braverman also signalled that Sunak had agreed to continue with reforms she had begun working on during her short spell as home secretary, including a new law to prevent the European Convention on Human Rights allowing migrants and criminals to avoid deportation. It also suggests that Sunak has agreed to press ahead with the government’s controversial Rwanda policy.

I hope that all works out for her.

Unfortunately for James Duddridge, the Boris loyalist, even though he voted for Rishi, he was sacked as Trade minister on Wednesday:

Jacob Rees-Mogg also got the sack this week and has returned to the backbenches.

Rishi’s ‘coronation’

On Monday morning, October 24, the outspoken Lee Anderson refused to back Rishi, swapping his vote from Boris to Penny. Interesting, to say the least:

Just before 1 p.m., Rishi had over 200 backers, double of what he needed:

At 2 p.m., the all-powerful 1922 Committee assembled at Conservative Party headquarters (CCHQ) to announce the results.

They had to meet at CCHQ, because while Rishi was the new Party leader, he was not yet Prime Minister and would not be able to enter No. 10 until he met with the King, who would grant him permission to form a government. The monarch returned to London on Tuesday, at which time Rishi’s premiership was formalised.

According to the 1922 Committee, Boris had real numbers behind him — and had passed the threshold:

Guido reported:

For the historical record Nigel Adams says he met this morning with Bob Blackman, Joint Secretary of the 1922 Committee.

He has independently verified the nomination paperwork and confirmed to me that Rt Hon Boris Johnson MP was above the threshold required to stand for the Conservative Party leadership in this leadership election. Therefore Mr Johnson could have proceeded to the ballot had he chosen to do so.

The nominations process is confidential and it is up to individual MPs whether they wish to publicly announce who they back in leadership elections – Bob Blackman is verifying nominations today for the remaining candidates in this leadership election. Those still suffering from Boris Derangement Syndrome may need to seek help…

At the very last minute, Penny Mordaunt withdrew from the contest.

That meant Rishi had his ‘coronation’ as the only candidate left.

As such, the vote did not need to go to the Party members.

Conservative MPs were happy as Larry as they rejoiced that they finally got their man in office at last.

That evening, GB News reported that the Party’s phone lines and website could not handle the amount of calls and clicks from members trying to cancel their membership.

They weren’t angry at Rishi as much as they were the MPs who denied them a say.

End of series

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