DIPLOMAT PROFILE: CHANCELLOR OF THE EXCHEQUER RISHI SUNAK
Former Diplomatic Editor of The Times Michael Binyon looks at the minister who is trying to prevent Britain’s economy from collapse
He is young, polished, smart, competent and has film-star good looks. Rishi Sunak, Britain’s new Chancellor of the Exchequer (finance minister) who is trying to rescue the economy from collapse amid the coronavirus, is a political sensation in Boris Johnson’s government. Virtually unknown until his appointment in February, he is now overwhelmingly the most popular minister in the government, far outshining the prime minister. Already, speculation is rising that he might one day take over Johnson’s job.
That would be extraordinary, not just in Britain but throughout Europe. Sunak is the son of Indian immigrants from East Africa. If he took the top job in Britain, he would be the first person of non-European origin to become leader of his country anywhere in Europe. No one of black, Indian, Chinese, Arab or any other non-European origin has ever yet risen to the top, despite the growing importance of some ethnic minority politicians in France, Germanyand Italy.
Sunak has risen to power quickly. Born in Britain, the son of a doctor and a pharmacologist, he had a privileged upbringing. He attended Winchester, one of Britain’s most famous elite private schools, where he became head boy, took a first-class degree at Oxford and then went to Stanford University in California where he gained an MBA. While there, he met the daughter of the chairman of Infosys, a millionaire who heads one of India’s largest hi-tech companies. They married and have two children.
Sunak did not enter politics until five years ago, when he was selected to represent a seat in northern England that had been the parliamentary seat of William Hague, a former foreign secretary. He soon was made a junior minister, although remained unknown to the public. His break came in February when senior cabinet minister Sajid Javid had a row with Boris Johnson’s top aide and resigned as Chancellor of the Exchequer. Sunak was appointed in his place. He was not yet 40. Untested in a top political job, he was seen as a mere yes-man who would be very much subservient to Johnson. But he had to produce a national budget within a few weeks and show his authority in the second most important job in government.
Coronavirus changed everything. Suddenly Britain was forced to spend billions of pounds to try to rescue the economy as businesses collapsed, shops, restaurants and factories were closed and public life came to a standstill. The nation was on the brink of economic disaster. Sunak rose to the occasion. He rapidly announced a series of huge government loans and grants, including the promise to pay up to 80 per cent of wages for employees who had lost their jobs because of the virus. This amounted to paying the wages of more than 12 million workers for three months – amounting to a vast sum of money. He also took over the cost of running Britain’s trains and buses, which were carrying no passengers and losing millions of pounds. He announced wage rises for key health workers and those in the emergency services. He relaxed the taxes on selling houses to stimulate the housing market, promised infrastructure spending to get the economy moving and, as the lockdown was eased, even offered consumers a government grant for every meal they ate in restaurants to try to revive the struggling hospitality sector. At the start of lockdown he promised he would spend “whatever it takes” to save the economy.
Anyone who gives away billions of pounds is likely to be popular. But this is an extraordinary change of policy for a Conservative government, which for a decade had been wedded to a policy of austerity in the aftermath of the global economic crash of 2009. The Conservatives, and Johnson especially, were long in favour of low government spending, low taxes and a reduction in borrowing. Suddenly their finance minister was promoting policies that meant spending far more than any government – Conservative or Labour – had spent in peacetime and borrowing as much as the entire output of the British economy. This marked a huge change in philosophy. Johnson promised an end to austerity, which over the past 10 years had cut hundreds of thousands of jobs, impoverished schools, hospitals and the public sector, cut the budgets of local councils and made the Conservatives increasingly unpopular. From now on, the government would play a much bigger role in the economy.
So far, Sunak has not said how all this money will be paid back. But he has been lucky. With interest rates at almost zero, it has cost very little to borrow. He has also been clever at finding schemes that have proved effective in the short term. But at some stage taxes will have to rise. And then his image as a ‘wonder-boy’ will inevitably begin to slip. But like many modern politicians, he has made sure of a good image, using professionals to promote his reputation online and to younger people. He is also eloquent in coining good phrases. “Although hardship lies ahead, no one will be left without hope,” he said at the start of lockdown as infections were rising fast. It sounded almost Churchillian, offering hope in the depths of disaster. He also appealed to bankers, finance chiefs and the civil service by showing a mastery of detail and a dedication to competence. “In God we trust, but everyone else needs to bring data to the table,” he said.
Comparisons are already being made with Johnson, whose reputation has been badly dented by the virus. Johnson is bullish, untidy, enthusiastic, noisy, prone to exaggerating, concealing bad news and changing his mind and his policies without much attention to detail. These are poor qualities for handling the challenges of the virus. He has been widely accused of wavering, telling lies, being unwilling and unable to focus on details and responding more to what seems popular rather than to the demands of leadership and crisis management. He is compared by many Britons to Donald Trump, a figure who is ridiculed and despised by almost everyone in Britain. Sunak, by contrast, appears sober (he is a teetotaller), elegant, focused, neat and quietly spoken.
For the moment, Sunak is unsackable; the cabinet is seen to be lacking talent and charisma, and Sunak is the only minister attracting enthusiasm, despite his obviously wealthy and privileged background. Johnson, however, is fiercely ambitious and demands loyalty above all. Sunak may be loyal to him, but there is speculation that Johnson will not tolerate the rise of a potential rival who might one day oust him as prime minster.
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