Thanks to Risha Sunak and Jeremy Hunt’s autumn statement, financial markets were generally relieved of stress. But as the dust settles on the details of Hunt’s financial proposals, the government faces other problems – not least the ongoing mass protests that threaten to engulf Britain over the festive season.
Indeed, the UK’s “winter of discontent” turned colder on Friday when the Royal College of Nursing announced that its members would stage the first national strikes in its 106-year history.
Hospital staff will now face university teachers, junior civil servants, posts and railway workers on pickets across the country. For Sunak, there is nothing pretty about Britain now facing a general strike in all but name.
However, unlike his two immediate predecessors, the Prime Minister has shown a certain political will to negotiate a settlement. Mark Harper’s “positive meeting” with rail union leaders Thursday highlighted “shared” goals and a mutually conciliatory tone.
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It was a sign of progress. RMT general secretary Mick Lynch welcomed the end of the “belligerent rhetoric” that had characterized Grant Shapps’ tenure as transport chief.
Given what we know about Rishi Sunak, this makes sense. The prime minister has built his political brand around being a problem-solving politician – a pragmatist to his allies and a technocrat to his many enemies. Just as with the autumn statement, Sunac can set aside ideological instinct and move forward on the basis of industrial reconciliation. As a prime minister whose head is still full of money in the treasury, Sunak would surely see the economic benefits of ending the strikes before Christmas.
But Sunak’s problem is that he is fighting more than just unions. The Prime Minister may face a much tougher battle with her own Conservative Party, whose political priorities have not changed in British unions since the 1980s.
Unions want wages to outpace inflation to tackle the cost of living crisis. But equally, the Conservative Party wants to find a scapegoat for stagflation and put an end to the problematic phenomenon of unions becoming “militant” media celebrities.
Indeed, at a time of such volatility in Conservative politics, the party’s muscle memory around union action has proved reliably durable. The political points that leading trade unionists are Marxists, that Labor is ignorant and that pay rises will spiral wages and prices have convinced us that, despite the reshuffle, the Conservative Party is at its core the same the same beast that strives for the same political project.
At Prime Minister’s Questions on Wednesday, Sunak showed he could dance to that familiar Tory tune. Asked why Britain is facing the lowest growth of any OECD country, Sunak urged Keir Starmer to get his union “users” on the phone.
The roar from the back benches was deafening.
But while such rhetoric will buy Sunak some short-term political space, it could end up hampering the chances of industrial reconciliation in the long run. It also creates a tyranny of expectations within Conservatism that Sunak will actually show some of the Thatcherite strike resistance.
There is certainly no love between Sunak and his parliamentary party at the moment. Conservative Unity is now limited to 12.00pm to 12.45pm on Wednesday afternoons. Arguments over planning reforms, onshore wind and tax hikes dominate either side of this 45-minute moment.
Simply put: many Conservative MPs believe that the chief technocrat is not a sincere supporter of too many hot-button issues.
Having been forced to swallow Jeremy Hunt’s bitter medicine, Conservative MPs will now be looking to make a statement. A crisis of party identity may end up focusing minds against the strikers.
Fortunately for Sunak-skeptic MPs, they will find a union-busting ally in Chancellor Jeremy Hunt.
Hunt’s record for looking at hitters continues; famously, as health minister he consistently refused to negotiate with junior doctors, instead accusing the strikers of “putting patients at risk” with their “completely unnecessary” industrial action.
And, much to Sunak’s chagrin, Jeremy Hunt holds the government’s purse strings.
It’s no secret that Hunt wasn’t Sunak’s favorite choice for chancellor (that was Mel Stride), but back in October the new prime minister couldn’t risk another Treasury shake-up without spooking the markets. By the time Sunak took office, Hunt had already written the financial proposals that would eventually become the Autumn Statement.
Hunt, who became a survivor of the year in Spectator This week’s Parliamentarian of the Year Awards honored a man who makes “tough decisions”. He made sure that the autumn report went through the OBR’s careful calculation and forecasting process – no grain was left unaccounted for.
Hunt then presented the whitewashed Conservatives with a raft of tax increases, insisting they were the bare minimum if the government wanted to support the economic stabilizers of social security and pensions. The choreography of the pitch was good and Hunt played off every sharpshooter in the back bench with a simple bat. He made “compassionate” but “difficult” decisions in the name of stability.
That foundation has been laid so thoroughly that members of the back bench will expect Sunak to be equally “heavy” when it comes to the strikers. After all, no one hides that meeting the demands of trade unions or reaching some kind of compromise will have a price.
Any agreed settlement with the RMT would dispel the notion that there was simply no fiscal room to cut taxes. That would make the backbenchers and the beleaguered Jeremy Hunt pretty miserable.
Moreover, when department heads are called upon to identify savings to cope with pressures from higher inflation, ministers will not take kindly to public sector pay rises cutting into their departments’ spending.
Thus, Sunak faces the now-familiar pressure on the issue of labor relations. On the one hand, he will strive for some kind of compromise — to avoid public anger and media accusations of deepening the “winter of discontent.” But in doing so, Sunak must first confront his backbenchers.
And in times of difficult compromises, conservative MPs will not treat trade unions’ demands lightly.