The second Conservative leadership contest is nearing its end game, but it has seen an almost total absence of policy discussion. Nevertheless, it’s barely three months since Rishi Sunak, the frontrunner, set out his stall for the premiership in his clash with Liz Truss.
Britain’s fiscal circumstances have deteriorated materially since then but this is what Mr Sunak revealed his instincts to be before Ms Truss blew up Britain’s finances.
Tax
Mr Sunak wants to present himself as a traditional low-tax Tory and pledged to drop the bottom rate of income tax from 20 per cent to just 16 per cent.
However, he insisted he would only do so prudently, meaning it would not happen until the end of the next parliament, likely in 2029. That was to ensure the cuts were funded by “growth” and not borrowing.
“I will never get taxes down in a way that just puts inflation up,” he said, promising to “always be honest about the challenges we face”.
Mr Sunak had already pledged to put up corporation tax from 19 to 25 per cent, a rise Ms Truss scrapped but was forced to restore after her disastrous mini-Budget.
The former chancellor was also responsible for the 1.25 per cent increase in National Insurance contributions for employees and employers. This was also scrapped by Ms Truss, and remains scrapped for now.
He also imposed a four-year freeze on income tax thresholds, an effective stealth tax that was set to raise £21 billion.
Spending
Mr Sunak was tight-lipped on his spending plans during the previous leadership campaign. However, his final mini-Budget in March effectively included £17 billion in cuts because he made spending decisions in cash terms and did not include any allowance for soaring inflation.
He was unlikely to have indulged in huge spending, however, resisting Mr Johnson’s urge to open the taps when he was chancellor and warning when he launched his first leadership campaign: “We need a return to traditional Conservative economic values – and that means honesty and responsibility, not fairy tales."
Net zero
While rumours of Mr Sunak’s net-zero scepticism have often swirled, on the campaign trail he has stuck firmly to the target.
He said this summer that he would make the UK energy independent by 2045. “We need more offshore wind, more rooftop solar and more nuclear. We need to insulate millions of homes and ensure that people know about the steps that they can take, at no cost, to improve the efficiency of their homes," he said.
He pledged to streamline planning and licensing rules for green energy to help achieve that goal.
Northern Ireland Protocol
When asked about the protocol at hustings in Belfast, Rishi Sunak said the following: “There is probably not a lot of disagreement between me and Liz on this.”
He is committed to the Northern Ireland Protocol Bill, which would give the UK Government the ability to tear up the Brexit agreement on Ireland with little scrutiny.
However, in her brief time in office, Ms Truss saw a relative thawing in relations with the EU which Mr Sunak may want to maintain.
Migration and Channel crisis
Mr Sunak said in the summer that he would cap the number of refugees Britain would take each year and do “whatever it takes” to make the Government’s Rwanda programme for asylum seekers work.
As part of those plans, he pledged to tighten up the definition of who was eligible to claim asylum in Britain. He also promised more caseworkers and incentives to help clear the backlog of applicants.
His campaign also said that he wanted to link illegal migration to aid and to trade agreements, including clauses that would require countries to take back failed migrants.
“We need to inject a healthy dose of common sense into the system, and that is what my plan does,” he said.
Ukraine and Defence
Mr Sunak is entirely behind the UK’s support for Ukraine. In July he said: “If I become Prime Minister, I will redouble our efforts and reinforce our policy of total support for Ukraine that Boris has so ably led."
However, on defence spending he became embroiled in a row with Ben Wallace, the Defence Secretary. Mr Wallace claimed that Mr Sunak tried to block a multi-year settlement for the Armed Forces in 2019.
The former chancellor tried to shrug off those criticisms, saying: “Defence spending needs to increase, and I will never shortchange our Armed Forces.” But he also called a three per cent of GDP target “arbitrary” and said “it’s not a plan”.
NHS and social care spending
In office, Mr Sunak insisted on the rise in National Insurance contributions to pay for the clearing of NHS backlogs and, eventually, to fund social care spending.
On the campaign trail he did not set out further plans, saying only: “I don’t think we can have an NHS which is underfunded and not able to deliver the care that it needs. I think you can be reassured the NHS is safe in my hands.”
Trans issues
Allies of Mr Sunak said in the summer that he would combat “recent trends to erase women via the use of clumsy, gender-neutral language” and launch a “manifesto for women’s rights”.
Asked on the campaign trail if trans women were women, he answered: “No.”
However, he also said at a hustings that “Prejudice against trans people is wrong. The Conservative Party is an open, welcoming family to everybody across society, no matter who they are and irrespective of their background.”
Cost of living
Mr Sunak was never forced to get specific over his plans for soaring energy bills but he did set out loose proposals. He said he would spend £5 billion cutting VAT from energy and a further £5 billion to help pensioners and the poorest through existing benefits systems such as Universal Credit.
That is only a fraction of what Ms Truss ended up implementing, and it is far from clear if Mr Sunak could step back from what has already been promised.
