It is less than a fortnight since Liz Truss formed a new government after a summer of bitter Conservative party infighting. It is just days until her chancellor reveals significant plans that are likely to dominate British politics and frame the next election.
Yet the Palace of Westminster has rarely been so becalmed. As mourners have wound their way into Westminster Hall to pay their respects to the Queen, a building that would ordinarily be a hotbed of political jousting, plotting and intrigue has instead become a site of pilgrimage, respect and quiet reflection.
While there has been a natural and well-observed suspension of political hostilities, however, MPs across the political divide are under no illusions about the maelstrom that will be unleashed when the Queen’s state funeral has been completed and the period of mourning ends.
The pent-up tensions will be released in an extraordinary week that will see Truss attempt to make up for lost time and define her early days as prime minister. After meeting world leaders this weekend, but not US president Joe Biden, Truss will then take to the world stage at the UN general assembly in New York, before a blitz of headline economic and policy announcements designed to kickstart her time in No 10. Meanwhile, opposition parties have a raft of attack lines on bankers’ bonuses, the NHS and tax cuts ready to launch.
Away from the state ceremony, political activity has been fraught. Downing Street sources said the new prime minister has, throughout the period of mourning, carried out a heavy load of desk duties. “When she has not been performing her constitutional role, she has been with aides and officials working on policy. She has a real energy to get on with things,” said a source.
At the same time, Tory MPs have been despairing at the early direction Truss has been charting. She has been overhauling the No 10 team and taking aim at the civil service. Officials have been frantically working on a huge economic announcement that is a budget in all but name.
All the while, senior opposition MPs have felt a deep sense of frustration that they have been unable to say anything about Truss’s plans. “Over this period, there have been all sorts of briefings about what the government says it is going to do, which have somehow emerged from somewhere – and we’ve just been sitting here very politely,” said one shadow cabinet minister.
Among some Tory MPs, there is already disbelief that Truss will go through with an economic programme they believe opens up clear ground for Labour to move into – framing the Tories as fiscally incontinent and favouring the wealthiest over average households.
Key among the concerns are £30bn in tax cuts that will disproportionately benefit the wealthy, the removal of green levies set to dent the Conservatives’ eco credentials and the end of a cap on bankers’ bonuses.
Tory MPs are already listing the campaigns they will face from opponents come the autumn.
“The removal of the green levies on fuel and the opening up of fracking – the whole environmental movement will start campaigning against Conservatives, even though we’ve been quite green,” said one MP, adding: “The lines of political attack for Labour are incredibly clear. Bigger bonuses for bankers. The cut in national insurance will primarily help people on higher incomes.
“The freezing of energy bills primarily helps people on higher incomes because energy bills are bigger. None of this is targeted. Honestly, it’s creating a complete open goal for Labour politically.”
Another warns that the spending splurge on tax cuts – which Truss and chancellor Kwasi Kwarteng will frame as part of a dedication to growing the economy – will hit the Conservatives’ key calling card. “Fiscal prudence, or sound money, is one of the defining characteristics of conservatism,” they said. “We are a party of sound money or nothing.”
While some wonder privately if Kwarteng is secretly working for the Labour party, one former minister dismisses the idea. “I totally disagree,” they said. “There is nothing secret about it.”
A source close to the Treasury described the plans as “very naive”. Meanwhile, Truss is unlikely to have much of a honeymoon. Several MPs pointed out that, in the first round of leadership voting among MPs, she managed to claim just 50 votes. There are 357 Tory MPs. Some Rishi Sunak supporters are already dreaming that their leadership candidate will soon be giving it another go.
The scrapping of the bankers’ bonus cap will be the target of unions and political opponents, having been announced at a time when swathes of workers are being handed real-terms pay cuts.
after newsletter promotion
Both Labour and the Liberal Democrats have ample material ready to go on the move. Ending the cap has been framed as a way of ensuring the UK remains a hub for top talent in the financial industry, but that is already being questioned.
“It is completely implausible that scrapping the cap could attract enough new bankers to Britain to make any meaningful difference to our economy,” said Luke Hildyard, director of the High Pay Centre thinktank. “We already have more high-earners in the sector than the rest of Europe combined, but whatever trickle-down effect exists isn’t sufficient to prevent the poorest people in the UK being significantly poorer than the poorest in Germany or France.”
Away from the economic plans, Labour is already planning a big campaign on the NHS this autumn, as the health service comes under strain. Thérèse Coffey, the new health secretary and deputy prime minister, is set to reveal her plans for the service this week. There have been suggestions she will replace or update the four-hour-wait target for A&Es. Insiders said she would not axe the target, but there are concerns within the service. Hospital leaders are now agitating for extra help.
“The clinical standards review has been a long time coming and so health leaders will welcome reports that our new secretary of state intends to pick this up but introducing new standards in themselves will not address the deep-rooted challenges facing the NHS,” said Matthew Taylor, chief executive of the NHS Confederation, which represents the healthcare system in England, Wales and Northern Ireland. Labour’s autumn campaign will focus on a “watering down of standards” through political underfunding and mismanagement.
Meanwhile, the dismissal of the Treasury’s top civil servant, Tom Scholar, continues to cause alarm in Whitehall and sets up an immediate tension with the new administration.
Many officials in Downing Street have also been moved out and replaced by political operatives, with Truss’s ally Coffey taking one of the closest offices to the new prime minister. Officials talk of a “chilling effect” caused by the Scholar dismissal. Some fear Truss will next target the Bank of England and other institutions standing in her way – another instinct causing alarm on her own benches.
Aides say Truss is prepared to take on critics who say now is not the time to cut taxes with the economy in a perilous state.
It all means that while Westminster rapidly changed gear when news of the Queen’s death broke, the return to political battling will be just as swift.