Prime Minister Rishi Sunak named an experienced Cabinet to lead the United Kingdom through what he called a “profound economic crisis,” only to face immediate criticism for reappointing a series of scandal-hit former ministers to senior government jobs.
Sunak confirmed Jeremy Hunt would remain chancellor of the Exchequer, as the new PM vows to “fix” the economic mistakes made by his predecessor Liz Truss. Downing Street later said the government would need more time to present the full budget – deferring a Treasury statement due next Monday to mid-November.
That fiscal statement is seen as crucial ahead of a Bank of England interest-rate decision. The prime minister and chancellor still need to decide on the timetable, a person familiar with the discussions said. It was Truss’ effort to cut taxes at the same time as ramping up spending on energy subsidies that spooked markets last month and precipitated her ouster.
Overall, Sunak sought to display a steady hand on the tiller by reviving the political careers of well-known Conservative politicians who had left government under the Truss and Boris Johnson administrations. Some 12 members of the new Cabinet served in David Cameron’s government between 2010 and 2016.
Michael Gove returned as levelling-up secretary, a job with responsibilities for narrowing regional income and wealth gaps, and Dominic Raab was restored to his dual role of justice secretary and deputy prime minister. Raab has previously sought a British Bill of Rights to replace the Human Rights Act now that the country has left the European Union.
There was some continuity with the short-lived Truss government too, as the holders of the three so-called "great offices of state" remained in their posts.
Alongside Hunt, James Cleverly was retained as foreign secretary. But it was the reappointment of Suella Braverman as home secretary that drew consternation. Just hours after Sunak had promised to put “integrity, professionalism and accountability” at the heart of his government, he reversed Truss’ decision to fire Braverman over a security breach last week.
Sunak struck a deal at the weekend to give her the job back in exchange for her support in the Tory leadership contest, a pivotal moment that put him on the path to No. 10, according to people familiar with the discussions. The prime minister’s office declined to comment.
Grant Shapps had expected to be given the job following his own endorsement of Sunak, according to one of the people. He was instead appointed as business secretary.
Braverman’s counterpart in the Labour opposition, Yvette Cooper, said her appointment showed Sunak was putting “party before country.”
Three other ministers who were previously forced to resign were also invited to return to government.
Gavin Williamson, the former defence minister who was sacked by Theresa May over another security breach, was made a Cabinet Office minister. Andrew Mitchell was appointed as international development minister a decade after he left government following a row with a police officer. Mark Harper, who quit David Cameron’s government in 2014 after it emerged his cleaner was in the country illegally, was made transport secretary.
The new prime minister used the reshuffle to reward a host of his allies. Oliver Dowden, one of Sunak’s closest political friends, was appointed as a minister in the Cabinet Office. Another, Steve Barclay, was made health secretary. Mel Stride was put in charge of work and pensions.
Yet there was no promotion for Penny Mordaunt, Sunak’s rival in the Tory leadership contest. She had wanted to be foreign secretary but was only offered a more junior role, so rejected it to stay as Leader of the House of Commons, a person close to her said.
Just seven out of 28 positions in the Cabinet went to women. Only two Cabinet ministers represent constituencies in the north of England, despite Sunak’s hopes to appeal to the northern voters who backed the Tories at the 2019 general election.
A Downing Street official said the Cabinet included talent with significant experience from across the party.
“The government I lead will not leave the next generation – your children and grandchildren – with a debt to settle that we were too weak to pay ourselves,” Sunak said in a speech in Downing Street after taking power.
After Truss’ premiership imploded, a quick coronation saw Sunak installed as Conservative Party leader on Monday and as prime minister on Tuesday.
Nothing tells the story of Truss’s ill-fated premiership better than than the yield on 30-year gilts, which spiked dramatically in the wake of her mini-budget last month, forcing the central bank to step in with emergency bond purchases.
With Sunak now prime minister, yields have now dropped back close to where they were before September’s ill-fated fiscal plan.
Hunt junked the bulk of Truss’s economic strategy, including scrapping cuts to income taxes, as well as dramatically scaling back her energy support programme. The moves amounted to £32 billion (US$37 billion) of savings, as Hunt tried to restore the UK’s fiscal credibility.
He may still have some work to do. The government needs to find another £36 billion of savings to get back on the pre-Truss trajectory, according to analysis by Bloomberg Economics.
by Alex Wickham, Joe Mayes & Ellen Milligan, Bloomberg