We have a new Prime Minister and his term will, by its very nature, be epic. The barnstorming mini-budget, just announced, shows that we’re looking forward to a rollercoaster ride.
She faces a set of challenges not seen since Mrs Thatcher came to power and perhaps more intense. I do not subscribe to Churchill’s references – we are not bombed or faced with invasion and subjugation – although Germany pursues its own agenda again and France becomes France again.
It will nonetheless be the ultimate battle Ms. Truss will face and in no time, a battle for nothing less than the future of the nation. There must be an uphill struggle grappling with the Blob: the recalcitrant Rejoiners, the vested interests of Whitehall, business and the city, and the leftist/liberal woke elite who occupy the media and quango land.
We had the great Quatre Bras skirmish, a political crossroads within the Conservative Party, and the Sunak gang has backed off for now. Waterloo is on the horizon.
Liz Truss staked her ground, the battle is for freedom, free markets and growth, against socialism, statism, control and – to use a phrase – the great vampire squid that is the EU.
In order to win this fight and the upcoming elections, the Prime Minister and his ministers will need sheer determination, an almost psychopathic focus, in order to drive dramatic change and produce observable results, in a short period of time.
Anything less and there won’t be enough time to fight politics in Parliament, to see tangible results and put them in the crucible of the next election.
There will be no room for weak hearts in cabinet or half-baked efforts, the tight ranks of the establishment will produce enough molasses to slow down a freight train, so momentum will be critical. Mistakes will be made and the first casualty of the battle will be the plan, only a laser focus on the desired results will see the desired results.
The economy is everything and the new Prime Minister’s obsession with it is well founded. Without economic growth, Trussenomics will fail and the country will end up in a mess of stagflation and debt. With economic growth, we can pay off one-time debts generated by Covid lockdowns and the energy crisis and at the same time generate taxes to pay for the public services people want: health care, defence, police. More importantly, growth will create prosperity and jobs.
To win the battle and get to the sunny highlands, it will be necessary to pursue a radical program. Serious deregulation across the economy, not just in the city, will be needed to free enterprise, including liberalization of the planning system. Reducing corporate tax beyond the current reduction will encourage investment and level the playing field; after all, it is a tax paid by British companies and avoided by multinationals. Corporate rate relief or job cuts at NI employers would help thwart energy cost increases – much better than intervening in the market and distorting it in the process.
However, short-term measures are justifiable under the circumstances. Whatever the question, market distortion is never the answer. The government should also scrap green levies and stop subsidizing renewable energy. The current cost of living crisis is entirely a consequence of choosing the most expensive path to Net Zero, high cost renewables and leaving the UK energy insecure. The government and many members of the Blob have yet to accept this inconvenient truth.
The urgent development of a massive nuclear program coupled with the extraction of oil and gas in the short, medium and long term from the North Sea and natural shale gas reserves should lead us towards a net zero future, at least cost.
Income tax cuts will certainly stimulate demand and encourage work. Better access to funding for next-stage growth would also give the company a boost. It is vitally important that the government creates a corporate environment in which winners choose themselves – the last people in the world able to choose winners are in Whitehall. If there is trust in enterprise zones, why not make the whole country one enterprise zone?
The promotion of high-level science and technology education and training should be a long-term objective.
Finally, resolving the remaining issues related to Brexit: the Northern Ireland Protocol and fisheries should be a goal for the future.
It is a vast program and if Mrs Truss fails it will be a lost opportunity for at least a generation, if not forever, to see Britain emerge as a place to do business, an example of free market prosperity.
Success will mean that Brexit has brought practical and observable benefits beyond freedom and self-determination. Failure will see the little Napoleon across the Channel celebrate in Brussels, a rewriting of history, and the fifth column in the UK scrambling to join the failing European project.
No pressure Liz!
John Longworth is chairman of the Independent Business Network of family businesses and former chief executive of the British Chambers of Commerce