The sound of Tory knives sharpening is echoing round Westminster, Whitehall and constituency Conservative Clubs following today’s double-whammy to the party’s fortunes and future.
A new poll has revealed the government’s performance has seen a surge in support for the Labour party, while reports abound that the chancellor is set to explode a tax bombshell under traditional Tory monetary policy.
A poll by Opinium, published today in the Observer shows Boris Johnson’s government’s 26 point lead over Labour has disappeared with the two parties now on 40% each. The Lib Dems have a new leader – Sir Ed Davey – but languish at 6% in the poll.
“It is becoming increasingly difficult for backbenchers now to promote and defend government policy as so often that policy is changed or abandoned without notice,” said none other than the vice chairman of the hugely influential backbench 1922 Committee, Charles Walker. He told the Observer: “Whether this approach is by design or by accident, the climate of uncertainty it creates is unsustainable and erodes morale.”
‘Govt licks its finger and sticks it in the air’
Commenting on the recent prevalence of U-turns, Walker said the government’s performance is making it “increasingly difficult for backbenchers now to promote and defend government policy as so often that policy is changed or abandoned without notice. Whether this approach is by design or by accident, the climate of uncertainty it creates is unsustainable and erodes morale.”
The vice chairman told the Observer: “Too often it looks like this government licks its finger and sticks it in the air to see which way the wind is blowing. This is not a sustainable way to approach the business of governing and government.”
The paper then quotes another “1922 committee source” saying the party needs “to take the temperature on Tuesday and Wednesday [when parliament reconvenes] and then decide what the plan of action is”, suggesting the backbenchers’ approach is not too different to that of the government they are complaining about.
‘Treasury pushing for historic tax grab’
However, of further concern to the 1922 Committee will be today’s series of reports suggesting chancellor Sunak is planning what the Telegraph describes as an “historic tax grab” with the Treasury set to “push for a raid on capital gains, pensions, internet sales, fuel and inheritance.”
Tories aren’t supposed to raise taxes – they cut spending instead – yet the report claims the costs of dealing with the coronavirus pandemic will see “the largest tax rises in a generation”.
A “proposed quintuple whammy of tax increases” could net No11 “at least £20 billion a year”, but, the Telegraph reports “fierce opposition in No10” to the proposals with the suggestion the PM would prefer spending cuts instead of tax hikes.
The issue falls within the wider debate as to where the burden of taxation should apply – should “earned income” from labour be taxed heavier than “unearned income” from assets?
UK needs ‘real substantive change’ – IFS
The director of the Institute for Fiscal Studies Paul Johnson said: “We’ll need tax rises eventually but this [Autumn’s] budget seems unlikely to be the moment when they’ll be announced, at least for 2021, because of the uncertainty over the state of the economy.
“Secondly, the scale of the deficit and the respective spending demands are such that tinkering with small tax rises isn’t going to cut the mustard in the next four or five years.
“It’s going to have to be real substantive change.
“The trick they need to play in this budget is to get the right level of stimulus as opposed to the reverse, whilst persuading people that they are taking seriously the need to deal with the deficit in the medium run.”