Liz for Leader - what happens next?

The end is nigh. After what feels like an unnecessarily drawn out process, the Conservative leadership contest is slowly coming to a close. The winner - widely expected to be Liz Truss - will be announced on Monday. The victor will then travel to Balmoral on Tuesday for an audience with the Queen, where they will formally be asked to lead a new government; formed of new ministers, new priorities and new policies.?

With the result seemingly a forgone conclusion, the question on everyone’s lips is what will these new priorities and policies look like? Truss’ campaign has focused on broad brush statements, outlining her free market principles mixed with traditional Conservative values on crime and social issues. This has been at the expense of detailed policy in an effort to prevent her new administration from being boxed in by campaign commitments.

I was recently invited to a campaign event with Liz Truss, billed as an opportunity to hear what her priorities will be as the new Prime Minister. I wanted to share some reflections from the event and start to unpack what a Truss premiership will mean for the business community - particularly the development sector.

First, let us remember that it is normal for a candidate in a Tory leadership election to drift to the right, as they seek to shore up support from Party members who tend to be older, wealthier and more ‘small c’ conservative than the national average. The challenge for Truss is now keeping her promises to the Tory faithful, whilst seeking to govern pragmatically in the face of the looming cost of living crisis.

At the campaign event, Truss reiterated her commitment to immediately reversing the National Insurance increase and planned rise in Corporation Tax. This, she proclaimed, was the most expedient and effective way to ease the financial burden on both households and businesses. These tax cuts will be funded through additional public borrowing and - according to her leadership rival Rishi Sunak - risk fuelling inflation and exacerbating economic woes in the coming months.

In addition to these tax cuts, it has become clear that the government will also need to provide further, targeted financial support to protect lower-income households during a bleak winter. This is set to be outlined by Truss’ new Chancellor - rumoured to be current Business Secretary, Kwasi Kwarteng??- in mid-September. Expect immediate questions about how any further support will be funded, particularly from fiscal hawks who are already sounding the alarm that the government’s monthly interest payments recently hit ￡20bn. For context, this is almost double the monthly NHS budget of around ￡11bn.

Time will tell whether Truss’ unorthodox economic approach will pay dividends. If not, the electorate are unlikely to reward her with a second term following the next General Election - likely to be held in 2024.?

Truss’ comments on renewable energy have been widely reported and are likely to represent a significant shift from the previously announced Energy Security Strategy. Truss self-describes as a former “teenage eco-warrior” who remains committed to reaching net zero by 2050.??However, speaking at the aforementioned campaign event, she stated she wants to see an end to the “industrialisation of the countryside by solar farms.” Truss has called for solar panels on the roofs of commercial buildings as an alternative. This, however, is not a simple either/or choice. As those who have worked on solar projects can testify, the location of solar farms is primarily driven by the proximity of substations and grid connections. Even still, recent research from Solar Power Portal has highlighted that if every single current planning application for a solar energy farm was approved, it would equate to 0.4% of all agricultural land in the UK. This hardly suggests an industrialisation of the countryside and feels like a step backwards on the road to both energy security and net zero.??

And what of Truss’ position on planning and housing? As I stood and listened, Truss stated she wants to end the influence of “so called planning experts in Bristol” and instead let “local communities make local decisions about housing need.” Those who remember one Eric Pickles will recognise the familiarity of these words.

Her solution appears to be shifting housing targets from the overheated market in the south to new Investment Zones - benefiting from low tax status and relaxed planning rules to supercharge growth - in the North and Midlands. This sounds suspiciously like the already-enacted Enterprise Zones, introduced by the Coalition Government a decade ago to mixed reviews. Further detail on how Truss’ government will solve the housing crisis is certainly required. The new DLUHC ministerial team could do worse than start by reading this excellent analysis of the housing crisis, written by a man with first hand experience; their departmental predecessor, Neil O’Brien.

The proposed Investment Zones have also been touted as proof of Truss’ commitment to Levelling Up. However, much more will be required if the Government?is to build on the early work undertaken by O’Brien and his former boss, Michael Gove, to rebalance the UK’s economy. The commitment to delivering the ‘full fat’ Northern Powerhouse Rail project should be commended but, again, scant detail has been given as to the specifics, financing and timescales for this project. Recent exam results, which showed a widening attainment gap between the north and the south, provide further proof about the scale of the challenge ahead. Regeneration and infrastructure projects should, of course, be welcomed but they must be backed up with a renewed commitment to improving education, skills and training across the entire country if we are to truly realise our national potential.?

Truss will become the fourth Conservative Prime Minister in just over twelve years. She has sought to paint herself as the Boris continuity candidate, whilst also making clear that her government will be a break from business as usual. After the challenges of Brexit and COVID, the country now faces another major obstacle in the form of a cost of living crisis, fuelled by global supply chain issues and a war in Ukraine that shows no sign of abating. On top of this, she must also unite a party that has just undergone a very public and very bruising leadership contest. Will Liz Truss rise to the occasion, steer the county through difficult waters and secure a historic election victory??Or will Sir Keir Starmer consign Truss’ premiership to a damning historical footnote in a mere eighteen months’ time?

We are about to find out.