The month of August is known by journalists as the ‘silly season’. With Parliament in recess and people generally away on holiday, newspapers tend to fill their columns with more lightweight news. Thus, in August, there are inevitably reports of sightings of great white sharks in Cornwall, or a lost cat manages to find its way from London back to its owners in Aberdeen.
This August, however, is very different. The Conservative leadership contest is in full swing, with Liz Truss and Rishi Sunak battling it out; and the printed and broadcast media are taking a very keen interest, much to the disappointment of those who traditionally regard high summer as an opportunity to take a welcome break from politics.
The campaign has already extended over four weeks and there are almost four more to go. The result will be announced on 5th September, when not only will the party have a new leader, but the country will have a new Prime Minister.
Depending on the outcome, there is also every prospect of a significant change in national economic policy. Until his resignation shortly before Boris Johnson stepped down, Rishi Sunak was responsible for the UK’s economic course and he has indicated that, if he becomes PM, there will essentially be no substantial change in the short to medium term.
At this point, I must come clean and make clear that I am supporting Liz Truss, not Rishi. I am doing so for a variety of reasons, not least the fact that I have huge respect for her work ethic and her grasp of detail. However, I also feel that Liz has a better approach to the economic challenges the country faces, not least the cost of living crisis sparked by the restart of the economy in the wake of the pandemic, exacerbated by the war in Ukraine and Russia’s squeeze on the energy supply.
Liz understands that this is no time to be overtaxing people and businesses. Her first act will therefore be to reverse the 1.25% increase in National Insurance contributions – announced last September, before Putin’s tanks rumbled into the Donbas – which costs the average family an additional £50 per month.
Further, she will scrap the forthcoming corporation tax increase from 19% to 25%, due to take effect in April 2023, which she believes will be damaging to British companies and to British competitiveness. She also proposes to announce regulatory and supply-side reforms, with a view to stimulating growth and averting the recession that the Eeyorish Bank of England Governor, Andrew Bailey, is lugubriously predicting.
It is indeed true that Rishi – who, at a personal level, I like immensely – assures us that he is instinctively a low tax Conservative and intends in the long run to reduce the standard rate of income tax from 20% to 16%. However, as Keynes observed: ‘In the long run we’re all dead.’
So my vote has gone to Liz. And I look forward to the end of the silly season.