Rishi Sunak autumn statement: Prime Minister has to win support for tax rises, not just make them

Rishi Sunak lost the Tory leadership by offering harsh truths he will now have to act upon.

Tory members turned away from the Prime Minister in favour of his predecessor Liz Truss, who insisted everything would be fine.

Whereas Ms Truss promised the world, Mr Sunak instead spoke of difficult decisions and conceded things were not going to be easy.

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So it has turned out, with Ms Truss condemned to the shortest premiership of any Prime Minister, all on the back of her economic policy.

Rishi Sunak faces tough decisions to balance the books.
Rishi Sunak faces tough decisions to balance the books.
Rishi Sunak faces tough decisions to balance the books.

Now less than a week into his tenure, a report from the Resolution Foundation has warned Mr Sunak and his chancellor Jeremy Hunt face an “unpalatable menu” when it comes to rebalancing the nation’s finances.

It suggests the UK Government will need to find at least £40 billion – likely through a combination of tax rises and spending cuts.

The think-tank said the Office for Budget Responsibility could predict a recession next year, with GDP forecasts cut by up to 4 per cent by the end of 2024.

Unemployment could rise by around half a million, and borrowing could rise even further, reaching £20 billion a year by 2026/27.

For a party that prides itself on economic management, it’s terrible – and for the country it’s a disaster.

The pair will have to raise taxes once again, while Government departments are already bracing themselves for cuts to their spending.

Fortunately for Mr Sunak, he appears to have the support both in his own party and outside to deliver it.

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He enjoyed more support from MPs during the leadership contest despite losing the race, and those that didn’t are more likely to back him after the disaster of Ms Truss.

Then there is the public, who polling from BMG showing Mr Sunak is more trusted on the economy than Labour leader Sir Keir Starmer.

His party trail by 23 points for voting intention, but being open about the scale of the problem has delivered the new Prime Minister some goodwill.

Crucially, there is also little sign implementing austerity hurts support among the public, even if the consequences of it kill some of them.

Framing is everything, and Mr Sunak has the popularity and experience to deliver bad news in a way that maintains support in his own party and beyond.



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