Tensions in Team Truss Emerge With 10 Downing Street in Reach

Alex Wickham
·6 min read
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(Bloomberg) -- Liz Truss’s campaign to be UK prime minister has appeared straightforward, with promises of tax cuts and optimism in the face of an economic crisis helping her to a comfortable poll lead over Rishi Sunak.

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But behind the scenes, disagreements are emerging just as Truss’s camp starts to look beyond the Conservative leadership contest to taking power on Sept. 6. Aside from the usual and expected jostling for government jobs, there are now fundamental divisions over how to help Britons struggling with soaring prices this winter, people familiar with the matter said.

Truss Went From Anti-Thatcher Protests to Become UK Tory Darling

With the economic outlook getting steadily worse, supporters of Truss’s small-state, low-tax plan for Britain are trying to ensure she stays the course, amid warnings from other allies that approach will become untenable.

Britain’s cost-of-living crisis has leaped to the top of the political agenda, and on Friday, the energy regulator Ofgem said household payments for electricity and natural gas will be almost triple this winter the level they were last year. Truss so far has kept quiet about exactly how her government would help the millions of people who may tip into poverty and struggle to pay for essentials.

In interviews and at leadership hustings, the foreign secretary has repeatedly refused to explain how she would structure any new state support beyond tax cuts. Writing in Friday’s Daily Mail newspaper, Truss promised “immediate support” if she becomes premier, but in a hustings late Thursday she said that while energy prices are a “massive issue” for people, “what isn't right is to just bung more money into the system.”

Allies including Kwasi Kwarteng, widely expected to be her Chancellor of the Exchequer, have also hinted at further measures but without giving details.

One factor in the secrecy is that Truss’s supporters do not agree on how far she should go, according to people familiar with their thinking. A spokesperson for her campaign declined to comment.

‘Handouts’

Truss, who draws much of her support from the ideological right of the Conservative Party which still idolizes former leader Margaret Thatcher, favors tax cuts over what she has described as “handouts.”

One of the people said in contrast to Boris Johnson, who enraged many Tories with his indecision on spending versus fiscal conservatism, she would be the most ideologically clear-minded premier in the last 40 years.

Yet a person involved in her campaign said it was inevitable Truss will have to announce more aid, probably funded by more borrowing. That’s because public expectations of state intervention shifted in the pandemic after Sunak, who was Chancellor of the Exchequer at the time, rolled out expensive furlough and other programs to keep households and businesses solvent.

One Tory Member of Parliament, who voted for Truss early in the leadership contest, fears her opposition to handouts would stay with her in office and risk handing political opponents an advantage. Keir Starmer’s Labour Party, which leads in most national polls, has pledged to freeze energy prices.

The MP said they’re worried a Truss government would turn Britain into an experiment on whether the Laffer curve theory — that lower tax rates can lift government revenues by spurring people to work and invest more — could help solve a cost-of-living crisis.

Short Premiership

Another Truss-backing MP said this winter would be her main test in office, warning that failing to offer adequate support could lead to social unrest and bring her premiership crashing down within six months.

According to one person working in Truss’s campaign, the method and extent of support remains a live issue. Some members want to limit it to pensioners and the most vulnerable, while others favor a more generous pandemic-style package extended to the middle class. The team is also exploring creative ways to keep the cost off the government’s balance sheet.

The question of who would hold power in a Truss administration is also crucial to the decision-making process. While a small number of figures from the center of the Tory party would be appointed to her Cabinet, the vast majority of roles will go to loyalists on the right, a person familiar with her plans said.

Along with Kwarteng, who has a long history of working with Truss, there will likely be prominent jobs for Therese Coffey, Simon Clarke, Suella Braverman, Jacob Rees-Mogg, David Frost, James Cleverly, Iain Duncan Smith, Kemi Badenoch and John Redwood.

One risk is that Truss struggles to unite the party if she takes office. A Tory official who spoke on condition of anonymity also questioned whether her campaign rhetoric and, for example, Frost’s calls for small-state government could be reconciled with public expectations for ministers to intervene.

Team Grumbling

There are also grumblings about the team of advisers Truss is expected to appoint. While campaign officials insist relations remain positive, clear groupings have already formed among her likely top team.

Mark Fullbrook, a veteran Tory aide who worked for Australian strategist Lynton Crosby and helped Johnson’s own leadership campaign in 2019, is widely tipped to be her chief of staff. He would likely be supported by another Crosby protege, David Canzini, who also worked for Johnson.

But the potential promotion of Crosby alumni to the top of No. 10 has surprised some of Truss’s longer-term backers. Fullbrook might be an effective campaigner but he has little experience of government, and his appointment might only be temporary, a person familiar with the matter said.

Fullbrook did not respond to a request for comment.

Other key positions are likely to go to Jason Stein and Ruth Porter, two Truss allies who work for the advisory firm Finsbury Glover Hering.

A third grouping is Truss’s team of special advisers at the foreign office, who are younger and likely to fill communications, parliamentary management and policy roles. They include Adam Jones, Sophie Jarvis, Sarah Ludlow, Jamie Hope and Hugh Bennett.

Describing the distinct parts, one Truss backer said three acronyms would be fundamental to her administration: CTF (Crosby’s old firm Crosby Textor Fullbrook), IEA (the Institute of Economic Affairs free-market think tank) and ERG (the European Research Group of Brexiteer Tory MPs).

Whether such an ideological government made up of competing factions can meet the public’s demands this winter is open to question, the supporter said.

(Adds Ofgem announcement in fourth paragraph.)

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