London Playbook: London calling — Brace, brace —
Liz vs. the Libs
BY ESTHER
WEBBER
AUGUST 31,
2022 8:02 AM
POLITICO
London Playbook
By ESTHER
WEBBER
https://www.politico.eu/newsletter/london-playbook/london-calling-brace-brace-liz-vs-the-libs/
PRESENTED
BY
UK
Fisheries
IN
MEMORIAM: The world today remembers the last leader of the Soviet Union,
Mikhail Gorbachev, who died yesterday at the age of 91. As the man who
effectively allowed the Cold War to come to a peaceful end there are plenty of
weighty obituaries around — read POLITICO’s here, where David Cohen writes that
Gorbachev “shook up a nation that had never fulfilled most of its promises to
its people and created a seismic shift in international relations, altering a
world that been locked in a nuclear stare-down for four decades.”
Paying
tribute: Boris Johnson compared Gorbachev’s record of peace to Vladimir Putin’s
war in Ukraine, tweeting that “his tireless commitment to opening up Soviet
society remains an example to us all.” Liz Truss added that his “legacy of
cooperation and peace must prevail.”
But there’s
also a dark side to Gorbachev’s legacy. As my Brussels Playbook colleagues
write this morning, on Gorbachev’s watch, Soviet troops brutally massacred 22
protestors in Tbilisi in April 1989; in Azerbaijan, the military killed 150
people in the Black January massacre in 1990. Gorbachev is also often reviled
in Lithuania for the January 1991 massacre in which 14 civilians were killed by
the Soviet army — and in Latvia, for the killing of five people, also in
January of that year.
Good
morning. This is Esther Webber with you for the rest of the week.
**A message
from UK Fisheries: For decades, British fishers have plied their trade in
bountiful Greenlandic waters, but despite the Government’s pledges of new
post-2019 ‘Seas of Opportunity’ our distant waters fleet is now completely shut
out while others fish on. We can and must do better – and here you can read
how.**
DRIVING THE
DAY
LONDON
CALLING: All good things come to an end, and so does the Conservative Party
leadership contest. It’s the last hustings tonight in London, in what seems
likely to be a valedictory outing for Rishi Sunak and a victory lap for Liz
Truss. While Team Sunak stresses his work ethic to the last, Truss’ attention
is firmly on two tasks ahead: the cost-of-living juggernaut and preparing for
the next election as the Liberal Democrats begin to peer over the blue wall.
Reminder:
The ballot of party members closes at 5 p.m. on Friday and the winner will be
announced Monday. This time next week, they will have their feet firmly under
the desk.
Party
atmosphere: We’re not sure whether it’s completely tone-deaf or a good
distraction from everything else, but Playbook hears there will be a DJ set for
half an hour before the hustings kick off in London. “They’re just playing
music. It’s not like Tiësto or anything,” a Conservative Party official
commented when asked for the setlist.
Liz’s
summer of love: Ahead of the final bid for votes, a member of Team Truss said:
“Liz has loved traveling around the country to take part in the hustings,
meeting members and answering their questions about her plan for the future.
She’s really looking forward to the final one tonight and the chance to explain
how she will make sure London thrives.”
The harder
they come: A Sunak campaign member said: “If Rishi wins it will be what they
call a ‘hard win’ — he’s done 130 events plus the official hustings. We think
he’s met 30,000 members over the last six weeks.” They estimated Truss has done
less than half of Sunak’s member events.
Last pitch
effort: Sunak himself put out some words, sticking to his tough-on-inflation
message. He said: “I have been consistent, clear and honest throughout this
contest that we must fix inflation first. Only by supporting people through
this winter and gripping inflation can we lay the foundations for growth and
prosperity — for lower taxes, a better NHS and a healthy economy making full
use of our Brexit freedoms.”
BRACE,
BRACE: The pressure awaiting the next prime minister is being ratcheted up yet
again with a series of stories laying bare the dilemmas they will face. There’s
a twin-pack of bracing dispatches from Bloomberg, with David Goodman reporting
on a prediction from Goldman Sachs that inflation could top 22 percent next
year, while Alex Wickham and Todd Gillespie have got hold of some jaw-dropping
Treasury documents suggesting gas and electricity companies could make excess
profits of up to £170 billion pounds over the next two years.
A cold wind
bloweth: The Treasury said it did not recognize the analysis, but regardless of
precise figures the story highlights how tough Truss will have to stand in
order to resist demands for a new windfall tax. Any fresh levy on profits is
something she has set her face very heavily against, as has Kwasi Kwarteng, the
business secretary and chancellor presumptive.
Small
businesses’ big problem: Smaller companies are looking at a rise of around 400
percent in their energy costs, industry heads warn the i’s Richard Vaughan,
Chloe Chaplain and Ben Gartside. Business owners are calling on the government
to spell out how it will support them while Truss remains tight-lipped on the
specifics. A business rate rebate similar to the council tax version for
households is one of the most likely options, the i team hears.
Pubs call
time: The problem is only going to be thrown into sharper relief in the coming
weeks as an increasing number of pubs and hotels announce they are being forced
to close. In the Mirror, Lizzy Buchan has spoken to head teachers and NHS
bosses who fear they will have to cut staff to pay school and hospital energy
bills.
And there’s
more: Grim reading in the Guardian, which splashes on Josh Halliday’s report
that food banks across the U.K. have warned of a “completely unsustainable”
surge in demand that will prevent them from feeding the hungriest families this
winter. Not to mention Andrew Gregory’s detailed read on the NHS, which sums up
the situation thus: “The overriding problem for the new Downing Street
incumbent is that, while in previous years problems in the NHS centered on
specific areas, today the entire house is on fire.”
Tough sell:
Things are looking so bleak even the prime minister has admitted it. Boris
Johnson was in Dorset yesterday pointing at a big hole (insert your own jokes),
where he told reporters: “It is going to be tough in the months to come. It’s
going to be tough through to next year. And that’s because of Putin’s war in
Ukraine. Be in absolutely no doubt, the gas prices [are] being driven by what
Putin did in Ukraine. But we are going to get through this.”
The
message: Johnson is obviously anxious about the impact which the strictures of
the coming months will have on public support for helping Ukraine through
sanctions and military cooperation, and wants to underline that to his
successor. In case that all seems a tad doomster-y, the PM has given an
interview to the Express’ Sam Lister and Gary Jones in which he says the
British people are “heroic” and will get through the winter before the country
bounces back “strongly.” More on that later.
Coming
storm: Playbook was chatting recently to a Conservative strategist about the
scale of the challenge facing the new PM. Their topline warning was blunt:
“This makes COVID look relatively straightforward.” They noted there was a
certain irony in Truss triumphing on the back of her free-marketeer credentials
when “initially it’s just got to be, let’s bail everybody out … there will be a
near-nationalization of energy companies. I would be shocked if we didn’t see
BEIS officials on the boards for six months or something like that.”
Competence
wanted: The same strategist observed: “In the early stages of the race it was
all about criticizing gender identity and engaging in conversations about free
speech. Why is anybody talking about this when people are looking at October
thinking ‘I’m going to be wiped out’?” It is a time, they added, for “competent
government” and “MPs can’t say they don’t know Rishi and they don’t know Liz,
and nor can members. You might not think Rishi is a great retail politician but
he’s basically got his act together. Liz hasn’t demonstrated that.”
Mark my
words: On the front of the FT, Sunak tells George Parker and Sebastian Payne it
would be “complacent and irresponsible” to ignore the risk of markets losing
confidence in the British economy. He accuses his rival of making unfunded
spending commitments that could force up inflation and interest rates and
increase U.K. borrowing costs, and says he “struggles to see” how Truss’
promises “add up.” No offense to our pals at the FT, but the choice of outlet
reads a bit like preaching to the choir at this stage.
Repair Kit:
While the PM talks up his achievements and the chancellor pays a visit to the
U.S., Kit Malthouse has been busy with cross-departmental planning. The
chancellor of the Duchy of Lancaster held a meeting yesterday with ministers
and officials across the big departments to discuss “priority risk areas,” such
as health, energy supply, cost of living, supply chain disruption, labor market
shortages and industrial action — all of which are set to collide over the next
18 months.
Coming up
Malthouse: A Cabinet Office official said Malthouse “is continuing to drive
forward planning for this winter” and “identifying the key operational
decisions that can be taken quickly once a new administration is in place to
reduce the impact on the public of the global rise in energy prices.” Malthouse
has told colleagues it is essential for departments to “maintain pace and grip
on this essential work” and that tackling these challenges will be “a marathon
not a sprint.” We can’t help wondering which job he’s eyeing up.
Fantasy
Cabinet latest: The Express’ David Maddox reckons Jacob Rees-Mogg is in line
for promotion to business secretary in a Truss administration. As Maddox points
out, this would cast some doubt on the future of net zero, with Rees-Mogg said
to be keen on ending the embargo on fracking and new oil exploration.
PROTOCOL
BILL BATTLE: My POLITICO colleague Cristina Gallardo has a great preview of the
first major parliamentary battle awaiting Truss, as peers prepare a
full-frontal attack on the government’s plans to rewrite the Northern Ireland
protocol when parliament returns from its summer break.
Getting
ready: At a crunch meeting behind closed doors next week, senior peers —
including leading ex-judges and barristers — will agree their strategy to try
to take down the bill, with peers divided between voting it down completely at
its second reading, and amending it heavily and sending it back to the House of
Commons with a stark message of disapproval.
Timeline:
As Cristina outlines, the protocol bill sailed through the Commons this summer
with no amendments, and is due to arrive in the U.K. parliament’s upper chamber
for its first debates after the political party conference season in early
October. Assuming peers settle on amending the bill rather than trying to block
it, it could take 11 days to get to third reading. Ping-pong, the process by
which the bill is sent back and forth between the two houses as they try to resolve
disagreements, could then take several more weeks, potentially delaying the
bill’s passage until the end of the year.
The
targets: Two aspects of the bill are driving their concerns: the U.K.’s plan to
use the legislation to switch off parts of the Northern Ireland protocol —
which many observers believe would amount to a breach of international law —
and the significant delegated powers ministers would gain under its provisions.
All eyes on
Labour: The bill’s ultimate fate could depend on the Labour Party, which has
been cautious under Keir Starmer’s leadership not to take up positions which
could be portrayed as siding with the EU against Britain. For more of the
nitty-gritty, sign up to Cristina’s weekly email on EU-U.K. relations.
**What does
the Tory leadership race mean for your industry? Our POLITICO Pro experts offer
you granular insights into what the future legislature will look like and how
it will impact your business. Learn more on POLITICO Pro here.**
LIZ VS. THE
LIBS
SURREY NOT
SURREY: The cat was set loose among the pigeons yesterday with the news that
the Lib Dems are preparing for a possible by-election in Michael Gove’s Surrey
Heath seat, as sniffed out by the News Agents’ Lewis Goodall. A Conservative
source told the Guardian’s Peter Walker and Pippa Crerar in no uncertain terms
that he is not intending to step aside. But Gove, who has made his feelings
about Truss clear, is unlikely to get another big job under her leadership, and
might just fancy a return to journalism.
SCOOP —
WATCH LIST: That’s not all. A senior Lib Dem official confirmed to Playbook
that the party is undertaking similar preparations in five other seats they
have identified as potential by-election territory. These are: Tamworth, where
Chris Pincher is the MP; Johnson’s Uxbridge seat; North East Somerset, where
there has been some (wild) speculation over a peerage for Rees-Mogg; Nadine
Dorries’ Mid Beds, also the center of peerage rumors; and Selby and Ainsty,
where Nigel Adams has confirmed he will stand down in 2024 but could head for
the Lords sooner. The Lib Dem source said hopefuls in these places would be
subject to the more rigorous checks and media prep that come with the spotlight
of a by-election compared with a general election.
Raab
rumors: No such measures are necessary in top Lib Dem target Esher and Walton,
where they are sticking with candidate Monica Harding, who cut Justice
Secretary Dominic Raab’s majority to 2,743 in 2019. The rumor mill is in
overdrive there, too, where the chat from local Tory activists is that Raab
could be in line for a peerage since he is out of favor with Truss and facing
an uphill battle to hang on to his seat. One Conservative councilor even posted
on TikTok about wanting to be the next candidate before hastily deleting it. A
source close to Raab gave the gossip short shrift, saying he was “certainly”
going to stay and defend his seat.
Tricky
customers: The Tory source who spoke to the Guardian called the Lib Dems’
maneuvers “yet another example of [their] dirty tricks.” A Lib Dem official
responded this was “an odd way to talk about selecting candidates.”
SOUTHERN
DISCOMFORT: Some argue that Truss needs to do more to shore up her rep in the
south than in the north — a point she appears to accept with a piece for
ConHome promising more money for the Lib Dem unit in CCHQ. She has made much of
her inside knowledge of the Lib Dems’ tactics on the campaign trail, but
further work may be needed. A Lib Dem official pointed to the number of
blue-yellow marginals where the sitting MP had endorsed Sunak, saying that
“because Truss is seen as the continuity Johnson candidate, she’s probably got
to do more to reassure blue wall MPs.” A Tory MP in one such constituency said:
“I think Liz has a lot of work to do to prove she can win socially liberal,
fiscally conservative seats.”
Red and
blue Cabinet: The i’s Arj Singh reports Truss wants to assemble a “Cabinet of
all the talents” that will help her win in red wall towns in the north as well
as traditional and rural Tory seats in the south, in a potential departure from
Johnson’s right-wing Brexiteer-heavy team. There’s more in that vein from the
Express’ David Maddox, who says influential Northern Research Group leader Jake
Berry is being lined up for party chairman.
Good luck
with that: The truth is Truss has strengths and weaknesses on both fronts, and
it is maintaining the coalition forged in 2019 which is going to prove
difficult. As outlined in this POLITICO piece last week, delivering tax cuts
for wealthier traditional Tories and major rail infrastructure in the north is
going to be a tall order, to say the least.
BEYOND THE
LEADERSHIP RACE
PARLIAMENT:
Still in recess.
THIN BLUE
LINE: The prime minister is scrambling to demonstrate he has delivered on key
manifesto promises as he puts in an appearance with new police officers today.
He is expected to speak to officers from one of the 20 Violence Reduction Units
set up by his government, saying: “We are cracking down on vile gangs and
putting dangerous offenders behind bars for longer — and at the heart of these
efforts are the 20,000 new officers who will be out on the streets providing
the firepower for years to come in the fight against crime.”
Unfortunately
for him: The front of the Daily Mail has other ideas, where David Barrett
writes up a warning from a former senior officer that British policing has
“lost its way’” and the public feels forces have all but given up on crimes
such as burglary. Confidence in the police is being damaged by “woefully low”
clear-up rates for house-breaking and robbery, according to David Spencer, who
has written a damning report on the subject for Policy Exchange.
Is this
helping? The Johnson interview with the Express mentioned above is headlined,
tantalizingly, with an assurance that he won’t be popping up in government
again. However his words further down are a lot more ambiguous, declaring: “I’m
going to be there to help them, to support in any way I can and I mean that —
it’s open support … I will basically be supporting the new administration but I
think the new administration … my clear impression is that whatever happens the
new administration will be delivering on the agenda — that’s the key thing.”
Got that? Good.
One last
thing: The PM is expected to make an intervention on energy security later in
the week, with all eyes on Sizewell C. The Times’ Chris Smyth and Emily Gosden
report Johnson is likely to approve the nuclear power station, which could cost
up to £30 billion, imminently. The Telegraph’s Daniel Martin has heard nuclear
power stations could be fast-tracked under new planning rules in an effort to
help solve the energy crisis.
LABOUR
LAND: The opposition will be cheered by a Deltapoll survey splashed on the
front of the Mirror, which finds 82 percent of people want the government to
freeze the energy price cap at its current £1,971 average a year. One in four
people told the survey they will “definitely” not be able to afford the rise
and another 40 percent said they would “probably” not be able to find the extra
money, Graham Hiscott reports.
Starmer on
the pitch: Keir Starmer will be on the Jeremy Vine Show on Channel 5 this
morning taking listeners’ calls — a different type of contact sport after
showing up for a LOTO five-a-side football game last night.
SCOOPLET —
Starmer hire: Peter Hyman is joining the Labour leader’s office in September as
the party gears up to fight the next general election. A senior Labour Party
official said: “Peter has experience both of being part of the team that won the
landslide victories of 1997 and 2001 and working at No. 10. In recent years he
has been a teacher, headteacher and social entrepreneur in education, setting
up two schools and a charity developing speaking skills in young people.”
ICYMI: Ben
Nunn, Starmer’s former chief of staff, wrote for the Guardian on how Starmer
should handle Truss. Spoiler alert: It’s all about the economy.
Feel the
Bern: Former U.S. presidential hopeful and father of a thousand memes Bernie
Sanders will join the RMT’s Mick Lynch for a rally at the TUC’s headquarters in
London tonight. Ahead of his appearance he spoke to the Guardian’s Owen Jones,
saying that Lynch’s efforts have been “hitting a nerve, because people are
tired of being ignored while the rich get richer.” Postal workers are on strike
again today after walking out on Friday. Royal Mail said the CWU had rejected a
pay rise offer “worth up to 5.5 percent” after three months of talks.
IDEAS FOR
RENT: The Department for Leveling Up has launched a consultation on proposals
for a rent cap for social tenants. Under the plans, a cap on social housing
rent increases would be implemented for the next financial year, at either 3, 5
or 7 percent. Housing Secretary Greg Clark said: “We know many people are worried
about the months ahead. We want to hear from landlords and social tenants on
how we can make this work and support the people that need it most.” Inside
Housing’s Stephen Delahunty has a write-up.
There’s an
app for that: The Times’ Chris Smyth has got hold of ministers’ latest plans to
cut backlogs for routine care by enabling patients to use the NHS app to shop
around for hospitals with the shortest waiting lists. Health Secretary Steve
Barclay wants to give patients “real-time data” on their phones so they can
decide whether to travel further to get quicker treatment for non-urgent
procedures, Smyth hears.
Keeping the
lights on: Councils are facing massive increases in costs due to spiraling
inflation and the increase in energy costs, the Local Government Association is
warning today. New analysis by the LGA and the Association for Directors of
Environment, Economy, Planning and Transport found that the costs of street
lighting, filling potholes and building new roads have soared, causing pressure
on stretched council budgets and delaying works.
AUKUS
TALKS: Britain’s Defense Secretary Ben Wallace will host his Aussie counterpart
Richard Marles, who is also the new deputy PM, in the North West of England
today, as part of his first visit to the U.K. since the new Labor government
took office in Canberra at the end of May. Cristina Gallardo texts in to say
the pair will discuss boosting defense capabilities, including through the
AUKUS alliance also involving the U.S. and through a U.K.-Australia collaborative
effort to build Type 26 and Hunter Class warships aimed at tackling security
threats in the Indo-Pacific. The two ministers will attend together the
commissioning ceremony for the submarine HMS Anson in Barrow-in-Furness, and
give a joint press conference around 4.45 p.m. U.K. time. Marles will also be
on Times Radio at 8.35 a.m.
FLOOD OF
CRITICISM: Sarah Champion, Labour chairwoman of the international development
committee, has written to the foreign secretary over what she calls an
“embarrassing” response to the catastrophic floods in Pakistan. “The
government’s risible response to this humanitarian disaster arguably amounts to
nothing,” she says.
FAMINE
WARNING: There was an arresting report from Channel 4 News’ Jamal Osman last
night on the Horn of Africa, which is currently suffering its worst drought in
40 years. More than 20 million people are at risk of starvation, according to
the U.N.’s World Food Program, with Somalia the worst-affected country.
BEGUM PLOT
THICKENS: Probably the wildest story in today’s papers comes via the Times’
Fiona Hamilton and Dominic Kennedy, who relate claims that a spy working for
Canadian intelligence smuggled Shamima Begum and her two friends from Bethnal
Green into Syria, and Britain later conspired with Canada to cover up its role.
There are now calls for an inquiry, after it emerged that Canada knew about the
teenagers’ fate but kept silent while the Metropolitan Police ran an
international search for them.
ROAD RAGE:
The backlash has begun after the Sun revealed yesterday that senior Cabinet
ministers who have armed protection will lose their bulletproof Jaguars next
year and see them swapped for German-produced Audis. Labour MP John Spellar,
who represents Jaguar Land Rover workers in the Black Country seat of Warley,
told Harry Cole the decision risks U.K. jobs.
UKRAINE
UPDATE: Fighting in Ukraine is newly focused in Kherson, where Ukrainian troops
are attempting to retake the Russian-occupied region. Kyiv’s much-anticipated
counteroffensive launched yesterday and led to street fighting in the southern
city, which was the first to fall when Russia began its assault in February.
The Times’ Marc Bennetts has the details.
NEWS AGENTS
OPEN: Ex-BBC stars Emily Maitlis, Jon Sopel and Lewis Goodall returned to the
airwaves with the first episode of their News Agents podcast yesterday, which
focused on the FBI raid on Trump’s Mar-a-Lago mansion. The episode features the
always-mouthy former White House spinner Anthony Scaramucci, plus Trump’s
former chief of staff Mick Mulvaney as the trio of presenters deliver a
refresher on America’s latest drama — listen here.
**A message
from UK Fisheries: The seas off Greenland have long offered plentiful cod and
haddock to the UK’s distant waters fleet – in 2020 we caught almost 1,700
tonnes in Greenlandic waters. After Brexit we were promised as good or better
fishing opportunities as an independent coastal state. However, while
competitor nations – including Russia – continue to catch whitefish in these
waters, the UK fleet now has no quota at all. We have failed to negotiate a
fair deal even though the Greenlandic shellfish industry is heavily dependent
on the UK market for its exports. Greenland has said that it is willing to give
continued UK fishing access in return for a good trade deal, so at a time when
we need to prioritise food security, it’s incredible that the Government does
not instruct its negotiators to strike a fair deal for Britain. Click
here to see what it must do NOW.**