When Lord Frost, who recently resigned as Brexit minister, called yesterday for Boris Johnson to rediscover his enthusiasm for ‘free markets, free debate and low taxes’, he spoke for Tories up and down the land.
For some time now there’s been growing concern in Conservative ranks about the Prime Minister’s penchant for big government and high taxes.
Time, said Lord Frost, to reset the ‘direction of travel’.
The problem for the Tory faithful is that the Government still seems determined to head helter-skelter in the wrong direction.
From this April people will be paying billions of pounds more in national insurance contributions and income tax as a five-year freeze on tax allowances announced by the Chancellor Rishi Sunak in October means an additional 1.5million low earners are expected to be captured by the basic rate of income tax and 1.2million people dragged into the higher rate.
All this at a time when their cost of living is already being squeezed by inflation and rising fuel bills.
Businesses too will soon be paying a lot more tax on their profits, which will leave them less to invest.
And government will become ever more intrusive as it mandates everything from what sort of cars we drive to how we heat our homes and even cook our food – all in pursuit of its self-imposed aim of reaching net zero CO2 emissions by 2050.
So Lord Frost’s rallying cry comes at a salutary time for the Government. It also piles pressure on Johnson to change course when he’s already losing his grip on the Tory party in Parliament and the country.
It’s easy to forget that only last autumn Johnson was still riding high in the polls, even though the grip of the pandemic was proving to be depressingly tenacious and the economy was starting to stutter.
Then came a series of entirely unforced, self-inflicted errors.
Last November there was the botched attempt to save the skin of former minister Owen Paterson after he had been found guilty of ‘serious breaches’ of lobbying rules, a move that looked like Tory cronyism at its worst.
Then a series of revelations depicting 10 Downing Street as wine-and-cheese party central, while the rest of us were observing lockdown, reinforced the feeling that it was one rule for us, another for Johnson and the circle around him.
Meanwhile, the seemingly endless saga of Downing Street’s ‘Wallpaper-gate’ reminds us that honesty and the Prime Minister are often strangers.
None of these episodes on their own matters very much. But taken together they revived what has always been the biggest fear about Johnson, even among Tories: that he can’t be trusted – that he is cavalier with rules and the truth whenever it suits him.
As a result, by last month the Tory advantage in the polls had vanished, to be replaced by a consistent Labour lead – which is a substantial 16 points in the 57 Tory gains in Labour’s Red Wall, the northern seats that gave Johnson his 2019 landslide victory. His own personal ratings are in the dirt.
The significance of all this is that, just as much more important matters start to crowd in on the Prime Minister, he is far from being well-placed to deal with them from a position of strength.
Lord Frost advocates an approach that would be far more congenial to most Tories. But it is easier said than done.
Take April’s rise in national insurance. It is designed to fund extra money for the NHS and social care. But it was announced when the Chancellor had no idea the cost of living was going to be squeezed so hard this spring – and that his tax rises would only make that squeeze all the more painful for folks on average and below-average incomes.
By Lord Frost’s lights it would now make sense to scrap or at least postpone these tax rises. But, if that was done, where would the extra cash for the NHS come from?
The Conservatives, after all, have no plans to make the NHS run more efficiently on the cash it has. It would mean borrowing even more than the £100billion-plus the Government is already planning to borrow this year, which Sunak has set his face against – and more borrowing is hardly very Tory anyway.
That’s the problem with Big Government. In the end it always requires Big Taxes.
What about all the green taxes, which Lord Frost is rightly sniffy about? They add around £170 to the average household energy bill. At a time when these bills are set to soar from, on average, less than £1,300 a year to around £2,000, it would clearly make sense to ditch the green levies.
But after his grandstanding at Cop26, the Glasgow climate-change jamboree last November, can Johnson really afford to do that? Would his very eco-conscious wife let him?
Again, the Government could cut the 5 per cent VAT on heating, which will soon represent about £100 on the average bill. But how would you make up the lost revenue, except by borrowing more or raising other taxes?
Even the revenue lost from scrapping green levies would probably have to be made up from general taxation, since they subsidise lucrative contracts for providers of renewable energy – contracts that cannot easily be unwound.
The tentacles of the Big State are not easily cut, as Margaret Thatcher discovered four decades ago. Surprisingly, perhaps, much of the responsibility for the expansion of the role of government can be laid at the door of this current generation of Tory politicians.
A bewildering array of green taxes and regulations has been introduced or extended under Tory governments of the last decade – a climate-change levy, a carbon floor price, renewable obligations, carbon-reduction commitments, an emissions trading scheme, the list goes on.
Together they will generate almost £17billion in revenue for the Government in the financial year before the next general election, a rise of over £5billion since the 2019 landslide.
They all add to the energy costs of households and business, some of which have moved abroad or simply shuttered as a result.
But it will be one huge struggle to unpick them, especially since there’s a massive cross-party consensus in favour of them in Westminster.
At least on the Tory side, that consensus is beginning to crack, as Lord Frost’s intervention illustrates. There is growing concern about the unquantifiable but clearly massive cost of net zero on the Tory backbenches.
Some senior Cabinet ministers, such as Jacob Rees-Mogg and Liz Truss, now wonder aloud about the wisdom of April’s tax rises. Red Wall Tory MPs fret about the impact of the cost-of-living squeeze on their constituents, who by and large are not affluent.
The difficulties of the Tories weaning themselves off Big Taxes and the Big State should not be underestimated. But it is clear that the days of Johnson getting it all his own way are over. He will have to bow to the new rebellious mood in his party.
In one major way he already has. Johnson’s decision not to return to lockdown in the face of the surge of the Omicron Covid variant looks like being vindicated. But even if he’d been minded to follow in the footsteps of Scotland and Wales, with their more severe restrictions, I doubt his Cabinet or his backbenchers would have let him.
Lord Frost insists he doesn’t want to see a change of prime minister – just a change of strategy and a new team around Johnson in Downing Street.
Rebels always say that at this stage of the rebellion. But implicit in his critique is that if Johnson doesn’t change personnel and policies then he will have to go.
It is a shot across the Prime Minister’s bow at a time when he is in no shape to repel unwelcome invaders.
We will learn in the next few months if he takes the warning seriously – or shrugs it off in the manner he’s often been inclined to treat unpalatable advice in the past. But if he doesn’t heed Lord Frost’s words, his days as Prime Minister are likely to be numbered.
Source: Thanks msn.com