Chancellor Rishi Sunak at work in the Treasury. Image HMT Flickr.
“This is not a time for ideology and orthodoxy, this is a time to be bold, a time for courage,” Chancellor Rishi Sunak told millions of television viewers in his first coronavirus press conference in mid-March. “I want to reassure every British citizen, this government will give you all the tools you need to get through this. We will support jobs, we will support incomes, we will support businesses, and we will help you protect your loved ones. We will do whatever it takes.”
That pivotal speech, post-budget Sunak’s first big outing of the coronavirus crisis, struck a chord with many voters. Not just because he was offering over £300 billion in government support, but also because of the way it was delivered. The Chancellor looked straight into the lens and spoke with empathy and compassion, two characteristics the public does not always associate with the upper echelons of the Conservative party.
The chancellor’s poll ratings skyrocketed. His favourability rose from eight percent at the beginning of March to 47% by the end of the month, dwarfing Boris Johnson’s 20%. More than three months later, he continues to fly high above his boss, with a July 5 Deltapoll survey showing that a net positive of 41% of the public believes he is dealing with the crisis well, compared to net positive of two percent for Boris Johnson.
Sunak makes his “mini-budget” statement on Wednesday, mapping out measures to boost the economy, starting from an exceptionally strong position.
In part this is because the”whatever it takes” speech from March remains in the public mind, as former Downing Street pollster James Johnson found in a recent focus group. “It’s very rare to hear people talk about a politician in values terms like that – he’s looking after the people – that’s really quite rare. It just shows the impact that that speech had back in March, a couple of people referred to that,” he told Times Radio.
Many Conservative MPs now see Sunak as the leading contender to succeed Boris Johnson as prime minister, perhaps sooner than later. The Chancellor himself is regarded as angling for the job. One senior Tory backbencher told Reaction: “He’s very assiduous about keeping up with MPs. He sends texts around and does the rounds. You’d assume all politicians do that, but it’s actually rare. You have to be very ambitious.”
He remains a mystery to many in his own parliamentary party, however. The speed with which Sunak rose to become Second Lord of the Treasury, just five years after becoming an MP, has left politicians and journalists playing catch up.
Who is this new political creature? And if Boris falls or is removed, will Sunak step up?
Sunak is a politician who wants you to know that he came from humble beginnings. “I grew up watching my parents serve our local community with dedication,” he says on his website. “My dad was an NHS family GP and my mum ran her own local chemist shop.” These are not the professional roles one would generally associate with the parents of a Winchester College student.
Indeed, Sunak’s path to admission to one of the country’s top schools was not financially straightforward. He tried and failed to win a full scholarship, and ultimately his parents had to work extra hours to cobble together the fees. Sunak highlights this as a sign of their commitment to education: “Their general view was that they were going to work really hard to provide a better life for their kids. Education is everything. That’s an ingrained value in my family. That’s how you provide a better life,” he told Nick Robinson.
It was at Winchester that Sunak first expressed his political conservatism. Aged just seventeen, he penned an article for The Wykehamist lamenting Tony Blair’s first landslide victory. “He revels in the label of a patriot, but has plans for the possible breakup of the United Kingdom and membership of an eventual European Superstate,” the future chancellor wrote.
Like three Wykehamist chancellors before him, Sunak went on to study at Oxford University. His course – Politics, Philosophy and Economics (PPE) – has been regarded for a long time as a route to political power, a path that had recently been trod by David Cameron and William Hague. Although he never joined the university’s Conservative Association, Sunak was an active member of the Investment Society. The politics stopped, replaced by an urge to make money.
“I was really keen on trying to get a good job after I left, and the way to do that was to do all these things, and to get an internship. That was my focus,” Sunak told Robinson. If that was indeed his goal, he achieved it in abundance, joining the prestigious investment bank Goldman Sachs as soon as he graduated.
In a boom era for the City, this was a direct line to financial mastery, but Sunak didn’t stay long at the firm. In 2004, three years into the stint, he left to return to education, this time as a Fulbright scholar at Stanford University, where he studied for an MBA at Stanford Business School. He would soon fall in love with a fellow student, Akshata Murthy, the daughter of Indian IT billionaire, Narayana Murthy.
The couple married four years later, in 2009, with their wedding widely reported in the Indian press. Known for his humility, Naranya Murthy opted for a “simple ceremony.” His wife, Sudha Murthy, was reported as having rejected the offer by the caterers to serve guests on silver plates. For Sunak, this was a glittering moment. The son of a pharmacist had joined a billionaire family.
Sunak was already in the process of amassing personal wealth. In 2006, upon his return to the City after Stanford, he joined The Children’s Investment Fund (TCI), a hedge fund founded by billionaire Chris Hohne. The future chancellor quickly rose up the ranks and within two years became a partner at the Berkeley Square firm. It was an unusually rapid rise for a fresh faced graduate from business school. Contemporaries say he displayed a grip and determination that his future political colleagues would subsequently witness.
The secret, according to Sunak’s TCI contemporaries, was his affability. “There are two kinds of people at hedge funds. Handsome and thin smooth-talkers who are always on the phone or going out to lunch with clients, getting them to part with their money. And then quants in the back room with their shirts buttoned up badly,” one source told the journalist Ben Judah. Sunak excelled at being a smooth-talker.
But if he intends to reach the apex of British politics, the chancellor will have difficult questions to answer about his time at TCI. The firm has long been, in City terms, innovative and aggressive. The firm played a leading role in the ABN Amro disaster, leading calls for the Dutch bank to to be sold or broken up. RBS, the Royal Bank of Scotland, led the consortium that bought ABN Amro. It doubled the size of RBS, which then needed a £45 billion bailout from the taxpayer. Sunak denies any involvement in TCI’s ABN Amro strategy.
When Sunak left TCI in 2009, he joined the breakaway hedge fund Theleme Partners. This firm would soon also be mired in scandal, when it was revealed that firm’s founder and Sunak former associate, Patrick Degorce, had participated in a multimillion pound tax avoidance scheme, and was ordered to pay £8 million in compensation to the exchequer. Again, Sunak sought a different job in the City, ultimately landing in the arms of his billionaire father-in-law, who made him a director at his private family investment vehicle, Catamaran Investment.
His spell in the City hasn’t escaped the notice or envy of his parliamentary peers. “I’m always suspicious of bankers who become politicians”, says a senior Tory backbencher.
By 2015 he had shown sufficient drive to impress David Cameron’s CCHQ. Shortly before the election that year, as Hague announced his intention to step down, Sunak became a leading symbol of Cameron’s attempts to diversify the Conservative parliamentary party. With the full support of Hague, Sunak was parachuted into Richmond, Yorkshire.
The process was far from smooth, however, and Sunak faced intense pushback from the constituents, as captured in an on-the-ground Politico report. “The safe seat I think has had it. They put a young man here, Rishi… and up here, they put the wrong man up here. He’s a nice enough chap. They say colour don’t matter nowadays, but I think it does,” said one constituent. “Just tell him ya don’t like curry,” heckled another. It was racist abuse.
Sunak made light of the situation in his maiden speech in the Commons. “Wandering through an auction market, I was introduced to a farmer as the new William Hague. He looked, quizzically, and then said, ‘Ah yes, Haguey, good bloke, like him. Bit pale though, this one’s got a better tan.’” There were laughs in the chamber, but the underlying sentiment was disturbing.
Sunak understood this well. Having analysed ethnic minority communities for the think tank Policy Exchange, he was no stranger to racial dynamics in British society. In an article on the need for political parties to treat ethnic minorities as adults, he wrote: “Perhaps fittingly, one of the few common traits amongst minorities is their shared sense of ‘British-ness’. Almost all ethnic minorities have a much stronger commitment to the notion of ‘British-ness’ than their white peers and feel it is an important part of their identity. In contrast, the white population prefers to identify itself with the individual home countries and ‘being British’ appears to be much less important to them.”
Later in his maiden speech, Sunak made a point of praising his predecessor’s Euroscepticism. “We should remember that, as leader, William Hague campaigned to stop Britain joining the single European currency, and instead to keep the pound. His judgment looks even more excellent today than it did then.” The freshman MP may well have remembered the article he wrote as a seventeen-year-old Wykehamist condemning the Europhilism of Hague’s opponent.
Euroscepticism is one of the few ideological lines stretching through Sunak’s adult life, and soon it would become defining in his parliamentary career. When, prior to the Brexit referendum campaign, David Cameron called Sunak into No10 to ask for his support, he refused to attend. According to Tim Shipman, Sunak stood firm in the face of intense pressure from Downing Street, despite having been an MP for mere months. His future rival, Sajid Javid, did bend.
The years immediately after the referendum were relatively slow for Sunak. In 2016 he supported Michael Gove’s doomed leadership bid. In January 2018, Theresa May made him a junior minister in the department of Housing, Communities and Local Government, under Sajid Javid’s leadership. But his big break would come in the leadership election of 2019.
Boris Johnson was always the Conservative party membership’s most favoured candidate to succeed May, yet there remained for him what was once considered an insurmountable hurdle – the Conservative parliamentary party. Johnson had to convince a sceptical parliamentary party that he was the future, not a busted flush, and nothing supported this effort more than an open letter from Rishi Sunak, Robert Jenrick, and Oliver Dowden in The Times.
“The three of us represent different parts of the country, voted Leave and Remain, and have different backgrounds. But we all believe the dangers that face our nation and our party are too grave and too imminent to take a chance,” the letter said. “We need to ask ourselves who can not only confront but defeat these twin threats. And if that’s the question, we believe there really is only one logical answer: Boris Johnson.”
The three junior politicos were indeed from different parts of the party, but each was a fresh face tipped for senior government roles. Their endorsement showed that the next generation of the party was ready to embrace Johnson, and it was seen by the prime minister’s allies as a pivotal part of his leadership campaign. Immediately upon becoming prime minister, Johnson shuffled all three men into senior government roles, with Sunak appointed Chief Secretary to the Treasury, one step down from the chancellor.
Again, however, Sunak wound up being Sajid Javid’s junior. The relationship between these two men was positive though. They had shared similar experiences of racism, and even watched the new Star Wars movie together.
The friendship was tested when Javid resigned as Chancellor after Number 10 moved to fire his team of special advisers. When he filled the role, sources close to Javid briefed that he would become a puppet of Cummings and Johnson, because he had accepted the plan that Number 10 and Number 11 would have one joint team of economic advisers. The former chancellor has continued to make a series of media interventions, including publishing the details of his planned budget just days before Sunak delivered his first.
The joint special adviser unit, imposed by Number 10 as a condition of his appointment, did enable direct political control from Cummings and Johnson. A source close to Sunak acknowledges “there was a disparity in power when he first came in”. His popularity has helped him fix that imbalance, a friend claims.
Cummings and Johnson wouldn’t have expected their newly-appointed Chancellor to rise so quickly in the public’s opinion. He had only a matter of days to prepare his first budget, in the shadow of the then looming Coronavirus crisis. Days after that he had to craft the “whatever it takes” speech delivered direct to the nation.
Sunak has a central advantage: he works hard – very hard – say colleagues. He devours detail and works his way in an impressive fashion through the papers and submissions in ministerial boxes. This, say colleagues, makes for a contrast with the current Prime Minister.
Sunak has risen fast, proving that his skills people skills and work ethic are transferable to politics. Now, having almost reached the apex, he has one more colleague to replace: Boris Johnson.
Sunak is building a team. For all the talk a few months ago of him being a puppet, the Chancellor is steadily constructing a brand separate from Number 10. Cass Horowitz, a communications wizard, has been credited for the Chancellor’s social media presence. He posts specialised graphics every time a positive announcement is made. Gone are the bland colours of HM Treasury or the black and white of 10 Downing Street. In come pink lettering, and bright pictures of Sunak looking prime ministerial with perfect hair and just the right tie placement.
His picture-perfect appearance has been credited to Allegra Stratton, the former ITV national editor, who is now his communications director. Stratton is married to Spectator political editor James Forsyth. Sunak served as best man to Forsyth, the political editor of The Spectator and fellow Wykehamist, at their 2011 wedding. He is said to have delivered a “touching” best man’s speech.
It is difficult not to see Sunak’s astute team-building as preparation for a future leadership bid. As a source close to the Chancellor said: “Of course he looks at his popularity and regards that as a political asset. It wouldn’t be human not to look at that and consider.”
The opportunity may come sooner than later. Boris Johnson’s lacklustre handling of the coronavirus epidemic and declining popularity is making some Conservative backbenchers think twice about his ability to lead the party into the next election, and Sunak’s popularity provides a legitimate back-up option.
One senior backbencher says: “There is a rebellion bubbling on the backbenches. Basically we had a two to four week lag from Europe and he [Johnson] did nothing … The newly elected MPs think they owe their victory to Boris, but the truth is that was an anti-Corbyn vote.”
If Johnson’s support in the parliamentary party does slide, then the new MPs will be a valuable asset, and perhaps even the kingmakers, in a leadership election. Here, again, Sunak seems well placed as a different kind of Tory who can appeal beyond traditional Conservative voters.
Sunak’s supporters also speak highly of Liam Booth-Smith, a former local government think-tanker turned head of the joint economic unit between Number 10 and Number 11, drafted in by Cummings but close to Sunak. His experience working on re-energising small towns will feed into the Chancellor’s offer to left-behind constituencies in the short term, and shore up his credibility amongst the new crop of MPs in the medium term.
Sunak may also stand a better chance of boosting Conservative fortunes in Scotland, where Boris Johnson is deeply unpopular, even more so since the Covid-19 crisis. Scotland and the Union will be a central story in this parliament. Next year is the Holyrood election and if the SNP wins an overall majority, First Minister Nicola Sturgeon will demand a second independence referendum. The Nationalists regard Johnson as their ideal opponent in such a contest. Sunak, more difficult to caricature, could be a much trickier proposition.
But his elevation to the premiership will not be straightforward. Tory leadership front-runners often don’t make it. Will his popularity endure through high unemployment? And there will soon come a point when Sunak has to play bad cop to Johnson’s upbeat good cop to save the country’s finances. The slow rate of recovery due to continued social distancing will create large shortfalls for years to come. To pay for this the Chancellor will either have to increase taxes and/or cut spending at some point. He is, after all, described as a fiscal conservative.
“I’m sure he’s worried about his public popularity being too high,” one source close to the Chancellor said. “He’s sitting on a popularity powder keg.”
Sunak’s competition for the top job, including his former boss Sajid Javid and former Health Secretary Jeremy Hunt, will be waiting to see if it explodes.
For now, Sunak is the darling of the Tory party and popular with the voters. He is a ready-made replacement for the Prime Minister if Boris implodes.