When Labour included a plan to raise the rate of corporate tax in their 2019 manifesto, they were met with considerable backlash from the media. Few could have imagined, at the time, that within two years the Conservatives would announce a similar plan — raising the corporate tax rate by only 1% less than what Corbyn had proposed. Of course, much had changed throughout the course of the intervening year, namely the Covid-19 pandemic. When, in March of 2020, a lockdown had become completely unavoidable, the Tories were forced to commit to the very thing which they define themselves in opposition to — unprecedented levels of public spending. Indeed, when announcing the furlough scheme, ‘unprecedented’ was the very word Rishi Sunak used as he spoke proudly of the support the government were providing.
The announcement did not echo the hard-line adherence to austerity measures which had defined Tory policy for ten years. In fact, in the government’s pursuit of popularity, the pandemic appears to have placed the party’s dogmatic approach to fiscal conservatism on ice. In another move which suggests that the apparently radical policies of Corbyn’s Labour have been closely studied by the government, it was recently announced that train services will be brought under public control. The budget, which took place in March, also contained the provision of restart grants for businesses which have been affected by the lockdowns. Even the decision to raise nurses pay by one percent, as woefully inadequate as it appears to be, does not fit strictly within the ethos of 2010s Tory policy. Full austerity is, for the time being at least, on hold.
The extent to which the mood has changed amongst many in the Tory camp can be seen in the attempted rebellion against cuts to foreign aid. Around 30 Conservative MPs attempted to overturn the cuts, which would leave 100,000 without water in Cox’s Bazar, the world’s largest refugee camp. While the cuts show that the party remain, at their core, deeply fiscally conservative, it is nonetheless telling that this is where they have chosen to cut spending. About two thirds of Britons, according to polling, support reducing foreign aid, with particular popularity for the motion in key swing seats. Evidently, even an act as apparently callous as this is steeped in populism.
Therein lies the tricky task for Johnson & co once the pandemic eventually ends, for as much as they abhor public spending, returning to the days of hard-line austerity is at odds with their modern populist form. As talk of ‘levelling up’ in Northern towns — as vague and meaningless as it may prove to be — stands them apart from Labour in many key constituencies, cuts to public services would shatter these promises, and with them, people’s faith in the party.
It is in this sense that the Tories are at odds with themselves. For all their newfound acceptance that public spending is necessary, the undercurrent of dogmatically pro-austerity conservatism remains prominent within the party. The free school meals fiasco is the prime example of this political schizophrenia. The government chose, on two occasions, to fight for an incredibly unpopular issue in the public arena. Their attitude to education in general shows this resistance to change in its clearest form. In a move which prompted the resignation of education adviser Kevan Collins, Johnson recently offered 1.4 billion in education funding, one tenth of the recommended amount. This sector is, apparently, one which will not reap the rewards of a populist economic approach.
It is therefore clear that the Conservatives have not experienced a sudden, collective growth of conscience. The easing of austerity is merely an inevitable by-product of an unprecedented year and a half. Nonetheless, for a party as obsessed with popularity as this one, undoing some of these changes could well be political suicide. If a genuine desire to revitalise the economy is Johnson and Sunak’s priority when the Covid-19 recovery takes place, then austerity is in fact an obstacle to that. The very notion that rolling back the state-funded parameters of the free market is somehow conducive to a healthy economy is a fallacy that may not survive the pandemic.
The reality is, however, that Boris Johnson is a remarkably indecisive man. This, along with the lack of any pressure from the left, make the future of government policy an entirely unpredictable topic. The Tories remain, for the time being, a party going in two completely different directions at once. As one half lurches towards populist economics, the other is as committed to the dogma of austerity as ever.
Words by Cian Carrick
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