How is Sunak doing on halving inflation, cutting NHS lists and stopping boats?
In January, Rishi Sunak unveiled the vision for his government. Five pledges; five clear goals; five ambitions for his ministers.
His aim was clear: be seen as an effective, solutions-focused administration and, hopefully, reap the electoral rewards.
“No tricks, no ambiguity; we’re either delivering for you or we’re not,” he vowed.
Eight months in, and Sunak appears deep in the weeds. This week, YouGov found 60 per cent of UK adults – and 53 per cent of Leavers – think he’s doing badly.
With a widely anticipated reshuffle and October’s party conference fast approaching, ahead of a likely autumn 2024 general election, No10 will be hoping to turn things around by Christmas.
But how well is the programme really going?
Morning Wire takes you through Sunak’s scorecard.
Halving inflation
Rating: AMBER
UK inflation fell to 6.8 per cent in the year to July, a decrease from 7.9 per cent in June, according to figures from the Office for National Statistics.
When the PM promised to halve it in January, inflation had been 10.7 per cent in the three months from October to December 2022 – making his target 5.3 per cent by the end of 2023.
While that is now looking increasingly achievable, experts agree it’s still far from guaranteed.
The reality is UK inflation is still very high compared to similar economies globally, and still well over triple the Bank of England’s target rate of two per cent.
Today’s drop was driven by the energy price cap fall and slower food cost rises, but core inflation – which strips out volatile food and energy prices – did not budge from June’s 6.9 per cent.
Heidi Karjalainen, research economist at the Institute for Fiscal Studies (IFS) warned “the stubbornly high rate of price inflation for goods and services other than food and energy has put the target in jeopardy.
“With only four months to go, it no longer seems at all clear that inflation at the end of the year will have fallen by enough to achieve it.”
And Russ Mould, investment director at AJ Bell, agrees.
“[Core inflation] suggests a lot of the decline in the headline rate stems from lower oil, gas and energy prices,” he said.
“The bad news is Brent crude is going back up again, so this could put upward pressure on headline readings in the second half, and wage growth could yet add fuel to the fire as well.
“It is not certain that inflation will meet the prime minister’s target.”
Growing the economy
Rating: AMBER
It’s no surprise the Stanford grad and former Goldman Sachs man’s second (and third) pledges are also focused on UK plc’s bank balance.
But in terms of economic growth it’s a similar tale: if not one of woe, then far from joyous.
IFS deputy director Carl Emmerson describes the latest figures as “not anything worth shouting about”. GDP in the second quarter of 2023 was 0.4 per cent higher than the same quarter last year.
We’ve dodged a recession, yes, no but productivity is stagnant, and forecasts remain drab. Economists speak of the four big shocks: the financial crisis, Brexit, Covid and the cost of living crisis.
Mould is similarly measured, dubbing the last five quarter-on-quarter GDP growth numbers [+0.1%, -0.1%, +0.1%, +0.1%, +0.2%] as “not very exciting stuff”.
While “strong wage growth provides further support” and higher returns on cash for savers, plus a boost from the US’ performance, he concludes “the economy is not showing much by way of growth but it is showing more resilience than many expected”.
Sunak still has some way to go then.
Reducing debt
Rating: RED
This is a simple one to judge – debt has gone up. Downing Street may insist that Sunak never pledged it would fall this year, as Emmerson notes.
“Debt was only forecast to fall as a share of national income in 2027-28,” he said. “It has continued to rise, but presumably the PM did not intend to commit to debt falling this year.”
However, aggregate government debt is growing, Mould highlights, now £2.6 trillion “and rising… equivalent to around 100 per cent of GDP” even if annual borrowing falls, helped, he predicts, by a VAT spending boost, wage growth and aforementioned economic resilience.
In simple terms, he says, ministers borrowed £132bn in the fiscal year to April 2023, and the PM pledged to get that number down – by an unspecified amount – by April 2024.
But between “April and June this year new borrowing came to £54bn compared to £42bn in the equivalent period in 2022 – that is not a good start,” Mould said.
He added: “The last 15 years of unorthodox monetary policy – zero interest rates and quantitative easing – and the fiscal splurge and Covid support are coming home to roost.
“That may have felt like free money at the time, but there is no such thing and we must now foot the bill, either in the form of higher taxes, higher interest rates or higher inflation.”
Cutting NHS waiting lists
Rating: RED
This rating is also easily decided, as the PM himself publicly acknowledged yesterday.
Speaking at a hospital visit in Milton Keynes, he admitted progress on his fourth pledge had ground to a halt, despite insisting an initial drop in long-term waits had taken place.
“We’ve practically eliminated the number of people waiting two years. Earlier this year we practically eliminated the number of people waiting one and a half years,” he told media.
“Unfortunately, the progress we were making has stalled because of the industrial action.”
According to House of Commons Library research, the hospital treatment waiting list rose to a record of nearly 7.5m in May 2023 while the 18-week target has not been met since 2016.
And just last week that figure rose again, to a new 7.6m record, in June 2023, with 40 per cent of patients waiting more than 18 weeks, or over four months, to be seen.
Stopping the boats
Rating: RED
Arguably, progress on this pledge is a somewhat more nuanced picture.
The government has introduced new policies aimed at achieving this aim, but both the Rwanda deportation scheme and the Bibby Stockholm migrant barge have been beset by delays, controversy, and, now, Legionella bacteria.
Sunak and home secretary Suella Braverman’s hopes are pinned on another High Court appeal and, presumably, a thorough deep clean and successful health and safety inspection.
In the meantime though, 1,719 people made their way across the Channel in 32 small boats in the last seven days, and six asylum seekers drowned after their vessel sank on Saturday.
And with No10 repeatedly appearing to insist that stop the boats means stop ‘all’ the boats, there’s only really one colour choice for this pledge.