Rishi Sunak will meet King Charles and address the nation from Downing Street as he becomes prime minister tomorrow morning.
Mr Sunak promised to bring “stability” and “unity” to the United Kingdom after being crowned as the new Conservative party leader this afternoon.
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What we already know:
Who is Jeremy Hunt, Britain’s new chancellor of the Exchequer?
His selection for the post appeared intended to restore calm to financial markets.
Jeremy Hunt, who was appointed Britain’s chancellor of the Exchequer on Friday, is a former foreign minister and a pragmatist from the ideological center ground of conservative politics. The selection of a moderate with government experience appeared intended to restore calm to financial markets.
Prime Minister Liz Truss of Britain named him to replace Kwasi Kwarteng, whom she had fired the same day, cutting short his tenure after just 38 days on the job and after he had introduced a tax plan that backfired and rattled financial markets.
The dizzying speed of the turnover in a post that is normally associated with measured, and sometimes staid, authority sent a jolt through British politics, sharpening criticism of Ms. Truss from within her own party.
Speaking at a news conference, Ms. Truss called Mr. Hunt “one of the most experienced and widely respected government ministers and parliamentarians — and he shares my convictions and ambitions for our country.”
Mr. Hunt, who studied philosophy, politics and economics at Oxford University and was head boy at one of Britain’s leading private schools, was among the candidates to lead the party in 2019, finishing second to Boris Johnson, who then became prime minister.
When Mr. Johnson himself resigned in July, Mr. Hunt ran again but was eliminated in the first round of the leadership fight, gaining just 18 votes from conservative colleagues. He went on to endorse Rishi Sunak, Mr. Johnson’s chancellor, for leader. The contest was eventually won by Ms. Truss.
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What we don’t know:
Is Rishi appointing Jeremy Hunt as the next Chancellor?
As we know Rishi himself has servied the UK as the chancellor of the Exchequer before. Would Jeremy be comfortable working with someone who has more experience in the job than he did?
Rishi Sunak was educated at Winchester College, read philosophy, politics and economics (PPE) at Lincoln College, Oxford, and gained an MBA from Stanford University.
As a son of a senior officer in the Royal Navy, Jeremy Hunt was born in Kennington and studied Philosophy, Politics, and Economics at Magdalen College, Oxford, where he was President of the Oxford University Conservative Association. He was first elected to the House of Commons in 2005, and was promoted to the Shadow Cabinet as Shadow Minister for Disabled People and later as Shadow Secretary of State for Culture, Media and Sport. Hunt served in the Coalition Government as Secretary of State for Culture, Olympics, Media and Sport from 2010 to 2012, where he led the drive for local TV, resulting in Ofcom awarding local TV broadcasting licences in respect of several cities and towns. Hunt also oversaw the 2012 London Olympics, which received widespread acclaim. His previous business interests have seen him become one of the UK’s richest politicians.
When the members of the Norwich & District Association of Estate Agents were asked the following questions:
If he stays in post, what difference do you think Jeremy Hunt as new chancellor will make?
“Well, he can’t do worse than his predecessor,” says Ben Marchbank of Bedfords.
Jan Hÿtch of Arnolds Keys says that who is in the chancellor’s chair is less vital than a sensible fiscal policy emerging. “As with the merry-go-round of housing ministers, policy and continuity is far more important than personalities.”
Nicholas Taylor of Hadley Taylor says that Jeremy Hunt will steady the ship, although “it’s very concerning that the markets and the Bank of England now seem to be dictating our economic policy.”
Jan Hÿtch is residential partner at Arnolds Keys – Credit: Arnolds Keys
What does the change in stamp duty mean for buyers? Does it depend on what you’re buying?
“Buyers can expect to save a maximum of £2,500 – which is relatively small in relation to the additional annual mortgage costs that we’ve been experiencing,” says Natalie Howlett-Clarke of Savills.
“As the stamp duty cut is permanent, it is unlikely to bring the same level of urgency to the market as the recent stamp duty holiday.”
Jan Hÿtch adds: “It’s a shame that the opportunity of saving money on stamp duty has come at the same time as an increase in month-to-month mortgage payments for first-time buyers.
“We have not seen a significant upturn in first-time buyer enquiries since the announcement, probably for this reason.”
Nicholas Taylor says that interest rates rising shouldn’t be a surprise – Credit: Getty Images/iStockphoto
Interest rates are rising. What does this mean for the housing market?
“Interest rates have been rising since December, so higher rates shouldn’t be a surprise to anyone,” says Nicholas Taylor.
“Younger people will be spooked by higher rates because they’ve never seen ‘normal’ rates before. Higher rates will halt price inflation and we will see prices drop a little – although premium properties and locations will fare better.”
Ben Marchbank adds: “Before Gordon Brown handed responsibility for monetary policy to the Bank of England, the chancellor set the base rate, and it was commonly used as a lever to control the housing market. Whilst it is no longer the chancellor wielding the lever, the mechanism remains effective, and we expect to see a drop in demand.”
Natalie Howlett-Clarke, of Savills, says that if mortgage rates hit the levels currently being priced in money markets, there could be considerable financial strain on borrowers – Credit: Savills, edp24
Voices: If at first you don’t succeed: What sort of prime minister will Rishi Sunak be?
Mon, 24 October 2022 at 2:17 pm·5-min read
- Rishi SunakBritish politician (born 1980)
- Jeremy HuntBritish Conservative politician
- Liz TrussPrime Minister of the United Kingdom since 2022
- Boris JohnsonPrime Minister of the United Kingdom from 2019 to 2022
If at first you don’t succeed… Rishi Sunak has tried again and is now going to be the UK’s next prime minister. Only seven weeks after Conservative Party members rejected him and inflicted Liz Truss on us, the former chancellor has bounced back much sooner than he ever thought possible.
Indeed, some of Sunak’s allies thought it would never happen. The words of Jeremy Hunt, who twice ran unsuccessfully for the leadership, rang in their ears: “You only get one shot.” Tory grassroots members do not like to admit they got it wrong, but they made a catastrophic mistake in ignoring Sunak’s repeated warnings that Truss’s unfunded tax cuts would spook the financial markets and end in disaster. Truss branded him a “doomster” – but rarely has a politician been proved so right, so soon.
So Sunak will have the daunting task of clearing up the mess he predicted. Thanks to Truss’s failed experiment, the state of the public finances is worse than if Sunak had won this summer’s contest. There is an estimated black hole of £40bn to fill to show that debt is falling in the medium term, meaning tax rises and spending cuts.
Hunt is expected to remain his chancellor. It is not always easy for the chancellor when the prime minister used to be at the Treasury, as Alistair Darling discovered when Gordon Brown was PM. Sunak and Hunt have a similar outlook, though Sunak is bound to want to make a few tweaks to the medium-term fiscal strategy Hunt is due to unveil on 31 October.
They know they cannot afford to fall out when the City is watching them like hawks. There was a positive reaction on the markets today after Boris Johnson withdrew from the Tory race. A Sunak-Hunt double act is a dream team for the markets, but not enough. Crucially, the markets will be looking for evidence they can administer the unpalatable medicine in the fiscal plan and win enough support from Tory MPs to secure Commons approval.