Ministers want to ‘tough out’ labour shortages, but some Tories believe flexibility will be needed
Rishi Sunak became chancellor a month before the country went into COVID lockdown – and became the public face of the furlough scheme, as the government paid millions of people’s wages.
Today, in his first in-person speech to the Tory party conference, days after the scheme wound up, he is trying to do two things.
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The first, to show he has a jobs plan for the recovery. But, also, after a spending splurge that many at this gathering see as not very Conservative, to show that he can somehow deliver on the “levelling up” agenda while getting the public finances on track, and trying not to raise any more taxes.
On jobs, he’s announcing a £500m plan to help people return to work, with extension of the Kickstart scheme for young people – which has been slower than expected to meet its 250,000 target – and support for people on low incomes to retrain and learn new skills.
The Tories are in a chipper mood, ahead in the polls, and confident that more lockdowns are not on the horizon. But the backdrop is not what they would have chosen – with ongoing fuel queues and a looming cost of living squeeze driven by rising gas prices, and the prospect of rising inflation and months-long problems with getting food onto supermarket shelves.
The chancellor knows some sectors are facing acute labour shortages, but he echoed the words of the prime minister yesterday when he told Sky News this is the price of “the transition to a high wage, high skill economy” – or bluntly, that if businesses are short of lorry drivers or butchers, don’t bring them in from abroad, just pay them more.
Nick Allen, of the Meat Processors Association, responded that this has a cost to everyone, that paying higher wages to butchers would mean more expensive products in the shops or relying on more imports. Transitioning away from free movement of people, he said, would take 18 months of government support, not weeks.
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The clear message from ministers going into the conference is that with fewer low-skilled migrants, British workers will in time be paid more. They plan to, in the words of the Business Secretary Kwasi Kwarteng this weekend, take some emergency measures to ease shortages, but essentially “tough it out”.
But some Tories here privately believe the government will need to be more flexible and may need in the coming months to offer more help to industries if the real-world impact on products on the supermarket shelves continues to be disrupted, and to families who will be affected by higher living costs. It’s a dynamic to watch.
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Sir Keir Starmer has said he will be “looking towards a better, brighter future” in his first Christmas message as prime minister.
It comes almost six months into the Labour leader’s time in Downing Street, with the prime minister currently having to battle criticisms of his party’s management of the economy and the direction he is taking the country.
His message takes an optimistic tone, while also encouraging people to “look after those around us” and wishing for peace in the Middle East.
Sir Keir said: “This Christmas, people will be travelling up and down the country. Heading home, visiting relatives and loved ones to celebrate together the hope and joy of this special season.
“It’s a time to remind ourselves what’s really important. Family. Friendship. And fellowship between all people.
“Being there for one another – in these celebrations, as well as the more difficult times.”
Keir and Victoria Starmer hosted a Christmas party for children from four schools across London at Downing Street earlier this month. Pic: PA
The prime minister went on: “I’d like especially to thank those who will spend their Christmas serving others this year. In our NHS and emergency services, our Armed Forces and the churches and charities that will welcome every person this Christmas.
“Because I know that this is not an easy time for everyone, and my thoughts are with all those who are lonely this Christmas. Having a tough time, missing a loved one. You are not alone.
“Because as Christians celebrate the birth of Jesus Christ, the Christmas story reminds all of us to reach out to one another. To care for one another. And to look after those around us.
“This Christmas, I will be hoping for peace, particularly in the Middle East as the birthplace of the Christmas story.
“I’ll be looking towards a better, brighter future for every person and celebrating the joy and wonder that Christmas brings.
“So, from my family to yours, I hope you have a very merry Christmas.”
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Kemi Badenoch, the leader of the Opposition, has also shared a Christmas message.
It strikes a similar tone to Sir Keir’s, although shares more personal anecdotes.
For example, the Tory leader says Christmas is her “very favourite time of year” due to “having lots of family around, seeing my friends, eating, drinking, having fun, making merry”.
She goes on to thank everyone in the country for “supporting each other”, and encouraging people to “support all of those people who need our assistance”.
Ms Badenoch says Christmas is her ‘very favourite time of year. Pic: PA
Sir Ed Davey, the leader of the Liberal Democrats, paid tribute to young carers in his Christmas message.
He looked after his sick mother as he was growing up, and tried to get a Christmas number one with a song raising awareness of young carers.
Ed Davey and Tewkesbury MP Cameron Thomas carrying a Christmas tree this month. Pic: PA
Sir Ed said: “Carers embody the Christmas spirit of love, selflessness and generosity.
“So I hope we can all take some time to think of them, and keep them in our hearts.”
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