Call it the Rishi Sunak reset week or, to borrow from The Spectator’s Katy Balls, the shore-up Sunak week – the prime minister will be going into this weekend feeling the past few days have been a job well done.
He has got his flagship Rwanda bill through parliament and is promising a “regular rhythm” of flights will be getting off the ground from July.
He has also got off the ground himself, with a dash to Poland and then Germany, in a show of strength with European allies in the face of Russian aggression.
That would amount to £87bn a year by the start of the 2030s, with the UK spending a cumulative extra £75bn on the military over the next six years.
That of course all hinges on winning an election, which I’ll come to soon, but it is a commitment that throws a challenge to Labour and will delight those in his party who have been calling for increased defence spending for months in the face of growing global threats from Russia, China and Iran.
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In Electoral Dysfunction this week, we discuss whether Rishi Sunak, having been battered for much of his premiership, is finally having a week on top?
There is after all a longstanding tradition in this country that when the chips are down, you jump on a plane to try to go somewhere where you’re more appreciated.
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And Ruth agrees this week that this has been “one of the better weeks that he’s had in his premiership” and is fully behind his defence spending pledge, while Jess points out that Labour is committed to the “exact same plan for upping defence spending”.
The difference between the two parties is that Rishi Sunak set out in some detail how he plans to get to that point over the course of the next parliament, while Sir Keir Starmer has said only he wants to get to 2.5% “when resources allow”.
And that matters because, as it stands, it’s very likely that it will be Sir Keir who is having to decide whether to increase defence spending levels in the next parliament rather than the incumbent.
Cue an election debate on which leader really cares more about defence and, if Sir Keir really does want go toe-to-toe with Mr Sunak on the 2.5%, how does he pay for it?
That will be a discussion for many other days (Labour’s line on this is that the party will hit the 2.5% “when circumstances allow” rather than setting a firm date) as we head into the general election.
But I had to ask Ruth and Jess, why was he on a publicity blitz announcing it now? Was it something to do with the rather large matter of the local elections?
‘Sunak needs to look big’
At this, both furiously shook their heads and looked at me with a touch of derision. “When it comes to the local elections, I want my bins done, I want my schools to be good, and I want my potholes done. That’s what I care about,” says Ruth.
“The people in Birmingham Yardley speak of nothing else but the 2.5% defence spending,” jokes Jess.
“I see why [he’s doing it this week] but actually I don’t think he’s doing for just another example of doing it this week. He needs to look big in front of his party.”
And there are a couple of things to explore in that.
First, the party management issue of a PM very likely to get completely battered in the local elections throwing his party some red meat ahead of that slaughter to perhaps try to protect himself.
Because the local elections could be bad, very very bad. And that throws up questions about Rishi Sunak’s future and also the date of the next general election.
There is a reason why the prime minister will not be drawn on the timing of the election beyond the “second half of the year”.
While it’s true he doesn’t want to have to “indulge in a guessing game”, as one of his allies put it to me, it’s also true that he can’t rule out a summer election given the unpredictability of next week’s local elections and what could follow.
The Armageddon scenario of losing 500-plus seats, alongside the West Midlands and Teeside mayors, could propel his party into fever pitch panic and possibly trigger a vote of confidence in Rishi Sunak.
Does he then decide to call a general election instead of allowing his party to try to force him out?
For what it’s worth, he did not appear, in any way to me, as a prime minister on that plane over to Berlin from Warsaw, who wanted to give up the job. He seemed, for the first time in a long time, a man enjoying it and getting on with the stuff he wants to get done.
There is also the small matter of being 20 points behind in the polls. I suspect his instinct is very much to hold on in the hope that things begin to turn in his favour.
Because, despite what the critics say, he does seem a man who genuinely believes his Rwanda plan, welfare reforms, defence spending and economic management are all stepping stones on his path to perhaps winning back some support in the country.
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“June [or July] is just party management,” says one former cabinet minister. “They are not ready for it and the polling doesn’t work obviously.”
Jess sees the flurry as a “his last ditch attempt” of another reset, and says “the Labour party is not worrying” as the PM tries to pin them on Rwanda or defence spending: “Whatever he goes on is absolutely pilloried within seconds,” she says.
But Ruth argues the defence spending was “actually authentic and a real thing”, and says of the expectations for the local elections that “it’s not just going to be a rout, but an apocalypse, that actually at this point in the cycle it works quite well for Sunak in terms of keeping his job at the back end”.
Observing his various grip and grins this week as I trailed after him meeting the Polish PM, the German chancellor and the NATO secretary general, he is a man that really does want to hold on to that job.
The local elections then are probably going to come as a horrible reality check in just a week’s time as this prime minister, riding high from his European tours, is reminded that his time in office looks like it will be coming to an end – and perhaps even sooner than he might have initially planned.
Sir Keir Starmer has said the Treasury will be “ruthless” in cutting government spending as market turbulence continues.
Responding to a question about the economic situation from Sky News’ political editor Beth Rigby, he said: “The number one mission of this government is economic growth.
“And that was run through the budget, but there’s much more that we’re doing on economic growth, pulling those levers of change.”
Both long-term 30-year and the benchmark 10-year government borrowing costs were up on Monday morning, with the 30-year effective interest rate (the gilt yield) reaching a new high of 5.47% – a rate not seen since mid-1998.
The 10-year borrowing cost reached 4.86%, below the 2008 high recorded last Thursday but at the same levels last seen around the global financial crash.
That pushes up costs for the government, with the chancellor put in a position where she could have to break her self-imposed fiscal rules by failing to bring debt down and balance the budget.
More on Rachel Reeves
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Sterling, which can reflect investors’ confidence in the UK and overall economic health, was also down to a low not seen since October 2023, with £1 buying $1.21.
The dismal economic outlook has prompted warnings mortgage rates could rise in the coming weeks as lenders respond to the turmoil.
In what could be seen as further misery for the British people, the prime minister refused to rule out government spending cuts as he said the Treasury was right to be “ruthless” in cutting spending.
A spending review, due later this year, is expected to require government departments to make efficiency savings worth 5% of their budgets.
Sir Keir told a news conference: “We will be ruthless, as we have been ruthless in the decisions that we’ve taken so far.
“We’ve got clear fiscal rules, and we’re going to keep to those fiscal rules.”
He said the government had “inherited a real mess” of an economy from the Conservative government.
But, he said the government is “going to stick to the fiscal rules”.
“That is a very important thing,” he said.
“We’re determined to bring about that economic stability. And that’s why the fiscal rules are absolutely, absolutely central to what we do.”
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1:57
Why is the UK economy in big trouble?
Sir Keir also twice avoided answering whether Rachel Reeves will still be chancellor by the next election in 2029 in the wake of the dismal economic outlook.
“Rachel Reeves is doing a fantastic job,” he said, but would not say if she would remain in post.
“She has my full confidence, she has the full confidence of the entire party.
“She took the tough decisions.”
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1:14
Chancellor’s ‘pragmatic’ approach to China
The Conservatives jumped on Sir Keir failing to confirm if Ms Reeves would still be in the job at the end of this parliament.
Leader Kemi Badenoch said: “The prime minister just refused to back his chancellor staying in her job.
“Keir Starmer and Rachel Reeves have driven Britain’s economy into the ground. The markets are in turmoil and business confidence has crashed, yet the chancellor is nowhere to be seen.
“Labour promised stability and instead the City minister is mired in corruption investigations and the chancellor is hanging on by her fingernails.”
Scotland’s former first minister Nicola Sturgeon has announced she has split from her husband, Peter Murrell.
Ms Sturgeon and Ms Murrell met via the SNP and first became a couple in 2003. They later married in July 2010 at Oran Mor in Glasgow.
In a statement posted to Instagram stories, she wrote: “With a heavy heart I am confirming that Peter and I have decided to end our marriage.
“To all intents and purposes we have been separated for some time now and feel it is time to bring others up to speed with where we are.
“It goes without saying that we still care deeply for each other, and always will.
“We will be making no further comment.”
Ms Sturgeon unexpectedly announced she was stepping down as Scotland’s first minister and SNP leader in February 2023 after succeeding Alex Salmond following the independence referendum in 2014.
Mr Murrell, who had been SNP chief executive since 2001, resigned from his post the following month after taking responsibility for misleading the media over party membership numbers amid the leadership race, which Humza Yousaf went on to win.
At the time, he said: “While there was no intent to mislead, I accept that this has been the outcome.”
In April 2023, Mr Murrell was arrested as part of a probe into the SNP’s funding and finances. He was later charged with embezzling SNP funds in April last year.
Ms Sturgeon and ex-party treasurer MSP Colin Beattie have also been arrested and released without charge as part of Police Scotland’s long-running Operation Branchform.
The probe, which has been ongoing since July 2021, is linked to the spending of around £600,000 raised by SNP supporters to be earmarked for Scottish independence campaigning.
Ms Sturgeon continues to deny any wrongdoing. In an interview last month, the Glasgow Southside MSP said she knew “nothing more” about the inquiry and was getting on with life “as best I can at the moment”.
This breaking news story is being updated and more details will be published shortly.