Insight

Conservative Party Conference 2021

06th October 2021

A change of direction

At the end of the first in-person Conservative Party Conference since the 2019 election landslide, Boris Johnson delivered a characteristically optimistic speech where he pledged that the focus of his government would be to “get on with our job of uniting and levelling up across the UK”. However, he also conceded that there was a hole in the public finances following the COVID crisis and portrayed tax rises as necessary, arguing that Margaret Thatcher would have done the same.

While the fringe has seen lively discussion and receptions have been full of Conservative activists and MPs in a confident mood, proceedings on the conference floor were more muted. There have been few announcements, the contribution of those Cabinet ministers invited to speak have been short and the auditorium smaller than usual. That changed today as the Prime Minister spoke to an enthusiastic and energised audience. Despite concerns from some on the right of the party at the new direction under his leadership, there is little doubt that it is now very much Boris Johnson’s Conservative Party.

In media interviews throughout the week, the Prime Minister has responded to supply issues, labour shortages and the cost of living, by arguing that the correct response was for business to invest in skills and training and pay higher wages, rather than for the country to respond as he put it “by pulling the lever marked uncontrolled immigration.”

In his speech today he continued to blame “uncontrolled immigration” for “low wages, low growth, low skills and low productivity”. He said that this government would “deal with the biggest issues facing the country” which he claimed that “no government has had the guts” to deal with before, criticising not only Labour governments, but Conservative ones too. An approach that eschews political orthodoxy, but one which many will argue is the essence of his appeal to the public.

Although business leaders have been warning ministers of rising taxes, escalating costs, labour shortages and supply disruption, they have received short shrift from the government, emboldened perhaps by focus groups and polling showing that the public does not yet blame the government for this developing situation.

Indeed, Boris Johnson seems to have decided that it is better to double-down, rather than retreat, arguing today that this was a necessary period of adjustment and part of the levelling up process. The prize, he argued, was “a high wage, high skill, high productivity economy that the people of this country need and deserve, in which everyone can take pride in their work and the quality of their work.”

Today, he tried to explain what levelling up means to him – a concept that has so far been somewhat undefined. “In a nutshell: you will find talent, genius, flair, imagination, enthusiasm — all of them evenly distributed around this country – but opportunity is not, and it is our mission as Conservatives to promote opportunity with every tool we have.” Clearly drawing on feedback from focus groups he said that people did not want to “feel they have to move away from their loved ones, or communities, to reach their potential.”

In one of the few new announcements today, he pledged a “levelling up premium of up to £3,000 to send the best maths and science teachers to the places that need them most”. Indeed, there was a sense that today was about making the political argument for the government’s direction and that policy for the coming years would be crystallised by announcements later this month, around the Budget and Spending Review. Expect to see the White Paper on Levelling-up published at around the same time.

The Prime Minister’s advisers will leave Manchester feeling that this year’s conference was a job well done. Whether by design or by accident, the Prime Minister has alighted on an argument that labour or goods shortages are part of the growing pains of an economy that is going through necessary structural change as part of his levelling up agenda. Business may be annoyed at this approach, but for now, at least, the public is with him.

But make no mistake, this is a gamble. If it succeeds, then Boris Johnson and the Conservatives will be sailing towards another term in office. But if things get worse over the winter and we see shortages, rising inflation and interest rates creeping up, the public mood may turn and do so quickly.

Boris Johnson is a high stakes politician. Eventually, as every politician and gambler knows, luck runs out. The Prime Minister and the Conservative Party will be hoping and believing that that is many years down the track.

Five top-line takeaways from this year’s conference:

• This is now clearly Boris Johnson’s Conservative Party. Conference organisers relegated the rest of his Cabinet and potential rivals to a smaller auditorium with limited speaking time, while the Prime Minister dominated the airwaves and had his own purpose-built stage for today’s Leader’s Speech.
• Despite concerns and grumbling from parts of the right of the Conservative Party about high levels of taxation, public spending and government intervention, party strategists believe that there is the opportunity to cement and even grow the new political coalition assembled at the 2019 election, by taking a centrist approach to politics, but one which tilts more to the left on economic issues and to the right on social and cultural ones.
• Whether by accident or necessity, Boris Johnson and his strategists believe they have found a key dividing line in response to supply issues and the cost-of-living crisis – arguing that Conservatives want to see higher pay and better conditions, while Labour would “pull the lever of uncontrolled immigration.” This has implications beyond a political argument with Labour. Although the PM was careful in what he said today, behind the scenes and in media briefings at this conference Conservatives have at times used remarkably strident language, arguing that business had “become drunk on uncontrolled immigration and low wages” leading to underinvestment in skills and infrastructure.
• With the next election expected in the next two to three years, the focus now is on delivering some quick wins that demonstrate the party is getting on with the job they were elected to do. It will take time to readdress regional under-investment of past years and voters will want to see improvements that affect their daily lives, whether that’s a better local bus service or improving the town centre. Expect to see more empowerment of local leaders to take the decisions that will make a difference to their own citizens.
• The PM is nothing if not an optimist, but even by his standards his assertion that supply chain issues would resolve themselves and that he was not concerned about the threat of inflation or rising interest rates is something of a gamble. It may well pay off should the country get through the winter unscathed, but history tells us that if things go badly wrong, it is often the most popular Prime Ministers who fall the hardest.