Rishi Sunak: Britain’s Economic Jedi Who Could Be Premier

(Bloomberg) -- Rishi Sunak made his first bid for power at an auction house.

It was October 2014 and the Conservative Party was interviewing candidates to fill the intimidating vacancy left by former party leader William Hague in the northern English district of Richmond. At the selection hearing in Tennants Auctioneers in Leyburn, Sunak faced some tough opponents, including a former army lieutenant-colonel and Wendy Morton, who is now a fellow minister in Boris Johnson’s government.

Sunak stood out. “It was his confidence and unflappability,” said Christopher Robson, an 83-year-old former local party chairman who was in the room that day. “People who don’t flap are enormously valuable, they just get on with an enormous amount of work.”

It is just as well Sunak is so cool. The question his colleagues are pondering now is whether the Chancellor of the Exchequer could eventually step up to become their next prime minister, or whether his career will be crushed under the weight of broken businesses and lost jobs if he fails to save the U.K. from its worst recession in 300 years.

On Wednesday, the 40 year-old faced his toughest moment so far. Five months after being thrust into the job as finance minister, he started to chart a way out of the economic crisis, outlining 30 billion pounds ($38 billion) of stimulus measures to encourage the public to start spending again after more than three months of lockdown. He’s promised more measures in a budget in the fall.

The coming months will tell whether he can avert an unemployment disaster as he unwinds government aid that is paying the wages of more than 12 million jobs. The package announced on Wednesday focused on preserving the jobs of furloughed workers, getting younger people into new roles, and reviving struggling hospitality and property sectors.

As he wrapped up his address to the House of Commons, Sunak showed he has an eye on the history books.

“Governments, much less people, rarely get to choose the moments which define them,” he said. “We will not be defined by this crisis, but by our response to it.”

Winning Combo

The vast scale of Treasury grants and loans so far has earned Sunak praise from business bosses as well as some unexpected new fans, including the left-wing union leader Len McCluskey, and -- across the Atlantic -- the Democratic firebrand Bernie Sanders, who called it “the proper approach.”

According to a poll of party members for the ConservativeHome website, he enjoys a 92% approval rating, some 35 points ahead of Johnson. Little wonder then, that, Sunak is now being talked about as a replacement for when the prime minister eventually steps down.

Three Conservative MPs told Bloomberg they could see Johnson leaving office before the next election, which is due in 2024, though the prime minister’s team has dismissed the idea. Most Tories speak “very highly” of Sunak, one MP said. “He’s bright and human -- a winning combo.”

When asked recently about his own leadership ambitions, Sunak was careful to be modest without ruling anything out. “It is a great privilege to have this job,” he told Sky News. “At the moment, we are all pulling together in one team.”

Oxford, Goldman

Sunak was born in Southampton, on England’s south coast, to parents of Indian origin who emigrated to the U.K. from east Africa in the 1960s. He wasn’t the classic Conservative candidate for Richmond, where just 1.5% of the local population are ethnically Asian.

His skin color was a subject he spoke about in his first speech to Parliament in 2015, recounting how on the campaign trail he was introduced to one farmer as the “new William Hague.” “He looked at me, quizzically, then said, ‘Ah yes, Haguey! Good bloke. I like him. Bit pale, though. This one’s got a better tan.’” Sunak recalled.

But in other ways, he is also a typical Tory. The son of a pharmacist and a doctor, he was educated at one of England’s most renowned schools, Winchester, and then Oxford. He spent three years at Goldman Sachs Group Inc. and later gained an MBA from Stanford in California, where he met his wife Akshata Murthy, the daughter of Indian billionaire, Infosys Ltd. co-founder Narayana Murthy.

For another three years or so, Sunak worked at billionaire activist hedge fund manager Chris Hohn’s TCI Fund Management, before moving to join his TCI colleague Patrick Degorce’s hedge fund Theleme Partners.

Jedi Knight

Working in the city of London in the financial crisis made an impact, and in October he told the BBC’s “Political Thinking” podcast that he’d had sleepless nights as investments shed hundreds of millions of pounds in value. “You are responsible for people’s savings and, you know, when that’s all kind of evaporating in front of your eyes, that that’s quite stressful thing to live through,” he said.

Sunak is famous for being a Star Wars fan who wanted to grow up to become a Jedi knight. He was pictured on Twitter with Sajid Javid, the man he later succeeded as chancellor, at the cinema on a night out to watch The Rise of Skywalker. Sunak’s own slick social media operation has also attracted attention, with his official tweets personally branded with coloring and his own signature.

Conservatives are starting to notice the Chancellor’s new profile. One Tory aide said that Sunak’s decision to hire the journalist Allegra Stratton as his director of strategic communications in April had boosted his image, while another notes that Johnson’s team have noticed his sharper and more independent identity. For now, it suits Johnson for Sunak to be seen as credible on the economy and as “a statesman to keep the markets afloat,” the aide said.

“Bring Data”

Johnson’s team likes him and still trusts him because he works so closely with the premier and his advisers. They wanted Sunak as chancellor several months before he got the job. Now they expect loyalty from him in return for his quick promotion. An open question is how far he is simply following the orders of Johnson and his powerful aide Dominic Cummings, and to what extent Sunak’s policies represent his own radical vision for Britain.

He says his guiding principle is to master the details before reaching a conclusion -- and officials who work with him are impressed. Sunak likes to quote his father-in-law’s rule to sum up his approach: “In god we trust, but everyone else needs to bring data to the table.”

Still, not all Tories are fans. He is a teetotaler who is not known for schmoozing in Parliament’s bars and hasn’t accrued a large following in his five years in Parliament. One colleague points out that the chancellor has flip-flopped on his coronavirus response; rejecting 100% state-backed loans before bringing them in, for example. “The one thing that baffles me is how Rishi is apparently so saintly after saying one thing and then doing another,” the MP said. “He’s not the messiah.”

Picking Winners

He isn’t immune to missteps either. On Tuesday, Sunak was pictured leafing through drafts of his plan to save jobs -- with the unfortunate prop on his desk of a 180-pound ($226) coffee cup. With Johnson just a year into the job and Sunak five months into his role, several MPs cautioned that it’s premature to talk about succession.

Back in Richmond, the local Tory party prides itself on picking winners: Sunak was preceded by Hague, who led the party before becoming foreign secretary in David Cameron’s government, and former Home Secretary Leon Brittan. Could Sunak go a step further and be prime minister?

“Yes,” says Robson. But the chancellor’s real test is just beginning, he warns. “It’s easy to be popular when you’re doling out vast sums of money. It’s more of a test when you’re getting it back.”

©2020 Bloomberg L.P.