Economic Policy in Disarray After Javid Quits: U.K. Reshuffle
Sajid Javid quit as Chancellor of the Exchequer following a row with Boris Johnson, sending the prime minister’s Cabinet reshuffle off course and raising questions over U.K. economic policy.
Rishi Sunak was appointed to replace Javid, but the prime minister’s spokesman was unable to confirm that the budget will still be held on March 11 or if the government will stick to Javid’s fiscal rules.
Johnson earlier fired a clutch of senior ministers, including Business Secretary Andrea Leadsom, as he seeks to stamp his authority on his top team after winning a big majority in December’s general election.
- Javid quits after argument with Johnson over advisers
- Sunak named Chancellor; he has long been viewed as a rising star in the Conservative Party
- Attorney General Geoffrey Cox and Northern Ireland Secretary Julian Smith confirm their dismissals
- Foreign Secretary Dominic Raab, Cabinet Office Minister Michael Gove, Home Secretary Priti Patel stay in their posts
Javid: Johnson Must Protect Treasury Credibility (5:45 p.m.)
Sajid Javid’s resignation letter included a warning to Johnson not to risk the Treasury’s reputation and to “ensure the Treasury as an institution retains as much credibility as possible.”
He told the premier that ministers should be able to have their own teams around them who can give them “clear and candid” advice, a riposte to Johnson’s demand that he should fire all his advisers as a condition for keeping his job (see 5 p.m.).
Javid: I had ‘No Option’ But to Quit (5 p.m.)
Sajid Javid told reporters outside his home that he had “no option” but to resign after Boris Johnson told him the conditions for keeping his job as chancellor of the exchequer.
“‘Whilst I was very pleased that the prime minister wanted to reappoint me, I was unable to accept the conditions that he had attached, I felt I was left with no option other than to resign.” Javid said.
“The conditions that were attached was a requirement that I replace all my political advisers, these are people who had worked incredibly hard on behalf of not just the government but the whole country, done a fantastic job, I was unable to accept those conditions,” he said. “I don’t believe any self-respecting minister would accept such conditions, so therefore I decided the best thing to do was to go.”
Brandon Lewis Named Northern Ireland Secretary (4:40 p.m.)
Brandon Lewis was appointed Northern Ireland Secretary, replacing Julian Smith, who was the first cabinet minister to be fired this morning.
Lewis has held a string of ministerial roles, most recently serving as security minister for Johnson’s government since July. He’s also been the Conservative Party Chairman and held the ministerial briefs for immigration, policing and housing.
He takes the job at a tricky time, with the devolved government in Northern Ireland only just resuming activity after three years of suspension. Since Smith was fired, a succession of figures from both side of the border have praised him for his role in helping restore power sharing to Northern Ireland and Lewis will hope the goodwill is extended to him.
Javid Move Throws Economic Plans Into Doubt (4:27 p.m.)
The resignation of Sajid Javid has thrown the U.K.’s economic plans into doubt.
Speaking to reporters on Thursday, Boris Johnson’s spokesman could not confirm that the budget will still be held on March 11 or whether Sajid Javid’s fiscal rules would still apply. The comments are a sign that changes at the Treasury will go deeper than the personnel at the top.
“The government has a very ambitious agenda in relation to leveling up and you can expect to see No. 10 and the Treasury working closely together to deliver on promises to the British public,” Johnson’s spokesman James Slack said at a briefing.
The fiscal rules introduced by Javid allow for an extra 20 billion pounds ($26 billion) of infrastructure spending but require day-to-day spending and revenue to be in balance within three years.
Barclay Appointed Chief Secretary to the Treasury (4:20 p.m.)
Former Brexit Secretary Stephen Barclay was appointed chief secretary to the Treasury, replacing Rishi Sunak after his promotion to Chancellor.
It’s a reward for Barclay’s handling of the Brexit portfolio, where he focused on domestic preparations, and which ceased to exist after Britain left the EU on Jan. 31.
Barclay worked as economic secretary to the Treasury from June 2017 to Jan. 2018, and has also been a health minister.
Braverman Wants to Curb Powers of Judiciary (3:30 p.m.)
The appointment of Suella Braverman as Attorney General – the government’s chief legal adviser – could be seen as a signal of intent by Johnson to curb the powers of the judiciary (see 2:45 p.m.)
The prime minister was humiliated in September when the Supreme Court ruled he had acted wrongly by pushing through a five-week suspension of Parliament in the run-up to his deadline for leaving the European Union. That decision was cited by Braverman in an article less than three weeks ago entitled “People we elect must take back control from people we don’t. Who include the judges.”
“Repatriated powers from the EU will mean precious little if our courts continue to act as political decision-maker, pronouncing on what the law ought to be and supplanting Parliament,” Braverman wrote on the ConservativeHome website. “To empower our people we need to stop this disenfranchisement of Parliament.”
George Eustice appointed Environment Secretary (3:20 p.m.)
George Eustice has been appointed environment secretary, replacing Theresa Villiers.
A long-serving minister in the Environment department, Eustice campaigned for Britain to leave the EU and briefly resigned from his post in 2019 in protest over Theresa May’s handling of Brexit.
The same year, he wrote an article for the Guardian newspaper saying food standards should not be sacrificed in any trade deal between the U.K. and the U.S., putting him on collision course with President Donald Trump’s administration.
Eustice worked on his family fruit farm before starting a career in politics, which included being David Cameron’s press secretary from 2005 until 2007. Eustice was elected to Parliament in 2010, and has worked in the Environment department since 2013.
Braverman appointed Attorney General (2:45 p.m.)
Staunch Brexit supporter Suella Braverman has been appointed attorney general, replacing Geoffrey Cox, Johnson’s office said.
A lawyer by training, Braverman was chairwoman of the pro-Brexit European Research Group from June 2017 to January 2018. She quit as parliamentary under-secretary at the Brexit department in Nov. 2018 in protest at then Prime Minister Theresa May’s draft withdrawal agreement. She was one of the self-styled “Spartans” who voted three times against May’s deal.
Born in Harrow, London, her parents emigrated to Britain in the 1960s from Kenya and Mauritius. She studied Law at Cambridge and read a Masters at the Pantheon-Sorbonne in Paris. Before being elected to Parliament, she worked as a barrister.
Dowden Promoted to Culture Secretary (2:10 p.m.)
Oliver Dowden was promoted to Culture Secretary, replacing Nicky Morgan, who said earlier she stood down on her own volition (see 10:30 a.m.)
Dowden inherits the tricky task of piloting controversial legislation through Parliament allowing Chinese firm Huawei Technologies Co. to help develop Britain’s next-generation broadband networks. It’s an issue that’s seen significant opposition from Conservative lawmakers.
Dowden supported Britain remaining in the EU in the 2016 referendum and was a deputy chief of staff to former Prime Minister David Cameron. He was elected to Parliament in 2015 and elevated to Johnson’s top team as a minister for the Cabinet Office in July.
Trevelyan Named Development Secretary (1:40 p.m.)
Anne-Marie Trevelyan was named international development secretary, replacing Alok Sharma, who took the business portfolio.
Previously minister for the armed forces, Trevelyan is a vocal Brexit supporter. She resigned from her position as a parliamentary private secretary in 2018 in protest over former Prime Minister Theresa May’s draft divorce deal with Brussels.
Elected in 2015, she joined the pro-Brexit European Research Group and represents the northern community of Berwick-upon-Tweed, which has an active fishing community. She has been a regular advocate of the U.K. regaining control of its fishing waters after leaving the EU.
McDonnell Bids Farewell to ‘Chino’ (12:50 p.m.)
John McDonnell, economy spokesman for the main opposition Labour Party, said Sajid Javid’s resignation showed that Dominic Cummings, Johnson’s most senior adviser, had taken over the U.K.’s purse strings.
“Dominic Cummings has clearly won the battle to take absolute control of the Treasury and install his stooge as Chancellor,” McDonnell, who earlier this week taunted Javid as “Chino,” or “Chancellor in name only,” said in a statement.
Javid was in the job for less than seven months, making him the shortest-serving chancellor for 50 years.
Sharma Named Business Secretary (12:45 p.m.)
Alok Sharma has been promoted to Business Secretary, replacing Andrea Leadsom.
Sharma, previously International Development Secretary, will also oversee the next stage of global climate change talks, known as COP 26, in Glasgow this year.
Despite backing Remain in the 2016 referendum on the U.K.‘s EU membership, Sharma, 52, was loyal to both Theresa May and Boris Johnson on Brexit, consistently voting for their divorce deals in the House of Commons.
Pound Rallies on Fiscal Speculation (12:30 p.m.)
The pound rallied above $1.30 while gilts fell after Sajid Javid resigned as Chancellor of the Exchequer, causing speculation the U.K. may move toward more fiscal stimulus.
Javid’s departure led to speculation there may be increased fiscal spending as Boris Johnson moves away from Javid’s already loosened fiscal rules.
Sunak appointed Chancellor (12:20 p.m.)
Rishi Sunak, who was chief secretary to the Treasury before Sajid Javid’s dramatic resignation, was appointed to succeed him in the top job at the Treasury.
Sunak is seen as a rising star in the Conservative Party, who worked at Goldman Sachs and in hedge funds before his career in politics. Elected to Parliament in 2015, he backed Brexit and was promoted to his Treasury role by Johnson last year.
A graduate of Oxford with an MBA from Stanford, he represented the Tories in TV debates during the 2019 general election.
Gove, Raab, Patel Stay in Post (12:15 p.m.)
Foreign Secretary Dominic Raab and Michael Gove, the Chancellor of the Duchy of Lancaster, will stay in their jobs, Johnson’s office said in an email. Home Secretary Priti Patel is also staying on.
Javid Quits as Chancellor (12 p.m.)
Sajid Javid quit as U.K. Chancellor of the Exchequer, a shock departure from Boris Johnson’s government.
Javid was offered the job on the condition that he sacked all five of his special advisers at the request of the prime minister, which he refused, according to two people familiar with the matter.
Javid had served as Britain’s finance minister since July 2019. His departure comes just weeks before the budget, where he was expected to announce a “decade of renewal” with tax cuts and spending for disadvantaged areas.
Javid stood for leadership of the Conservative Party against Johnson last year, coming fourth in the race, before being appointed Chancellor.
Javid Quits as Chancellor, Sun Reports (11:50 a.m.)
Sajid javid has quit as chancellor of the exchequer, the Sun newspaper reported, without saying where it got the information.
Varadkar Adds to Praise for Smith (11:30 a.m.)
Ireland’s Prime Minister Leo Varadkar added to the praise for fired Northern Ireland Secretary Julian Smith, further underlining the respect there is for him across the Irish Sea.
Smiling Ministers Remaining in Cabinet (11:25 a.m.)
Several Cabinet ministers have already been spotted arriving at Johnson’s office in Number 10 Downing Street with smiles on their faces. The fact that they are walking up Downing Street is a clear sign that they’ll still be in Johnson’s top team at the end of the day -- though they may change jobs.
Chancellor Sajid Javid, Foreign Secretary Dominic Raab, Cabinet Office Minister Michael Gove, Home Secretary Priti Patel, Justice Secretary Robert Buckland and International Development Secretary Alok Sharma have all entered Number 10 through the famous black door.
Ireland’s Coveney Thanks Smith (10:45 a.m.)
Simon Coveney, Ireland’s deputy prime minister, sent a message of support to Julian Smith, who won the respect of politicians in Dublin and Belfast for his role in restarting power-sharing in Northern Ireland last month (See 9.25 a.m).
Coveney described Smith as “effective” at “a time of real challenge and risk” and said the restoration of the government in Northern Ireland would not have been possible without his leadership.
Smith’s replacement will have to work fast to build up trust on both sides of the border. Trade arrangements on the island of Ireland, and the continuation of the peace process, will come under strain in ongoing negotiations on the U.K.’s future partnership with the EU.
Morgan Leaves Cabinet of Own Volition (10:30 a.m.)
Nicky Morgan told Bloomberg that she’s left the cabinet of her own volition, in a move that had been widely expected. She stepped down from the House of Commons at the general election, but Johnson appointed her to the House of Lords and persuaded her to stay on in her role as Culture Secretary until the reshuffle.
Morgan’s successor will inherit a headache in the government’s decision to allow Huawei Technologies Co. to be involved in the U.K.’s 5G telecom networks: there’s growing opposition to the decision among rank-and-file Conservative members of Parliament.
Cox Quits at PM’s Request (10:25 a.m.)
Attorney General Geoffrey Cox confirmed he has been forced out of the cabinet by Johnson, publishing a letter to the prime minister in which he said he was “writing to resign that office, as you requested.”
Cox, who provided often controversial legal advice to the government as first Theresa May, then Johnson, tried to get Brexit through Parliament, said he had sought to give “candid and independent” guidance to ministers.
He also used the letter to remind the prime minister that he had introduced him at the launch of his campaign to be Tory leader last summer, underlining the turnaround in the relationship between the two men.
Villiers Confirms She’s Been Fired (10:10 a.m.)
Theresa Villiers confirmed she’s been fired as environment secretary in a post on Facebook listing her achievements in office, including publishing “the most important Environment Bill for decades.”
“What the Prime Minister giveth, the Prime Minister taketh away,” Villiers wrote. “Just over six months ago, I was delighted to be invited by the Prime Minister to return to government after three years on the backbenches. This morning he told me that I need to make way for someone new.”
Johnson Ousts Business Secretary Leadsom (10 a.m.)
Prominent Brexiteer Andrea Leadsom confirmed she’s been fired from Boris Johnson’s Cabinet and will no longer serve in his government.
Leadsom, 56, twice ran for leader of the Tory party and had been business secretary in Johnson’s government since July. Her resignation from Theresa May’s Cabinet last year helped to precipitate the former prime minister’s downfall, which paved the way for Johnson to take over.
McVey Fired From Cabinet (9:55 a.m.)
Esther McVey has been fired as housing minister, she said on Twitter, before pledging her continuing support to the government.
“I’m very sorry to be relieved of my duties as Housing Minister,” she wrote. “I’m very grateful to the Prime Minister for having given me the opportunity to serve in his government & he will continue to have my support from the back benches.”
McVey, a prominent Brexiteer, was appointed to the role by Johnson when he took office in July.
Smith Confirms He’s Left Cabinet (9:40 a.m.)
Julian Smith confirmed by phone that he’s been sacked as Northern Ireland Secretary, clarifying his Tweet earlier suggesting that was the case (see 9:35 a.m.)
Smith Suggests He’s Been Fired (9:25 a.m.)
Julian Smith indicated on Twitter he’s been dismissed as Northern Ireland Secretary.
“Serving the people of Northern Ireland has been the biggest privilege. I am extremely grateful to Boris Johnson for giving me the chance to serve this amazing part of our country,” Smith wrote. “The warmth & support from people across NI has been incredible. Thank you so much.”
Smith appears to have been sacked from the role despite being credited with bringing the opposing parties in Northern Ireland together to restart the province’s power-sharing executive last month after a three-year hiatus.
Tory Party’s Challenge With Women (8:45 a.m.)
While Boris Johnson plans to promote more women to junior roles in Thursday’s government reshuffle, a look at the makeup of the Parliamentary Conservative Party shows the challenge it faces in pushing women up through the ranks.
While a record 87 women were elected Conservative Members of Parliament in December’s election, that’s still just 24% of the party’s 365 MPs. The opposition Labour Party, by contrast, has 104 women among its 202 MPs.
Currently, seven out of the Cabinet’s 22 full members are women; of the 32 ministers who attend Cabinet (including full members), 8 are women.
Pickles: Reshuffle Vital for Getting Things Done (Earlier)
Former Conservative Party chairman Eric Pickles urged Boris Johnson to select people who can deliver on policies by effectively running their departments, rather than just because they are good media performers.
“Who can get things done? You can be the greatest communicator in the world, but if you can’t get things done you’re not that much use to a government,” Pickles told Sky News. “The big question is what is the government going to be like for Boris over the next two years, because ff he gets this reshuffle wrong, he isn’t really going to be able to change very much.”
Meanwhile Tobias Ellwood, Tory chairman of the House of Commons Defence Committee, said the prime minister needs to ensure there are dissenting voices around the cabinet table. “A good confident prime minister needs people round the table who will take collective responsibility but also tell perhaps the things he doesn’t want to hear,” he told Sky News.
©2020 Bloomberg L.P.