Rishi Sunak looks set to be next UK PM after Johnson quits race

  • Sunak may be declared the winner after 2pm
  • Penny Mordaunt races for support to challenge him
  • Borrowing costs lower as Boris Johnson out of the race

LONDON, Oct 24 (Reuters) – Rishi Sunak looks set to become Britain’s next prime minister after his rival Boris Johnson dropped out of the race. Admits he can no longer unite their parties after one of the most turbulent times in British political history.

Former finance minister Sunak, 42, could become Britain’s third prime minister in less than two months on Monday, tasked with restoring stability to a country plagued by years of political and economic turmoil.

The multi-million-dollar former hedge fund boss may slash spending in an attempt to rebuild Britain’s fiscal reputation as soaring energy and food costs drag the country into recession.

Sign up now for free and unlimited access to Reuters.com

“Britain is a great country, but we face a deep economic crisis,” Sunak said in a brief statement, announcing his qualifications to lead the Conservative Party and thus become prime minister.

Britain has been in the throes of a sense of perpetual crisis since voting to leave the European Union in 2016, sparking a battle in Westminster over the country’s future that remains unresolved.

The latest drama has drawn consternation from foreign capital and ridicule from the world media.

Johnson, the face of the Brexit referendum, led his party to a landslide victory in 2019 but was ousted less than three years after a string of scandals. His successor, Liz Truss, lasted just 44 days before she resigned over an economic policy that undermined the country’s economic credibility.

Sunak, who may be hours away from taking over, has not said how he plans to run the country, which he will inherit from a party torn by ideology that some lawmakers still blame for Johnson’s death.

The former prime minister’s exit on Sunday night also left some ministers and lawmakers outraged after they backed his return to Downing Street for looking stupid, only to have to change course and back Sunak hours later.

churn and instability

“It is unprecedented to see so much upheaval and instability since the beginning of the modern political era in 1832,” historian and political biographer Anthony Selden told Sky News.

If Penny Mordaunt fails to garner the support of 100 lawmakers by 2pm (1300GMT) on Monday, Sunak could become prime minister – and the country’s first non-white prime minister.

So far, the leader of the lower house of parliament, Mordault, has won the support of about 25 politicians. Her campaign spokeswoman said Monday she was “getting the numbers.” Over 150 people support Sunak.

If she fails to meet the threshold, Sunak will become prime minister. If she goes to the polls, members of the party – some of whom are believed to hold Sunak responsible for overthrowing Johnson – will pick a winner on Friday.

Britain’s borrowing costs eased on Monday after Johnson dropped out of the race, after Truss unveiled a “mini-budget” that included a £45bn unfunded tax cut.

Although Sunak has the support of multiple factions in the party, analysts and economists say they remain sceptical about his ability to unite the party.

Treasurer Jeremy Hunt – fourth in four months – will present his budget on October 1. On the 31st, the black hole plugging the public finances is expected to swell to £40 billion.

Private equity boss Guy Hands says Britain’s dominant party is no longer fit to run the country and it needs to accept that its vision for Brexit has not worked. Millions of people are getting poorer, he said.

“It has to move on from fighting its own internal war and really focus on what needs to be done in the economy, acknowledging some of the mistakes they’ve made over the last six years that, frankly, have put this country on the path to becoming the sick man of Europe ,” he told BBC Radio.

party unity

Investors have at least some reassurance that Johnson will not be fighting for the crown. The former prime minister rushed home from a Caribbean vacation to see if he could vote.

He said on Sunday night that while he had enough support, he realised he could not govern effectively “unless you have a united party in parliament”.

“Boris has bottled it,” the Metro newspaper said on its front page, with many lawmakers questioning whether he really had the necessary support of 100 lawmakers. By Sunday, just over 50 people had publicly said they would vote for Johnson.

Many of Johnson’s supporters have previously accused Sunak of betrayal after resigning as finance minister in the summer, sparking a rebellion that forced Johnson from office.

Sunak first came to national attention when he, 39, set up a successful furlough scheme as finance minister under Johnson when the COVID-19 pandemic hit the UK.

If selected, the former Goldman Sachs analyst would become Britain’s first prime minister of Indian origin.

His family moved to the UK in the 1960s, when many people from the former British colonies moved to the country to help it rebuild after World War II.

After graduating from Oxford, he later went to Stanford University, where he met his wife Akshata Murthy, the son of Indian billionaire NR Narayana Murthy, the founder of outsourcing giant Infosys Ltd.

Sign up now for free and unlimited access to Reuters.com

Writing by Kate Holton, Additional reporting by Muvija M, William James, Paul Sandle, James Davey; Editing by Angus MacSwan and Hugh Lawson

Our Standard: The Thomson Reuters Trust Principles.

Source link