Boris Johnson has begun receiving very public job applications from would-be cabinet ministers, with Liz Truss pitching to be a tax-slashing chancellor and Amber Rudd ditching her opposition to a no-deal Brexit in a bid to stay on as work and pensions secretary.
With Johnson on the brink of No 10, senior Tories have begun laying out their credentials for positions in his potential cabinet – some with more hope than others.
Truss told journalists on Thursday that she wanted to be in the “engine room of the economy” driving growth, citing as her favourite chancellor Nigel Lawson – a Thatcherite Brexit supporter who denies climate science.
She praised Lawson for cutting the top rate of tax to 40% in 1988, and set out her view that the Conservatives must not be afraid to reduce taxes for higher earners, claiming this would contribute to economic growth.
Asked by the Guardian to respond to Jeremy Hunt’s criticism that Johnson’s plan for lowering the higher rate of tax threshold made them seem like the party of the rich, she said: “If we are never, ever prepared to cut taxes for people earning £60,000 I think that is a problem … I mentioned Nigel Lawson earlier. In his budget in 1988, he cut the top rates of tax … What it led to is an economic revolution in our country and we have to be prepared to make those arguments.”
Truss, who at one point referred to herself as “the Truss”, stuck closely to Johnson’s script on Brexit and said Theresa May’s deal was a “dead duck”, despite having voted for it three times and Johnson having voted for it once.
The senior Treasury minister was an early backer of Johnson and joked that if Jacob Rees-Mogg were to get her current job then she would leave him a note saying: “I’ll be just down the corridor” – implying that she would be promoted to chancellor.
Truss’s main rival for the role of chancellor is thought to be Sajid Javid, the former leadership hopeful, who is heavily rumoured to have done a deal with Johnson for the job. However, Johnson’s campaign team repeatedly insist that he has not promised anyone any job.
At the same time, Rudd, one of the leading cabinet opponents of hard Brexit, publicly ditched her opposition to no deal on Thursday in a move that appeared designed to show she would be willing to serve with Johnson as prime minister.
Rudd had previously joined with her cabinet colleagues David Gauke and Greg Clark to force Theresa May to take no deal off the table and stop the UK crashing out at the end of March.
But with Johnson on the brink of No 10, she has changed her mind, telling TalkRadio on Thursday morning: “Both candidates have said that no deal is part of the armoury going forward, and I have accepted that.
“The situation is that we are leaving at the end of October but it would be so much better to get a deal. What we really need is for everybody’s effort to go into trying to get a deal.”
Friends of Rudd said she would like to keep her job as work and pensions secretary in a Johnson cabinet and it was better to be around the cabinet table as an influence than on the backbenches.
Rudd is supporting Johnson’s rival for the leadership, Jeremy Hunt, who is also holding out the possibility of no deal. However, this is her clearest statement yet that she could be prepared to serve in the cabinet of a prime minister with an explicit no-deal policy.
Johnson and Hunt have said they want to avoid no deal and believe it is unlikely, but they need to keep it as an option if the EU will not offer changes to the Irish backstop. Critics of the backstop say it could trap the UK indefinitely in a customs union.
One of Johnson’s most senior Eurosceptic backers told the Guardian that the sight of centrist Tories falling over themselves to praise Johnson and saying “pick me, pick me” was now “embarrassing”.
He singled out Matt Hancock, a former leadership candidate, for mockery, saying he was behaving like an “annoying younger brother” on Johnson’s leadership campaign with excessive keenness and volunteering.
Johnson is reported to have told cabinet hopefuls to stop “peacocking” in their desperation to show their fitness for top jobs. Hancock had suggested that public sector workers needed to be shown “some love” with pay rises, and other top backers had put their names to a plan for merging government departments.
If the UK leaves the EU without a deal it would by default, become a “third country”, with no overarching post-Brexit plan in place and no transition period. The UK would no longer be paying into the EU budget, nor would it hand over the £39bn divorce payment.
The UK would drop out of countless arrangements, pacts and treaties, covering everything from tariffs to the movement of people, foodstuffs, other goods and data, to numerous specific deals on things such as aviation, and policing and security. Without an overall withdrawal agreement each element would need to be agreed. In the immediate aftermath, without a deal the UK would trade with the EU on the default terms of the World Trade Organization (WTO), including tariffs on agricultural goods. This has also been referred to by government ministers as an "Australia-style deal". Australia does not have a free trade agreement with the EU.
The UK government has already indicated that it will set low or no tariffs on goods coming into the country. This would lower the price of imports – making it harder for British manufacturers to compete with foreign goods. If the UK sets the tariffs to zero on goods coming in from the EU, under WTO “most favoured nation” rules it must also offer the same zero tariffs to other countries.
WTO rules only cover goods – they do not apply to financial services, a significant part of the UK’s economy. Trading under WTO rules will also require border checks, which could cause delays at ports, and a severe challenge to the peace process in Ireland without alternative arrangements in place to avoid a hard border.
Some no-deal supporters have claimed that the UK can use article XXIV of the General Agreement on Tariffs and Trade (Gatt) to force the EU to accept a period of up to 10 years where there are no tariffs while a free trade agreement is negotiated. However, the UK cannot invoke article XXIV unilaterally – the EU would have to agree to it. In previous cases where the article has been used, the two sides had a deal in place, and it has never been used to replicate something of the scale and complexity of the EU and the UK’s trading relationship.
The director general of the WTO, Roberto Azevêdo, has told Prospect magazine that “in simple factual terms in this scenario, you could expect to see the application of tariffs between the UK and EU where currently there are none”.
Until some agreements are in place, a no-deal scenario will place extra overheads on UK businesses – eg the current government advice is that all drivers, including lorries and commercial vehicles, will require extra documentation to be able to drive in Europe if there is no deal. Those arguing for a “managed” no deal envisage that a range of smaller, sector-by-sector, bilateral agreements could be quickly put into place as mutual self-interest between the UK and EU to avoid introducing or to rapidly remove this kind of bureaucracy.
Senior backers of Johnson believe he will create a cabinet mostly of Brexit “true believers” who are prepared to hugely increase spending on no-deal preparations.
Johnson has had at least one conversation with Michael Gove and is thought to be considering burying the hatchet by offering him a cabinet-level job and Dominic Raab, another former leadership rival, will also be angling for a senior role.
One MP involved in Johnson’s campaign said they thought Priti Patel would have to get a big job as he is short of senior Brexit-supporting women and that it would be difficult to move Penny Mordaunt from her post as defence secretary.
The MP also said Johnson had a “Gavin Williamson problem” as Williamson would expect a senior role but was not popular with colleagues and could not be allowed in a role involved with security as Theresa May sacked him as defence secretary over suspicions he leaked information from the national security council.
Iain Duncan Smith, the former Tory leader, is understood to be open to a big cabinet job after chairing Johnson’s campaign and keeping Eurosceptics on side. Others who could be rewarded include Grant Shapps, who prepared a hugely detailed spreadsheet to help Johnson keep track of support among MPs, and those who have gone out to bat for him in the media such as Johnny Mercer, James Cleverly and Michael Fallon. He may also remember old allies such as Ben Wallace, Jake Berry and Conor Burns when it comes to putting together his ministerial team.
A string of Tories have hardened their Brexit positions or put aside doubts about his no-deal stance in recent weeks in order to back Johnson.
George Freeman, a Tory moderate, was asked by his former colleague Heidi Allen whether he had “taken leave of his senses” by coming out strongly for Johnson.
He replied: “Couldn’t be more serious. We are, tragically, in a terrible mess: as a government, parliament and party. If we don’t honour the EU referendum result and leave the EU political union, with a bold programme of economic renewal to unlock growth, confidence and spread prosperity, we’ll get Corbyn.”
