Boris Johnson’s victory does not solidify his position, given the comparable result of his predecessors and their subsequent resignations
Despite PM Boris Johnson’s victory, his leadership has been severely affected by the open rebellion within his own party’s ranks. The government’s attempt to regain some popularity through a new fiscal program will likely boost demand among certain consumer segments, but will also increase policy unpredictability substantially, given the government’s reactionary approach. Furthermore, the new measures, expected to be announced next week, will require substantial budget revisions and potential reallocation of financial resources, which will significantly complicate B2G demand planning.
Mounting internal pressures within the Conservative party in the aftermath of the May local elections and additional revelations regarding the PM’s conduct triggered a leadership vote of no-confidence on the 6th of June. PM Boris Johnson survived the vote, managing to obtain 211 votes in support versus a 148 against his leadership. Despite his victory, the vote has exposed significant cracks within the Conservative government, with many prominent backbenchers and former ministers voting against the PM. Shortly after the vote was announced, the PM and Chancellor Rishi Sunak announced they will unveil new measures to support the economy and foster growth.
As outlined in our UK Outlook from February 2022, the expected poor result in the May local elections was likely to trigger a no-confidence vote against PM Boris Johnson. The war in Ukraine, however, changed political dynamics and gave the PM a much-needed lifeline, allowing him to extend his premiership. Yet despite his victory, PM Boris Johnson’s authority has suffered a significant hit, complicating policy-making and increasing the likelihood of future MP rebellions. Johnson’s own Tory PM predecessors have been forced to resign following unsuccessful no-confidence votes, despite achieving better or comparable results during the vote. Johnson’s particular premiership style, however, indicates that he is highly likely to double down and push through by consolidating internal support and attempting to win voters back through announcing new fiscal measures, which will likely include additional public investments and new tax cuts aimed at supporting lower-income households. The move is unlikely to prove successful in winning back support and could be struck down in the House of Commons, spelling doom for his government. This becomes even more pertinent in light of the government’s attempts to renegotiate the Northern Ireland protocol and will likely increase the urgency for Johnson to find an effective strategy. Furthermore, this also increases the risks surrounding the new, and controversial, Northern Ireland bill that threatens to unilaterally change the protocol, which could prompt punitive measures by the EU. As such, government policy is likely to become even more reactive to domestic political pressures and thus policy unpredictability is set to increase substantially. In the most likely scenario, it is a matter of time for a series of legislative defeats in parliament, constant pressure from rebel MPs, and defeats in two by-elections in late June, to force the Conservative 1922 Committee to change to leadership rules to allow another no-confidence vote within an year, in light of the PM’s combative stance. The PM is likely to resist any pressure to resign, but a signal that the Committee is considering changing the rules may force a resignation in the face of a potential humiliating defeat.
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