Star comment: Big challenges ahead for Sunak and Hunt
The UK finally has a competent Prime Minister, and an astute Chancellor, following a period of tumult.
The challenges they face, however, are significant, and many are of their party’s own making.
Jeremy Hunt has to get to grips with a number of issues, not least inflation and unemployment. While the headlines might not look too concerning – the unemployment rate remaining unchanged at 3.7 per cent – the fall in the number of vacancies points to the underlying fragility of the economy as firms hold back on recruitment.
It is interesting timing ahead of today’s Budget, which is widely expected to focus on boosting economic growth.
The Chancellor and the Prime Minister have focused on restoring Britain’s financial credibility in the wake of Liz Truss’s brief but disastrous spell as PM. To some extent, they have succeeded in bringing back stability but, as the unemployment figures demonstrate, that is only the beginning of their challenge. They must put in place an economic framework that will restore confidence among businesses and get Britain on track.
Our borrowing is too high and our productivity too low. Those from all sides of the political spectrum now believe that Brexit has set us back, at least in the short term. Recruitment is tough, exports are too low, our economy relies too heavily on services and not enough on manufacturing.
Mr Sunak and Mr Hunt have time now to undo some of the damage done by their predecessors, though we should not underestimate the scale of the task. Economic growth is the answer, though we remain in turbulent times.
Much like our economy, events of the last 12 months have served as a stark reminder that our world faces an uncertain and difficult future. The deal over nuclear-powered submarines has provoked a predictably strong response from China, who are accusing the UK, US and Australia of fuelling a new arms race.
Those with longer memories may draw parallels with the Cold War and the arms race between the Soviet Union and the US. With Putin’s Russia continuing to wage war in Ukraine, and North Korea continuing with its missile programme, there are worrying signs.
The Chinese position on Taiwan is a further concern and trouble is on the cards in the coming years.
We live in a challenging and complicated world where a new world order may well be emerging and where conflict remains entirely possible.