Jeremy Hunt, Britain’s chancellor, spends a lot of time telling colleagues he wants to do “the right thing” in this week’s Budget. Many Conservative MPs have a simpler priority: they want the Budget to help save their seats.
“Hunt’s approach is to play it safe, but facing an election we need someone bold and visionary,” said one Tory MP, whose party is trailing Labour badly in the polls. “The public wants change and he doesn’t represent change.”
But Hunt insists that doing the right thing for the economy is also good politics. “The sweet spot for Jeremy is something that underpins growth, but also delivers a political dividend,” said one ally of Hunt.
Finding that sweet spot will be a huge test for Hunt, whose March 6 Budget is expected to deliver the personal tax cuts that some Tory MPs believe are essential ahead of the general election, expected this year.
Many Tory MPs believe Hunt has deliberately played down expectations ahead of the Budget so he can spring a surprise of a mass-market 2p tax cut to the main rate of income tax, to bolster the party’s ailing fortunes.
The chancellor has argued that fast-growing economies like the US and in Asia have low taxes and that the state has a “moral duty” to hand back cash to taxpayers facing the highest tax burden for over 70 years.
Hunt’s 18-year parliamentary career has seen him take roles including foreign secretary and health secretary, but nothing prepared him for the chaos that greeted him when he became chancellor in October 2022.
Liz Truss, the shortlived Tory premier, appointed Hunt to clear up the mess bequeathed by the former chancellor Kwasi Kwarteng, whose “mini” Budget had sparked panic in the markets.
“The Treasury will be forever grateful to him for taking a grip immediately and telling Truss what had to be done,” said one Treasury veteran. “He stabilised the ship in 2022.”
“He is well regarded in the Treasury as a sensible person who, left to his own devices, will try to do the right thing. But I don’t think he’ll go down in history as a radical reforming chancellor,” they added.
Tory MP Steve Brine, who served as a minister alongside Hunt at the health department, said: “He’s a very level person, an incredibly positive person. Officials like working for him because he’s very calm.
“I’ve only ever seen him raise his voice once. That was during the junior doctors strike and we were having a particularly hairy day,” said Brine.
Government insiders said Hunt, who is training for the London marathon, and Prime Minister Rishi Sunak regularly talk about “doing the right thing”. There is recent evidence of them putting economy before party.
When Hunt delivered his Autumn Statement last November, he spent £10bn on national insurance cuts and a further £10bn on creating a generous “full expensing” capital allowance regime for business.
One minister said: “Jeremy spent an awful lot of time on full expensing, which only about three people understand. There wasn’t a single vote in it for us.”
Friends of the 57-year-old Hunt said he is thinking about his legacy and how he will be judged in future. They added he is realistic enough to know he is unlikely to be chancellor this time next year.
Lord Ken Clarke, former Tory chancellor, is said by Hunt’s allies to be a particular hero: Clarke oversaw an economic revival in the 1990s which ultimately was inherited by the incoming Labour chancellor Gordon Brown.
Tory MPs and some in Downing Street are pushing Hunt to focus this Budget more on the short-term priority of saving the Conservatives from an electoral meltdown in the coming months.
Hunt has rejected ahead of the Budget some of the supposed vote-winning policies advocated by some Tory MPs, notably cutting inheritance tax or business rates. Raising tax thresholds was also deemed too costly.
George Osborne, the former Tory chancellor, has claimed there are “tensions” between Hunt and Sunak on whether to target scarce resources on a cut to national insurance or income tax.
Hunt’s instincts are to cut national insurance — a levy on workers — because such moves promote work, while income tax is a broader levy also paid by landlords, people with share dividends and wealthy retirees.
“Income tax cuts are more popular — people understand them,” said one Tory official. One MP close to Sunak said: “Number 10 wants to go for income tax cuts.”
People close to the Budget process said some in Number 10 also wanted to sharply cut back spending plans pencilled in for the next parliament to create fiscal space for tax cuts now. “Jeremy is more cautious,” said one person briefed on the discussions.
But Sunak’s allies insisted there was “no difference” between Hunt and Sunak on the question of personal tax cuts and said they “don’t recognise” suggestions of a difference on approach to spending.
“Rishi and Jeremy take a considered and reasonable approach — they don’t do rash things,” said one Number 10 insider, who added that Sunak and Hunt had held four formal Budget meetings in the last month.
Some Tory MPs would prefer Hunt to be more of a risk taker. Sir Jacob Rees-Mogg, a former cabinet minister, said the key Budget test for him was whether he could envisage shadow chancellor Rachel Reeves delivering it.
“If the answer is yes, you wonder what the point is,” he said. “If the answer is no, you assume something positive is being done.”
Labour will argue that Hunt’s Budget will already be risky enough, especially if he leaves what Reeves has called a “scorched earth” fiscal landscape of stretched public finances and further cuts to already depleted public services.
But Sir Robert Buckland, a moderate Tory former minister, said: “Is Rachel Reeves really going to deviate from Hunt? Probably not. He has set the economic course for the UK well into the next parliament.”
Buckland acknowledged that some critics derided Hunt as “a little too cautious, too much in the play of Treasury orthodoxy”, but he said: “I think he’s played it as well as, or better than, anyone could have in his shoes.”