Rishi Sunak will confront one of the toughest difficulties of any new leader when he becomes prime minister of the United Kingdom on Tuesday, October 25. He will have to deal with an escalating economic crisis, a political party in civil war, and a bitterly divided nation.
The 42-year-old former finance minister becomes Britain’s third prime minister in less than two months, after Westminster infighting and bickering frightened investors and scared international allies.
The former hedge fund manager – and one of the wealthiest lawmakers in parliament – will now need to find severe expenditure cutbacks to cover a $40 billion shortfall in the public budget at a time when his party’s popularity has fallen in the country.
On Monday, October 24, he warned his Conservative colleagues that the party faced a “existential crisis” if it did not assist shepherd the nation through what he termed a “deep economic problem.”
“We now require stability and togetherness, and I will make it my top goal to unite both our party and our nation,” he stated.
Sunak, the youngest British prime minister in more than 200 years and the country’s first leader of color, will succeed Liz Truss, who quit after 44 days due to a “mini budget” that shook financial markets.
In light of rising debt interest rates and weakening economic prospects, he will need to scrutinize all expenditure, particularly on politically sensitive areas like as health, education, military, welfare, and pensions.
After being installed by King Charles at Buckingham Palace, his first responsibility will be to form a cabinet of senior ministers, which some Conservative legislators believe would include parliamentarians from across the party’s spectrum.
After the former foreign and health secretary helped calm jittery bond markets by dismantling the majority of Truss’s economic policy, he is poised to keep Jeremy Hunt as finance minister.
Investors will also want to know if Sunak will adhere to his plan to release a fresh budget accompanying borrowing and growth projections on October 31, which would assist shape the Bank of England’s next interest rate decision on November 3.
Sunak, a Goldman Sachs analyst who was elected to parliament for the first time in 2015, will also need to unite his party in light of the fact that voters are becoming increasingly enraged by the antics of Westminster politicians as the economy heads for recession due to rising energy and food prices.
When Sunak resigned as finance minister in the summer, he was held responsible by many members of the party, inciting a larger revolt that ultimately brought down then-leader Boris Johnson.
While many expressed satisfaction on Monday that the party had rapidly selected a new head, a feeling of mistrust persisted, and others questioned whether poor families could relate to or vote for a multimillionaire.
“I believe this decision will destroy us in the next election,” a Conservative MP told Reuters under the condition of anonymity.
Anthony Seldon, a historian and political biographer, told Reuters that Sunak inherited the most onerous economic and political legacy of any British leader since World War II and would be bound by his predecessor’s errors.
He stated, “There is no room for him to be anything other than extremely careful and conservative.”
After politicians and bureaucrats in foreign capitals witnessed with dismay how a country long considered a pillar of economic and political stability descended into vicious infighting, many viewed Sunak’s appointment as a new beginning.
His selection is also a first for the United Kingdom, since Sunak, a Hindu, becomes the nation’s first prime minister of Indian descent.
US President Joe Biden referred to Sunak’s appointment as a “milestone in history,” as officials from India and worldwide congratulated him on his new position. N.R. Narayana Murthy, his millionaire father-in-law, stated that Sunak will do his best for the people of the United Kingdom.
The creator of software company Infosys stated in a statement, “We are proud of him, and we wish him success.”