Liz Truss to make major UK government changes if she becomes PM


Thomas Harding
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Britain will be governed by a tranche of new figures if Liz Truss becomes the new prime minister, The National can disclose.

Up to nine leading Cabinet members who are Rishi Sunak supporters will likely be out of government when, as expected, Ms Truss wins the Conservative Party leadership contest on Monday.

The three top posts will almost certainly go to Kwasi Kwarteng as chancellor, James Cleverly as foreign secretary and Suella Braverman as home secretary.

Several new faces will also appear in the 28 or so ministers who sit around Downing Street’s Cabinet table deciding how to govern Britain.

Ministers from almost every department will soon be involved in tackling the energy crisis that will dominate the early months of a likely Truss premiership.

Candidates who took part in the early rounds of the leadership race, such as Penny Mordaunt, Tom Tugendhat and Kemi Badenoch, are likely to be rewarded with government posts.

To avoid the in-fighting that cost Boris Johnson his job and to restore the Conservatives' reputation, Ms Truss is likely to carefully choose ministers from across several factions for a more united government.

Chancellor

With Britain on the cusp of severe economic challenges, the Treasury will be under immense pressure to provide some form of relief to households facing annual energy bills that will soon exceed £3,500 ($4,100).

That task will likely fall to Mr Kwarteng, who will be promoted from Business Secretary to Chancellor of the Exchequer, the second most important job in government.

As a result, the Treasury will be fully economically aligned with Downing Street, with both Mr Kwarteng and Ms Truss strong free marketeers. This was expressed in the book Britannia Unchained they co-authored in 2012 to argue for lower taxes and less regulation. Mr Kwarteng also shares Ms Truss’ circumspection of windfall taxes on energy firms.

Mr Kwarteng, whose parents were migrants from Ghana, is well regarded as a highly intelligent operator. He won a King's Scholarship to the renowned UK school Eton and then achieved a first-class degree at Cambridge University.

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Those intellectual attributes will undergo a forensic examination through an emergency budget expected in the autumn.

In that, he will likely be assisted by John Redwood, who could make an astonishing return to government after 27 years on the back benches. He is set to become either economic secretary or financial secretary to the Treasury, the number three in the department.

They could well be joined by right-wing loyalist Jacob Rees-Mogg, currently the minister for Brexit opportunities, as Chief Secretary to the Treasury, second to the Chancellor.

Foreign Office

With Ms Truss vacating her post as Foreign Secretary, it is understood that her replacement will be former Middle East minister James Cleverly, who served as her deputy in the department.

She is known to rate Mr Cleverly highly, having seen his work as Minister for State for Europe. This included a leading role dealing with the Ukraine war, following his promotion from the Middle East post last year.

He is acutely aware of the Russia aggression that will probably be his main focus for at least the next year. But his Middle East experience will also give him good grounds to focus on a trade deal with GCC countries.

Mr Cleverly, who will also oversee MI6 as Foreign Secretary, brings solid military experience to the post. He served in the army reserves for 20 years and attained the rank of lieutenant colonel.

Another politician with military experience likely to join him is Mr Tugendhat. He is tipped to become a minister in the Foreign Office, with his time as chairman of the foreign affairs committee giving him an excellent insight into Britain’s overseas challenges.

Mr Tugendhat came fifth in the parliamentary poll, giving him greater public prominence. Some commentators also said he performed well in the television debates, suggesting that a senior Cabinet post could materialise if he proves competent in his first government post.

He is from the “One Nation’ Tories, on the more liberal wing of the party, that will allow Ms Truss to have greater appeal among her MPs. There is also a suggestion he could receive the Security Minister post in the Home Office.

Home Office

Famous for being the graveyard of many politicians, the Home Office will almost certainly have a new chief with Suella Braverman taking over from Priti Patel.

As Attorney General, Ms Braverman will be well versed in the legal details that the new prime minister will hope enable her to overcome the continued illegal immigrant issue.

Ms Braverman, the daughter of Kenyan and Mauritian immigrants, will have to deal with the derailed policy of deporting failed asylum seekers to Rwanda.

As Attorney General, Ms Braverman will be well versed in the legal details that the new prime minister will hope enable her to overcome the continued illegal immigrant issue. PA
As Attorney General, Ms Braverman will be well versed in the legal details that the new prime minister will hope enable her to overcome the continued illegal immigrant issue. PA

Her success will also be measured on whether that policy and any others she introduces clamps down on the number of migrants making the small boat crossings of the English Channel.

An ardent Brexiteer, Ms Braverman carries support among right-wingers and came a respectable sixth in the leadership contest before giving her full support to Ms Truss.

The Home Office is also likely to see a number of new faces who the new PM will want to assess to see if they are able to handle challenging portfolios.

Defence

One question that will never now be answered is that if Ben Wallace had decided to enter the leadership contest, would he have become prime minister on Tuesday?

In July, he led the polls among the Tory membership but instead chose to concentrate on the task of combating Russia in Ukraine as Defence Secretary, rather than deserting his post in pursuit of power.

That cemented the former soldier’s reputation for devotion to Britain’s security and will ensure that he almost certainly remains in his current post. He could even be further rewarded with the additional post of deputy prime minister, a position that has proven transferable among Cabinet ministers.

British Defence Secretary Ben Wallace speaks after co-hosting a donor conference at Christiansborg in Copenhagen. AFP
British Defence Secretary Ben Wallace speaks after co-hosting a donor conference at Christiansborg in Copenhagen. AFP

While a strong Mr Johnson loyalist, Mr Wallace shares Ms Truss’ antipathy for Russia and her desire to increase defence spending to 3 per cent of GDP.

He could well be joined in the Ministry of Defence by former defence secretary Penny Mordaunt, who just missed out to Ms Truss in reaching the final pair in the leadership contest.

Currently a trade minister, Ms Mordaunt could be given a role as Mr Wallace’s deputy or another senior security post in Cabinet.

Incoming

Integral to any prime minister’s success is the ability of the ministers they appoint to undertake government work.

Ms Truss values competence highly and on that basis, is likely to promote Ms Badenoch, the daughter of Nigerian parents who proved so formidable during the leadership contest and could be given either transport or education.

Ms Truss’ friend and arch loyalist Therese Coffey is set to be given the task of restoring the heavily frayed internal discipline as Chief Whip.

Kemi Badenoch taking part in Britain's Next Prime Minister: The ITV Debate, a head-to-head debate between Conservative Party leadership candidates in July. PA
Kemi Badenoch taking part in Britain's Next Prime Minister: The ITV Debate, a head-to-head debate between Conservative Party leadership candidates in July. PA

Former party leader Sir Iain Duncan Smith is another veteran certain to be given a weighty role along with Lord David Frost, the former chief Brexit negotiator.

Nadhim Zahawi’s brief tenure as chancellor will end with him possibly being given the health secretary post.

Nadine Dorries, a fervent Boris Johnson supporter, will probably remain as chief BBC-basher as culture secretary, although could move to the Lords.

Other new faces in Cabinet are likely to be Ranil Jayawardena, Chloe Smith and Simon Clarke.

Outgoing

Victory for Ms Truss will mean defeat for Mr Sunak and his many senior government supporters who know that there will be no place for them in her government.

Michael Gove has already said he is leaving frontline politics while the fate of hardline Home Secretary Priti Patel is also likely to be confirmed. They will likely be joined by Deputy Prime Minister Dominic Raab, George Eustice, Steve Barclay, Mark Spencer and Johnny Mercer.

Ms Truss will hope that they chose to avoid the plotting that undid Mr Johnson and allow her to lead both a united party through one of Britain’s most challenging periods.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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Safety 'top priority' for rival hyperloop company

The chief operating officer of Hyperloop Transportation Technologies, Andres de Leon, said his company's hyperloop technology is “ready” and safe.

He said the company prioritised safety throughout its development and, last year, Munich Re, one of the world's largest reinsurance companies, announced it was ready to insure their technology.

“Our levitation, propulsion, and vacuum technology have all been developed [...] over several decades and have been deployed and tested at full scale,” he said in a statement to The National.

“Only once the system has been certified and approved will it move people,” he said.

HyperloopTT has begun designing and engineering processes for its Abu Dhabi projects and hopes to break ground soon. 

With no delivery date yet announced, Mr de Leon said timelines had to be considered carefully, as government approval, permits, and regulations could create necessary delays.

Updated: August 31, 2022, 6:00 AM