10 2GM Saturday September 5 2020 | the times
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Putting the boot in Ania Hobson, a recent BP Portrait Awards young artist winner, with Two Moods and Dr Martens at her first London solo exhibition, at the Catto Gallery in Hampstead until September 23
Boris Johnson has suggested to Tory
MPs that London could be given a
partial exemption from new planning
laws as he seeks to placate opponents.
The prime minister is understood to
have said that the city could be offered
a “carve-out” from some measures
after warnings that the reforms risked
“destroying suburbia”.
Mr Johnson had suggested the capi-
tal could be exempted from the new
measures that will allow people to build
two-storey extensions without full
planning permission.
Downing Street sources denied that
any explicit offer of a “carve-out” had
been made but acknowledged there
had been a discussion around the issue.
In a Zoom call 17 Tory MPs, including
four ministers, raised concerns about
the reforms under which the number of
homes built in London could nearly
treble to 93,532. However, any conces-
sion for London will increase calls from
those who represent the shires to be
given a similar exemption.
“The feedback from Tory MPs across
the country is overwhelmingly nega-
tive,” one MP said. “It feels inevitable
we will get a U-turn on this. There’s no
way people will vote for it.”
Shaun Bailey, the Conservative can-
didate to become the next mayor of
London, said: “London works because
the suburbs work. If we destroy that we
are creating overcrowding of the future
and we’re making family life in London
impossible. The current algorithm is
too clinical. It doesn’t take into account
the flow of human growth or family
life.”
Under the changes to planning laws,
local discretion over the rate of house-
building will be removed and central
government will “distribute” an annual
target, at present 337,000 a year, among
councils. They will then be required to
designate enough land.
Lichfields, a planning consultancy,
said that much of the new housing will
be concentrated in Conservative
council areas in suburbs and shires.
A government source said: “This is
not something we’re going to step away
from. We’ve got a duty to do this for the
next generation.”ELLIOTT FRANKSWarnings from a whitewashed room
as Cummings launches new mission
ters, sound finances don’t matter —
then they would have voted Labour at
the last election. But they didn’t. So it is
important we set up that distinction,
you can’t just show up three months
before the next election and say this
stuff is important. You’ve got to prove
it.”
Mr Johnson warned the new intake
that things were going to get worse
before they got better — widely inter-
preted as an acknowledgement that the
budget would be politically painful.
Mr Sunak is said to be determined
that the budget proves to the markets
that he is prepared to set public finan-
ces on a course towards sustainability.
Downing Street sources said that Mr
Johnson and Mr Sunak were in “lock
step” over plans for the budget. The ve-
hemence of the response to some of the
proposals caught Mr Sunak off guard,
however. Rises to fuel duty are now al-
most out of the question. He is sympa-
thetic, also, to the argument that faced
with Brexit uncertainty a rise in corpo-
ration tax may be best postponed.
Meanwhile, Mr Cummings presses
ahead with his rewiring efforts behind a
bank of desks that includes his data su-
premo, Ben Warner, and officials.
The key figure apart from Mr Cum-
mings is Munira Mirza, the head of the
policy unit. Also in the room is the
prime minister’s implementation unit
and the No 10 legislation team.
Insiders say that Mr Johnson prefers
to remain in No 10, along with Martin
Reynolds, his principal private secre-
tary. Lord Frost’s Brexit unit has not
moved to mission control, nor has Mr
Sunak’s team. Sir Ed Lister, the chief
strategic adviser, is also absent.
“It’s like a sort of data boy’s frat
house,” one official said after visiting
Room 38. “Dom sits there with the
people he thinks are clever enough to
be there. It’s like that film about Face-
book, The Social Network. You know,
where they sit around in a Harvard
dorm trying to build some software.
Except they’re trying to run a country.”
Simon Case, the new cabinet secre-
tary, retains an office almost equidis-
tant from both power centres.
Matt Chorley, page 33
My Week, page 40
Sunak’s tax question, pages 50-ple lock. Under the mechanism, the
state pension rises in line with wages,
inflation or 2.5 per cent, whichever is
higher.
Mr Sunak is understood to be push-
ing for the lock to be suspended next
year to ditch the 2.5 per cent element.
This would save the Treasury £2 bil-
lion a year and avoid a significant rise in
state pensions at a time when wages are
expected to stagnate. Mr Johnson is
said to hate the idea of abandoning a
manifesto pledge.
Of the tax rises under consideration,
the Treasury is understood to believe
that pensions tax relief is the most ripe
for reform. Higher earners now get tax
relief at their marginal rate of 40 per
cent when making pensions contribu-
tions, while lower earners have relief of
just 20 per cent. “It’s inherently unfair,”
one Treasury source said. “Why should
the rich get such a huge benefit com-
pared to those on lower earnings?”
Mr Sunak is understood to be consid-
ering introducing a flat rate of relief for
all saving into their pensions. Sajid
Javid, Mr Sunak’s predecessor, consid-
ered adopting a flat rate of 30 per cent.
The move would provide a boost to low-
er earners saving into their pensions
while cutting relief for higher earners.
Treasury modelling suggests that it
would save the government £3 billion to
£4 billion. Mr Sunak is considering a flat
rate of tax relief of 20 per cent, saving
about £10 billion a year. While the sav-
ings may be significant, introducing the
measures would be complex and re-
quire Revenue & Customs to devise a
new system, taking up to five years to
implement. Whatever the private ten-
sions, the prime minister and chancel-
lor stood together as they ad-
dressed MPs on Wednesday. “If
we don’t approach the next
election with there being
some clear blue water on
spending, borrowing and
of course, tax, then we will
have removed one of the
most important reasons
that people vote Conserv-
ative,” Mr Sunak told a
meeting of last year’s in-
take of Tory MPs. “If that’s
what the British people believe
in — that none of this stuff mat-to capital gains tax, corporation tax,
fuel duty and national insurance con-
tributions for the self-employed. Cuts
to pension tax relief for high earners are
being mooted along with a simplifica-
tion of inheritance tax rules.
In normal times, any one of the tax
changes would be deemed politically
toxic, as previous chancellors such as
George Osborne found to their cost.
Without context or other explana-
tions many, if not all, of the rises looked
unappealing, including to Mr Johnson.
The extent to which the prime minister
is prepared to increase taxes in the bud-
get this autumn remains unclear but
some of his cabinet believe that he is
determined to resist his chancellor.
“It’s not going to happen,” one senior
ally said. “It’s the wrong solution. It goes
against fundamental Tory principles.
It’s not what Downing Street wants to
do. The prime minister is not into it at
all. This is a Treasury position, not a
No 10 position. These briefings are all
about softening up No 10.”
Details of the Treasury’s proposals
infuriated some cabinet ministers.
“If you raise taxes at this stage you
will choke off the economic growth that
will pay off the debt in the long term,”
one said. “There’s no support for this on
the back benches. If we wanted Jeremy
Corbyn and his tax rises we would have
voted for him. We didn’t.”
Alok Sharma, the business secretary,
and Oliver Dowden, the culture secre-
tary, are said to be more accepting of the
idea of tax rises. One cabinet minister
said: “The issue will be that
because Boris is not Mr Aus-
terity, where are we going to
get the money? I’d be abso-
lutely against direct tax rises
but we do have to look at indi-
rect taxes. At the moment
we’re addicted to the low
cost of borrowing and it
looks like that is going to
continue for some time.”
There is a continuing
debate around the Tory
manifesto pledges, par-
ticularly the pensions tri-Dominic Cummings, addressing staff
gathered in “mission control” on Tues-
day morning, was blunt about the moti-
vation behind Downing Street’s new
outpost in the heart of the Cabinet
Office.
The response to the Covid-19 crisis
had too often been a “shitshow”, he said.
This new unit would try to put an end to
any “miscommunication” between the
political and administrative arms of
government.
In roughly equal numbers, political
aides and civil servants stood in the
whitewashed room with rows of desks
and TV screens to listen to his version
of the future.
After Mr Cummings had finished,
Boris Johnson spoke briefly. He joked at
one point that the “mission control
centre” reminded him of a newsroom.
Other inhabitants of Room 38, 70
Whitehall, had a different take. Some
thought the atmospherics were more
Ricky Gervais’s The Office than Nasa.
The screens, which in time will dis-
play data-tracking progress against key
challenges such as coronavirus, were
showing a Powerpoint presentation of
government priorities.
Further down Whitehall in the Trea-
sury, one metric above all is flashing red
— Britain’s ever-growing mountain of
debt. Government borrowing has
ballooned over the past few months to
pay for an additional £190 billion
spending since March.
While millions of diners were Eating
Out to Help Out last month, the man
picking up some of the bill was wonder-
ing how to pay. Rishi Sunak, the chan-
cellor, commissioned work on a slew of
tax rises but he and his team were
aghast to see their deliberations
splashed across the newspapers as MPs
were about to return to parliament.
Seven major tax rises were modelled
over the summer, including increases
PM’s aide aims to take
back control of No 10’s
messages, write Francis
Elliott, Steven Swinford
and Ross Kempsell
London could
avoid parts of
planning law
Steven Swinford Deputy Political Editor
Dominic Cummings
is in Room 38 trying
to rewire No 10