TheEconomistNovember 28th 2020 491R
ichard holdenis proving expensive.
In the election last December, he be-
came the first Conservative to represent
the seat of North West Durham, a sprawling
constituency of farms and former mining
towns, since it was created in 1950. Since
then he has been promised a new hospital,
and in March won a tax-cut for motor-
homes which will benefit the local camper-
van factory and cost the exchequer £25m a
year over five years. In the spending review
on November 25th, the government said it
would conduct a study into replacing a rail-
way which was shut in 1963. Mr Holden is
also eyeing government funds for a new
bus network, some new footpaths and cy-
cle ways, better broadband and a new lei-
sure centre.
Boris Johnson is keen to please Mr
Holden, for his seat is one of the so-called
“red wall” formerly Labour constituencies
in northern England, the Midlands and
Wales that flipped blue in the general elec-
tion. If people there are to stick with the To-
ries they will need to see their area chang-ing, says Mr Holden. “I want to be able to go
to the next election and say we’ve delivered
this, we’ve had progress on this, and this is
in the pipeline. It’s the fling versus the mar-
riage question—we have to show real com-
mitment to our towns and villages.”
The manifesto on which Mr Johnson
won was written in sunnier times. It bound
together a wide Conservative coalition
with the glue of low borrowing costs and
benign economic conditions. It promised
to “level up” the gap between southern
England and seats such as Mr Holden’s
with a flood of spending on roads and rail-
ways, hospitals and green energy. Yet this
would be done without hiking payroll tax-
es and vat—a red line for Mr Johnson’s ex-
isting stock of southern Tories—and while
cutting the national debt. Britain’s com-
mitment to spend 0.7% of gdpon foreign
aid would stay, despite its unpopularity
with Tory activists, to keep the party’s
dwindling liberal wing happy.
Covid-19 will force Mr Johnson to break
some of those promises, and strain his co-alition. That became clear in the spending
review Rishi Sunak, the chancellor of the
exchequer, announced on November 25th.
The economy, he said, would shrink by
11.3%—the biggest contraction in 300 years.
The spending plans reflect both the de-
mands that the emergency has placed on
the public sector (see chart 1 on next page)
and the government’s political priorities.
A lot of money is being spent on keeping
mps such as Mr Holden happy. The govern-
ment knows that the Labour Party cannot
return to power without winning back
their seats. Those mps are relentless lobby-
ists, organised around a caucus known as
the Northern Research Group. Partly in or-
der to pay for their shopping lists, public
sector net investment will hover just below
3% of gdpin the years after the crisis, high-
er than in all but two years since the 1970s.
The bit of the coalition that was thrown
overboard this week was the shrinking
band of liberals. They were outraged when
Mr Sunak said he would, after all, abandon
Britain’s foreign-aid commitment. David
Cameron, the former prime minister who
enshrined that commitment in law, had
embraced development as part of a “com-
passionate conservatism” agenda. Liz
Sugg, a development minister and former
aide to Mr Cameron, quit.
How much further the coalition is
strained depends largely on the prospects
for recovery. They are highly uncertain. In
its forecasts accompanying the review thePublic spendingA combustible mix
This week’s spending review shows how a combination of covid-19 and Boris
Johnson’s promises are straining public financesBritain
50 Thepotholeproblem
51 Covid-19vaccines
52 Makingfarminggreener
54 Bagehot: Sunak’s secret selfAlso in this section