Rishi Sunak's Whitehall Reset Gives Fresh Focus But Leaves Limited Time To Deliver On His Promises
Sunak has delivered a Whitehall shake-up after Nadhim Zahawi's sacking (Alamy)
Rishi Sunak has undertaken a mini-reshuffle - the fifth in 20 months - as he seeks to set a new path for government following the damage of Nadhim Zahawi's sacking.
Alongside the new postings, Sunak has also grabbed the opportunity to reorder the machinery of Whitehall by creating two new departments for energy security and science innovation and technology, which are being stripped out from the Department for Business, Energy and Industrial Strategy (BEIS), while the trade brief is being brought back in to form a new Department for Business and Trade.
The new Department for Science, Innovation and Technology will also take on the current digital work being undertaken at the former Department for Digital, Culture, Media and Sport, as Sunak attempts to cement his focus on his five priorities, including halving inflation and growing the economy.
The shake-up goes further than many in Westminster expected, and appears to vindicate critics who warned that folding the then-department of energy into the business brief seven years ago was an oversight, with shadow climate change minister Ed Miliband saying on Tuesday the "disastrous decision" had contributed to the cost of living crisis while delivering record profits to oil and gas firms.
While the decision is largely unsurprising given that Sunak had floated the idea during his summer leadership bid, the renewed focus on energy security and the decision to shuffle Grant Shapps from his senior Business Secretary role to head the department is likely to prove popular with Tory backbenchers who increasingly view the energy bill crisis as a looming electoral disaster.
The similar decision to focus on science and innovation is again unlikely to come as a shock given Sunak's reputation as a 'tech-bro' who spent time in Silicon Valley while living in California, but is equally predicted to be celebrated by his own party who have lamented the significant drop in tech investment to the UK in 2022.
While junior ministerial roles are still to be fully announced, George Freeman has confirmed he will retain his science brief in the new department – a decision which has come as a surprise to some Westminster watchers who believed his long-standing passion for the sector may have appealed to Sunak’s more technocratic approach to ministerial appointments. Instead the department will be led by Michelle Donelan, who takes up the role after being moved from her current post as DCMS Secretary, with housing minister Lucy Fraser getting a promotion to replace Donelan as the new Culture Secretary.
Sunak's former role as chancellor could also have played a significant role in his decision to fillet BEIS after he clashed last year with then-Business Secretary Kwasi Kwarteng over various aspects of the government's response to the spiralling energy crisis. Writing for The House, Tom Sasse, associate director at the Institute for Government, said the spat between the pair was less about personalities, and instead reflected a historic friction between the two departments which often find themselves at odds over how the economy should be managed.
The "constant tinkering" with the department, Sasse argued, reflected an inability to find a "settled role" for the department which frequently advocates for more interventionist approaches in the face of Treasury orthodoxy. It means Sunak's latest move will inevitably raise questions about his motivations and whether they were driven by genuine attempts to improve governmental decision-making, or instead further strengthening the power of the Treasury to set economic strategy.
This wider departmental shake-up was prompted by his decision to sack Nadhim Zahawi as Conservative Party chair, a role which has now been filled by Greg Hands, an MP with a wealth of ministerial experience, who now faces the unenviable task of preparing the party machine for crucial local elections in May, which many pollsters predict could deliver a bloodbath in several Tory heartlands.
But while the former deputy chief whip is regarded in Westminster as a safe pair of hands and a savvy media performer, one Tory campaigner told PoliticsHome they expected a "shake up" in how campaigns will be run going forward.
"He's not afraid to take risks. We approached him with a pretty unconventional online campaign idea that our local MP had rejected and he let us run with it. I think he took some flak from the party for going off script, but he was willing to give it a go," they said.
"The local elections are probably too close to do anything major, but given our current trajectory I think he will want to shake up the campaign strategy before the [general election] because he knows we've got to modernise to have any chance to limit the damage."
But while Downing Street have talked up the reorganisation as an opportunity for Sunak to better deliver his New Year pledges, there are few who believe the Whitehall re-jig will be achieved in time for the PM to make significant headway before the next general election expected to be held in Spring 2024.
According to the Institute for Government, each new government department established by Sunak will cost an initial £15m to launch, with staff uncertainty and the creation of new interdepartmental working practices adding to further delays. Practical changes alone, they claim, such as setting up new IT and HR arrangements will take until early 2025 before they become fully operational.
Those difficulties will be further compounded by the carousel of ministers who have moved through government in the past several years, with Kemi Badenoch's move to the new Business and Trade department making her the sixth secretary responsible for business since the 2019 election, while Lucy Frazer's elevation to cabinet means the housing brief is empty for the sixth time time in just 12 months. Rebuilding those relationships with sectors and stakeholders and setting new departmental directions all take time, which Sunak’s party are quickly running out of.
While today’s reset might provide Sunak with some breathing space to again focus on his priorities after the scandal of Zahawi’s sacking dominated headlines, the threats still loom large for the Prime Minister who now faces increasing pressure around the investigation into Dominic Raab’s bullying claims which risk creating further turbulence at the top of government.
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