Insights

At 5pm on 22nd May 2024, Prime Minister Rishi Sunak announced his intention to call a General Election for 4th July. His decision confounded the expectations of the many pundits and politicians who had predicted an autumn election.

There will be a rush of activity over the coming weeks, with the race starting immediately. Read below for Hawthorn Advisors’ analysis on what to expect and what this means for businesses.

Analysis

In the end, Rishi Sunak took almost everyone by surprise. Just days ago, he laughed when he told the presenters of ITV’s Loose Women that their “summer was safe” – when pushed on a date for the General Election. Looking back on that exchange, he clearly meant “from July 5th onwards…”

The surprise announcement set Westminster abuzz, not least because political journalists live for elections. But what of the reaction elsewhere? Tory MPs, many of whom were banking on an October or November poll, now face the prospect of having their careers and livelihoods cut short by several months, to put it bluntly. The mood among some is said to be mutinous. “This is madness,” says one. Others may be more resigned, while some seem more up for the fight. “Bring it on,” said Rupert Harrison, one of a new breed of Conservative candidates facing an uphill fight in a new parliamentary constituency in Oxfordshire.

As election announcements go, it was inauspicious. Sunak stood at the lectern outside Number 10 and the rain fell. He was almost drowned out by that great New Labour anthem – Things Can Only Get Better, blasted at the gates of Downing Street by one of the resident protestors. And the bible of Conservative politics, The Spectator, had just sent its latest edition to print with a stark leading article concluding: “calling a summer election would be madness for the Tories.” MPs can read it in the coming days as they gear up for the fight of their lives.

As for the speech, Sunak started with what sounded like a long list of excuses, just to remind us: we’ve been through a pandemic, war in Europe, and energy shocks. The subtext was clear—”this mess isn’t my fault.” While his case for the defence was trotted out without any energy or enthusiasm into the microphone: our economy is turning a corner, the world is dangerous, Labour doesn’t have a plan, don’t risk your vote on them.

The Labour leader won’t need to feign his enthusiasm for an election, starting as he is a whopping 20 points ahead in the polls. Those polls may narrow, and the coming six weeks will serve up all the usual daily twists and dramas of election campaigns, but even something in Sunak’s tone of voice – never the most natural – suggested the PM knows the mountain is high and the odds of success are painfully small. It’s a sense you can get in person from cabinet ministers. They will tell you how hard they intend to fight. They are less keen to say that they think they can win. The image of a drenched Prime Minister sloping back into Number 10 may well resonate with voters watching the evening news.

Doubtless, the weather will improve, and doubtless, the long evenings ahead informed the decision to go to the country early, in contrast to the prospects of campaigning for votes in the cold and dark days of Autumn. But the Conservatives will need more than a break in the weather to put a spring in their step. The last time an election was held in July was 1945. The country was emerging from hardship and war, and the country returned a Labour government by a landslide.

What happens now?

There is a 25-day gap between Parliament being dissolved and the date of the election. This is formally the election period, when MPs standing in the election become candidates once again, and government business concludes. For an election to be held on 4th July, Parliament must dissolve on 30 May. For this to happen, the short May recess will be cancelled so that Parliament can wrap up its remaining business.

Before Parliament is dissolved, there will be a legislative ‘wash-up’ period, during which the fate of the remaining Bills that have not yet achieved Royal Assent will be decided. In a departure from the usual process, Bills are expedited through all their remaining stages in a matter of hours. It’s a rare moment when the Opposition has extreme power to agree on what legislation gets nodded through and what gets struck down.

There are 16 Government Bills, 2 Hybrid Bills (a mix of public and private bills), and 10 Commons Private Members’ Bills that have not yet received Royal Assent. The most contentious of which may not be passed, or Labour may negotiate changes to Bills over areas they disagree with. Those with popular crossbench support, such as the Tobacco and Vapes Bill, may yet survive, which Sunak nodded to in his speech.

What can businesses expect?

With just six weeks until polling day, the parties will enter a dash to finalise their manifestos and prepare for the campaign. Regardless of whether a Labour majority is the forgone conclusion that most pollsters predict, Parliament’s makeup will look vastly different in two months’ time. For businesses, now is the time to focus on what a new government of either colour might mean for your industry, and to consider the figures who will be influential in the future of your sector.

We will be posting regular updates during the campaign on policy and politics and how that might affect your business. If you’d like to speak to us about Hawthorn’s Political Advisory offering, please email Mark Burr at m.burr@hawthornadvisors.com.