Rishi Sunak served as Chancellor of the Exchequer of the United Kingdom from his appointment on 13 February 2020 to his resignation on 5 July 2022. His tenure was dominated by the COVID-19 pandemic in the United Kingdom, with Sunak becoming a prominent figure in the government's response to the pandemic, giving economic support to struggling businesses through various schemes. He was also involved in the government's response to the cost of living crisis, UK energy supply crisis, and global energy crisis.
Sunak was appointed chancellor by prime minister Boris Johnson in the 2020 cabinet reshuffle, succeeding Sajid Javid, who had resigned as chancellor after refusing a demand from Johnson and his chief adviser Dominic Cummings that he dismiss his advisers. Sunak was prominent in the government's financial response to the COVID-19 pandemic and its economic impact, including the Coronavirus Job Retention furlough scheme for employees, and the Eat Out to Help Out scheme, although the latter of which contributed to a rise in COVID-19 infections. Controversies regarding COVID-19 contracts occurred during Sunak's chancellorship. In the Partygate scandal it was found that multiple parties had been held at 10 Downing Street during national COVID-19 lockdowns, and COVID-19 social distancing laws were breached by 83 individuals, including Sunak, who in April 2022 was issued with a fixed penalty notice.
In May 2022, as the rising cost of living became an increasingly serious and worrying issue for the country, Sunak intensified the government's efforts to respond to the crisis, with a £5 billion windfall tax on energy companies to help fund a £15 billion support package for the public. Following the Chris Pincher scandal, Sunak resigned as chancellor on 5 July 2022, almost simultaneously with Javid's resignation as health secretary, and was the second of 62 Conservative MPs to resign during the government crisis which culminated in Johnson's own resignation. He was succeeded by Nadhim Zahawi. Three months after the end of his chancellorship, Sunak became prime minister following the resignation of Liz Truss in October 2022 amid another government crisis, having spent the duration of Truss's premiership on the backbenches.
Appointment
Background Rishi Sunak was appointed Chief Secretary to the Treasury by Prime Minister Boris Johnson on 24 July 2019, and Sajid Javid was appointed Chancellor of the Exchequer. Tensions between 10 Downing Street and the Treasury had come to a head in August 2019, when Johnson's Chief Special Adviser Dominic Cummings dismissed one of Javid's aides, Sonia Khan, without Javid's permission and without informing him. It was alleged that, during her dismissal, Cummings "went outside No 10 and asked an armed officer to enter the building and escort Khan off the premises." In November 2019, following questions of a rift between the two men, Johnson gave his assurance that he would retain Javid as chancellor after the 2019 general election. After the Conservative Party's landslide victory at the 2019 general election, Javid remained as chancellor and Sunak remained as Chief Secretary to the Treasury.
Appointment as Chancellor
In the weeks leading up to Johnson's first cabinet reshuffle in February 2020, a number of briefings in the press had suggested that a new economic ministry led by Sunak might be established, to reduce the power and political influence of the Treasury. Sunak was considered to be a Johnson loyalist, seen as the "rising star" minister who had ably represented Johnson during the 2019 general election debates. By February 2020, it was reported that Javid would remain in his role as Chancellor and that Sunak would stay on as Chief Secretary to the Treasury, in order to "keep an eye" on Javid.
On 13 February 2020, the day of the reshuffle, Javid resigned as Chancellor of the Exchequer, following a meeting with Johnson. During the meeting, Johnson had offered to allow Javid to keep his position on the condition that he dismiss all his advisers at the Treasury and replace them with ones selected by 10 Downing Street. Upon resigning, Javid told the Press Association that "no self-respecting minister would accept those terms". Javid's resignation had been unexpected, given Johnson's commitment to keep him in the Cabinet and recent reports that a rival finance ministry would not be created.
Sunak was promoted to chancellor to replace Javid as part of Johnson's first cabinet reshuffle later that day. Some political commentators saw Sunak's appointment as signalling the end of the Treasury's independence from Downing Street, which began during Gordon Brown's chancellorship under Tony Blair, with Robert Shrimsley, chief political commentator of the Financial Times, arguing that "good government often depends on senior ministers – and the Chancellor in particular – being able to fight bad ideas".
Major acts as Chancellor
COVID-19 pandemic
In response to the first confirmed COVID-19 cases in January 2020, Sunak and the government introduced advice for travellers coming from affected countries in late January and February 2020, and began contact tracing, although this was later abandoned. The government incrementally introduced further societal restrictions on the public as the virus spread across the country in the following weeks, initially resisting more stringent measures introduced elsewhere in Europe and Asia. On 23 March 2020, as COVID-19 had become a pandemic and began rapidly spreading across the country, Johnson announced the first national lockdown and Parliament introduced the Coronavirus Act 2020, which granted the devolved governments emergency powers and empowered the police to enforce public health measures. Sunak was part of a committee of Cabinet ministers that made decisions on the pandemic.
On 20 March 2020, Sunak gave a statement on COVID-19, saying:
As the governments began lifting the nationwide stay-at-home order, policies and approaches diverged between the four nations. The Scottish government uniquely pursued an elimination strategy. Across the country, localised lockdowns, social distancing measures, self-isolation laws for those exposed to the virus and rules on face masks were introduced, as well as efforts to expand COVID-19 testing and tracing. In autumn and winter 2020, further nationwide lockdowns were introduced in response to a surge in COVID-19 cases and the Alpha variant. A COVID-19 vaccination programme began in December 2020. In mid-2021, the government lifted most restrictions during the third wave driven by the Delta variant, until the "winter plan" reintroduced some rules in response to the Omicron variant in December that year. Remaining restrictions were lifted in England from 24 February 2022 under a "living with COVID" plan announced by the government on that date. Economic support was provided to struggling businesses and to furlough employees to mitigate the severe economic impact. It also forwent the procurement process in contracts in response to shortages of PPE and medical equipment, major issues in the early months of the outbreak, and for developing a contact tracing app.
As the pandemic generated financial consequences, Sunak's measures as chancellor received criticism as some workers were unable to qualify for the Treasury's income support measures. The Institute for Employment Studies estimated that 100,000 people could not be eligible for any type of government help as they started a new job too late to be included on the job retention scheme, while the British Hospitality Association informed the Treasury Select Committee that between 350,000 and 500,000 workers in its sector were not eligible. On 26 September 2020, Sunak was said to have opposed a second lockdown with the threat of his resignation, due to what he saw as the dire economic consequences it would have and the responsibility he would have to suffer for that. The UK government's response to the pandemic, in particular the timeliness of public health measures being introduced and lifted, has faced criticism from academic medical sources, media outlets, relatives of COVID-19 patients and various political figures. A public inquiry into the response began in 2022.
Sunak said he had opposed recommendations by government medical advisers for a second "circuit-breaker" lockdown in September 2020 due to the potential impact on jobs and the economy. Then–health secretary Matt Hancock said that Sunak had put Johnson under "enormous pressure" not to introduce further restrictions during this time although Sunak maintained he had only advised the Prime Minister on economic matters in order to help him reach a decision. According to the diary of Vallance, he was told by Dominic Cummings, Johnson's chief political adviser, that Sunak had argued to "just let people die" during an argument over imposing a second lockdown in October 2020. Sunak denied the "let people die" claim, pointing to the fact that Vallance did not hear the phrase but merely claimed to have been told about it by Cummings.
COVID-19 schemes
Coronavirus Job Retention Scheme
On 17 March 2020, Sunak introduced a programme providing £330 billion in emergency support for businesses, as well as a furlough scheme for employees. This was the first time a British government had created such an employee retention scheme. The scheme was introduced on 20 March 2020 as providing grants to employers to pay 80% of a staff wage and employment costs each month, up to a total of £2,500 per person per month. The cost has been estimated at £14 billion a month to run. The Coronavirus Job Retention Scheme initially ran for three months and was backdated to 1 March. Following a three-week extension of the countrywide lockdown the scheme was extended by Sunak until the end of June 2020. At the end of May, Sunak extended the scheme until the end of October 2020. The decision to extend the job retention scheme was made to avoid or defer mass redundancies, company bankruptcies and potential unemployment levels not seen since the 1930s. After a second lockdown in England on 31 October 2020, the programme was further extended until 2 December 2020, this was followed on 5 November 2020 by a lengthy extension until 31 March 2021. On 17 December 2020, the programme was further extended until 30 April 2021. In the 2021 budget held on 3 March 2021, Sunak confirmed that the scheme had been extended once more until 30 September 2021.Following changes to the scheme at the end of May, the director of the Northern Ireland Retail Consortium said that being asked to pay wages when businesses had not been trading was an added pressure, while the Federation of Small Businesses was surprised that the Chancellor was tapering the scheme when ending it. Northern Ireland's economy minister Diane Dodds said that changes to the scheme could be very difficult for some sectors uncertain about when they can reopen, particularly in the hospitality and retail sector, whilst finance minister Conor Murphy said that it was too early in the economic recovery. By 15 August 80,433 firms had returned £215,756,121 that had been claimed under the scheme. Other companies had claimed smaller amounts of grant cash on the next instalment to compensate for any overpayment. HM Revenue and Customs officials believed that £3.5 billion may have been paid out in error or to fraudsters.
Eat Out to Help Out