The biggest winners and losers in 2021 – and what to look out for in the autumn

With parliament on summer recess, Institute for Government researchers have looked back on the past eight months to ask who the biggest winners and losers were. We also look forward to the big issues that will define the government’s autumn.

Civil service and ministers

Biggest winner

Everyone involved in the vaccination programme has a strong claim to be a winner; politically, Boris Johnson and vaccines minister Nadhim Zahawi have benefited from its success. The biggest ministerial comeback belonged to Sajid Javid, back in the Cabinet, as health secretary, after nearly 18 months on the backbenches.

Biggest loser

The highest profile departure from the cabinet was that of Matt Hancock, with his exit coming after one of the toughest shifts of any health minister in recent history.   

What to look out for in the autumn

The tone of the rest of the year in government will depend on whether the pandemic starts to recede. Even with less focus on Covid, tight pay settlements and a sometimes awkward readjustment to a post-lockdown world could cause problems for ministers. The return to working in offices and dealing with ‘hybrid’ teams might again lead to tensions between ministers and civil servants.

Issues the government has been able to sidestep because of Covid will come to the fore as politics unfreezes. Rows about social care, planning reform, the cladding scandal, Universal Credit and what “levelling up” does or does not mean will erupt and the government will invest huge political capital trying to get an international agreement on climate change at the COP26 meeting in Glasgow this November. The omens for that do not currently look good, but Johnson and his government will be hoping for international success to take the pressure off difficulties at home.

Parliament

Biggest winner

The extension of the right to a proxy vote to all MPs – made after the government abolished the Commons secure online voting app – has given the party whips control over the votes of hundreds of members, making them the winners of 2021 so far. On the last sitting day before Easter, 595 of 650 MPs had exercised their right to a proxy, with their votes being cast on their behalf by just 18 members. Proxies have to vote in line with instructions from the relevant MP, but the effect has been to make the party whips more powerful. While the whips may relish their new found control, the mass use of proxies – with MPs deciding in advance of a debate which way to vote – undermines the significance of debate and provides a serious disincentive to rebellions.

Biggest loser

Part of the government’s justification for delaying the start of the public inquiry into its handling of the Covid-19 pandemic until spring 2022 was that in the meantime scrutiny would be conducted by parliament, the National Audit Office and other bodies. But MPs and peers have expressed frustration at the government’s failure to engage with their inquiries. Most recently, the Lords Covid-19 Committee has publicly criticised the government’s response to one of its reports, and the Procedure Committee has expressed concern about a decline in the timeliness of responses to parliamentary questions. Throughout the year backbenchers and opposition parties have bemoaned the side-lining of parliament during the pandemic.

What to look out for in the autumn

The return to in-person proceedings from September – which parliament experienced for the first time in 18 months with the August emergency recall to debate the Afghanistan crisis – will present the government and opposition with new challenges. Boris Johnson and Keir Starmer will face off at Prime Minister’s Questions in front of a full chamber and party whips will be watching to see what difference being in Westminster makes to the propensity of their members to rebel against the party line. MPs who entered parliament at the 2019 election, and those elected in by-elections since, will have to get used to operating in Westminster, and members of both Houses will need to reflect on which of the procedural innovations forced by the pandemic are worth retaining in future – the ability for select committees to meet remotely should be a strong contender.

Brexit

Biggest winner

It is still too soon to determine the long term winners and losers from the UK’s departure from the EU, but during the Brexit process the European Research Group (ERG), comprising hardline euro-sceptic Conservative backbenchers, exerted significant influence over the kind of Brexit the UK government pursued. Its steadfast opposition to Theresa May’s deal contributed to her resignation in June 2019 and the complete change in the government’s approach under Boris Johnson. It has also inspired other backbench groups – including the Covid Recovery Group.

Biggest loser

The Democratic Unionist Party (DUP) was among the biggest losers of the Brexit process. Despite securing an influential position as May’s ‘confidence and supply’ partners in 2017, the party overplayed their hand by then rejecting her deal. This helped pave the way for May’s resignation and Johnson’s renegotiation of the Brexit deal – which included the Northern Ireland protocol the DUP so strongly opposes.

The DUP has paid a heavy political price for this mishandling of Brexit. Many in Northern Ireland’s unionist community blame the party for the protocol, which could lead to a realignment of support for unionist parties in Northern Ireland; a recent survey of voters from across the political spectrum in Northern Ireland found that 78% of respondents did not trust the DUP to protect Northern Ireland’s interest on the protocol.^[1]

What to look out for in the autumn

The Northern Ireland protocol will be the major flashpoint in the autumn. The protocol, designed to avoid a hard border on the island of Ireland, creates a customs and regulatory border between Great Britain and Northern Ireland by keeping Northern Ireland aligned with many EU rules on goods. ‘Grace periods’ have delayed the full impact of new checks but are due to expire at the end of September. Some businesses have warned this could lead to significant disruption to trade across the Irish Sea.^[2] Although both the UK and EU recognise that the protocol could have severe implications, they cannot agree how to resolve the key areas of disagreement. The UK government’s recent proposal to renegotiate large parts of the protocol has been rejected by the EU, although the European Commission has frozen its current legal proceedings against the UK, which will help create political space for discussions.

If the UK and EU do not make the necessary compromises to reach a viable long-term solution, the UK could act unilaterally by triggering Article 16 of the protocol on the basis that the protocol is causing “serious economic, societal or environmental difficulties that are liable to persist, or to diversion of trade”. This, though, would be a controversial move and damage UK–EU relations. In the meantime, businesses and individuals in Northern Ireland will continue to suffer from ongoing uncertainty and heightened political tensions.

1. Phinnemore D, Hayward K, Whitten L and Melo Araujo B, Testing The Temperature 2, What Do Voters In Northern Ireland Think About The Protocol On Ireland/Northern Ireland?, Queen's University Belfast, June 2021, www.qub.ac.uk/sites/post-brexit-governance-ni/ProjectPublications/OpinionPolling/TestingTheTemperature2/
2. Mason R and O'Carroll, L, M&S plans to delist Christmas products from NI stores, Irish Times, 21 July 2021, www.irishtimes.com/business/retail-and-services/m-s-plans-to-delist-christmas-products-from-ni-stores-1.4626606

Public finances

Biggest winner

Events move on so quickly that it is easy to forget where the economy was, and what economists expected, just a few months ago. The recovery in 2021 has been far quicker than expected: fewer than two million workers are on furlough and forecasters have substantially improved their outlook for growth over the next few years. Everyone wins from a better economic recovery, but the winner of 2021 so far is the Treasury. You might expect that recovery to have translated into demands for more government spending, but the Treasury has successfully rebuffed calls to reverse controversial cuts to overseas aid spending and made the NHS find the money for a pay rise out of its own budget. Rishi Sunak will see both as clear wins for his department.

Biggest loser

Unfortunately, the recovery has not been evenly spread across the country. In particular, employees are much more likely to be furloughed in London than elsewhere in the country, and the capital’s recovery is lagging behind. And while it is still far from clear what ‘levelling up’ means exactly, the prime minister, with one eye firmly on the former ‘red wall’, has been quite clear that it does not include policies to support London. While this year may well be a temporary blip for the nation’s biggest and most prosperous city, London appears to be the loser of 2021 so far.

What to look out for in the autumn

This autumn will be one of the most important for the UK public finances in several years. The chancellor is expected to announce his new fiscal rules, which will constrain government borrowing over the next few years. We will also get new (hopefully improved) forecasts from the Office for Budget Responsibility that will set the stage for a series of difficult fiscal decisions the government will need to make. As well as the big one – the multi-year spending review – there is the temporary uplift to Universal Credit which is due to expire at the end of September and a promise to unveil a plan for social care, and how to pay for it. These questions are likely to result in tussles between No.10 and No.11. The Treasury has managed to keep a lid on spending so far, but will that attitude survive the difficult (and potentially unpopular) decisions to come?

Public services

Biggest winner

The swift rollout of Covid-19 vaccines has been the government’s biggest success in 2021. By the end of July 2021, the UK had fully vaccinated 56% of the population against Covid, ranking it third among the G20 countries, behind only Canada and Spain. The vaccines taskforce, which struck deals to secure access to vaccines, was a major part of this success. By backing a variety of unproven vaccines and funding flexible manufacturing sites in the UK, the taskforce ensured that the government had early access to vaccines, speeding up the rollout.

Biggest loser

Test-and-Trace has been one of the biggest failures of the pandemic. It has repeatedly fallen short of its main objective – to “use testing to find people with Covid-19 and ensure both they and their recent contacts self-isolate to avoid passing the virus on to other people”. Although it did not spend its full budget of £37 billion, Test-and-Trace has consistently missed its targets for processing tests, reaching and telling close contacts to self-isolate, and ensuring adherence to self-isolation. Two major problems – low sick pay payments and high level of infections during the second and third waves – lay outside of Test-and-Trace’s control, but it bears responsibility for several problems. It did not involve and share data with local government early enough, and underestimated the foreseeable spike in demand for testing when schools returned in September.

What to look out for in the autumn

The autumn spending review will be the first major test of the government’s attempt to square its tight day-to-day spending plans with its promise of “world-class public services”. After a year of unprecedently high spending on the coronavirus response, the plans for public service spending in the next few years imply a tight spending review settlement. The government will have to decide which of the many competing demands on the public purse it will fund. How much do schools need to help pupils catch-up on lost learning? How much does the NHS need to tackle rising waiting lists? How will social care reform be paid for? We saw the outlines of this debate in the rows over overseas aid spending, school catch-up, and nurses’ pay. We should expect noisy public debates over public services in the autumn.