Johnson faces turbulent new year as threats to his premiership grow

When Boris Johnson made a brief appearance in public this week it was at a vaccination centre in Milton Keynes, where he encouraged the public to get a booster shot so they could "enjoy New Year sensibly and cautiously".

He said the success of Britain’s vaccination programme and the high proportion of the population that was already jabbed meant there would be no new coronavirus restrictions before the end of the year.

Johnson has been banking on the booster programme to help him avoid choosing between the wild libertarians on his backbenches who think current measures are too strict and the anxious scientific advisers and National Health Service (NHS) leaders who want tougher action.

In the first days after Christmas, as infections in London appeared to plateau and hospitalisation numbers remained below a manageable threshold, it looked as if his decision to wait and see was paying off. But as the week wore on the consequences of allowing infections to run out of control were becoming visible as essential services were cut back because of staff shortages.

For first time since January, Covid-19 seems to be everywhere in London

---

Silent nights in London as city drifts into unofficial shutdown

---

Conservatives are panicking but they are unlikely to abandon chaotic captain

---

Clubbable, shy and eccentric unite to do what the English do best

---

Southern Railways said on Thursday they were cancelling all services to and from London's Victoria Station until January 10th, and the fire brigade said that one in three of London's fire engines was off the road for the same reason.

Johnson sought to ease the problem by cutting the self-isolation period for those infected from 10 days to seven if they could show negative lateral flow tests for two successive days. The move saw the demand for tests, which are free by post or in pharmacies, shoot upwards to the point where the NHS was unable to keep up and health secretary Sajid Javid warned that tests would be rationed for the next two weeks.

Rebellion

The prime minister may now have to introduce restrictions when MPs return to Westminster next week, risking another backbench rebellion that leaves him depending on Labour votes to pass new regulations. It would be an inauspicious start to what promises to be a turbulent few months for the government, and especially for Johnson himself.

When the current coronavirus wave passes Britain faces a cost of living crisis driven by rising fuel prices, higher taxes and stagnant wages. Soaring prices of gas and electricity have already driven 28 energy suppliers out of the market and consumers face a big increase when the energy price cap is reviewed in April.

That month will also see VAT on hospitality return from 5 per cent to 20 per cent, the start of a four-year freeze on income tax bands and a 1.25 per cent increase in the national insurance rate. This last increase will hit every wage-earner but it will hurt the well-paid more than the rest.

When Britain’s supply chains were hit by a shortage of lorry drivers in October, Johnson told the Conservative party conference that it was all part of the Brexit plan to transform Britain into a high-wage, high-skilled economy. But with inflation running above 5 per cent, real wages are falling everywhere except in a handful of sectors and economists expect that to continue for most of 2022.

Johnson cannot wait that long for things to improve because he faces local elections in May that could spell the end of his premiership if the Conservatives fare badly. But any action he could take to lighten the burden on households and taxpayers carries the risk of a political backlash that could drive him out of Downing Street even sooner.

A £100 rebate on energy bills, similar to Ireland's scheme, would cost the British exchequer almost £3 billion, and increasing welfare benefits to help the poorest households through the winter could double the cost. Chancellor of the exchequer Rishi Sunak, who believes it is time to rein in public spending after the pandemic splurge, could take some persuading to write the cheque.

Extra spending

Sunak is also likely to resist scrapping the increase in national insurance, which was introduced to fund extra spending on the NHS to clear the treatment backlog built up during lockdown and to establish a new social care funding system.

Unpopular among MPs, the tax increase is a signal to bond markets that Sunak is serious about putting the public finances in order, and abandoning it would mean funding extra health spending through borrowing or by cutting spending elsewhere.

Neither Sunak nor foreign secretary Liz Truss, the other leading contender to succeed Johnson, share the prime minister's enthusiasm for heterodox economics. This aligns them with the views of Conservative MPs and party members but puts them at odds with Tory voters, who tend to endorse Johnson's embrace of the big state.

Unfortunately for the prime minister it is not the voters but the MPs who will decide his fate and, along with the party membership, choose who will succeed him.