The constitutional causes and consequences of the Truss-Kwarteng budget crisis

Within weeks, Liz Truss’s premiership was plunged into economic and political turmoil due to Kwasi Kwarteng’s ‘mini budget’. But this crisis, suggests Meg Russell, has distinctly constitutional roots. Building on Boris Johnson’s legacy, Truss chose to sideline expert officials and regulators, and shut out her own MPs. The consequences that have since befallen her are a compelling advertisement for respecting – and rebuilding – appropriate constitutional checks and balances.

The Conservative Party conference, indeed the entirety of Liz Truss’s new premiership, has been severely destabilised by the market reaction to Chancellor Kwasi Kwarteng’s ‘mini budget’. Far from securing Truss her desired reputation for acting on the energy crisis and boosting the economy, and a positive bounce in the polls, Kwarteng’s 23 September ‘fiscal event’ saw the pound plunge, lenders withdraw mortgage products, and Labour achieve record poll leads. Faced with a mass rebellion by Conservative MPs, Kwarteng performed a U-turn on abolition of the top rate of income tax, while other parts of the package may face further such trouble ahead.

Fiscal policy is well beyond the usual scope of the Constitution Unit blog, or of this author. But the extent to which the unforced economic and political crisis built on foundations of poor constitutional and governance practice is striking. Boris Johnson played fast and loose with many constitutional norms, and Liz Truss seems quickly to have followed suit. But her now catastrophic position – with some Conservative MPs calling for the Prime Minister’s removal after less than a month in the job – demonstrates just how shortsighted and dangerous such behaviour can be.

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Boris Johnson’s constitutional legacy

Boris Johnson’s premiership is expected to end on 6 September, when it is anticipated that he will offer his formal resignation to the Queen at Balmoral and make way for the winner of the Conservative Party leadership election. Lisa James demonstrates that his time in office has been marked by an impatience with constitutional checks and balances and a willingness to depart from convention. She argues that his legacy risks being the normalisation of such behaviour.

What have been the major issues and challenges during Johnson’s premiership? 

Constitutional controversy has been a consistent feature of Boris Johnson’s premiership. His first months in office, amid the turmoil and acrimony of the late-2019 Brexit deadlock, were marked by the unlawful prorogation of parliament, suggestions that he would defy the law, and briefings from allies that if the Commons withdrew its confidence he would ‘dare the Queen to sack him’.

Thankfully, the monarch was not dragged into Johnson’s resignation this summer. But the Prime Minister stepped down only after a tense standoff with his own party, as it forced him from office over a series of standards-related scandals. The most prominent of these, partygate, will outlast Johnson’s premiership – with the Privileges Committee’s investigation into whether the Prime Minister misled parliament ongoing.

Though the intervening years perhaps lacked such obvious constitutional fireworks, these topics were never off the agenda. The Johnson government’s reform programme, and behaviour, often provoked controversy; the COVID-19 pandemic raised questions about how the country should be governed in times of crisis; and the fallout from Brexit heightened tensions over the territorial constitution, as discussed elsewhere on this blog – particularly in Northern Ireland.

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