The government faces some familiar problems as it gears up for the Spring Budget on March 15. The expectation that corporation tax will remain untouched by Jeremy Hunt will place the prime minister on a collision course with his manoeuvring predecessors in Boris Johnson and Liz Truss. But although flattering factions and appeasing antagonists have been key to Sunak’s political operation since October, the former chancellor takes fiscal stolidity seriously. Fresh from a political victory on the Northern Protocol and potentially another on “small boats”, the prime minister will have political capital to spare for the first time in his premiership. Maybe, just maybe, he can stare down his tax-cutting cynics.
However, the political facts foretell a potentially more telling showdown: not with the “Bring Back Boris” brigade or unrepentant Trussism — but versus one-man-faction and cabinet colleague, Ben Wallace.
“Wallace watch” is emerging as its own fruitful pastime in Westminster village, with the long-surviving cabinet minister never far away from the fiscal front-line. Consecutive prime ministers have surrendered defence policy to the well-respected secretary of state. Under Sunak, who the defence secretary refused to back twice over in 2022, Wallace’s personal fiefdom at MoD remains unassailed. It is an approach that has allowed Wallace to emerge as the longest-ever serving Conservative secretary of state for defence, withstanding the revolving door that has swept through ministries in recent months.
“Quite a low bar”, Wallace wisecracked when the achievement was raised by fellow Tory MP Mark Francois at the ConservativeHome’s defence and security conference on Monday. Outlasting Lord Peter Carrington, who served in Ted Heath’s cabinet for 3 years, 6 months and 19 days, is apparently little worth much to the man who served furthermore as security minister from 2016-2019.
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Not content with mere longevity, Wallace was however quick to expand on what he sees as his true legacy.
‘The Battle for Defence’
The “guns or butter” debate, referring to the classic economic trade-off on cost-of-living support and defence spending, has amped up in recent years. Putin’s illegal invasion of Ukraine has sent global prices spiralling and defence policy has rarely been more politically prescient. What is more, MoD is especially exposed to inflation due to its huge equipment projects.
Wallace is cognisant of these facts and his reported demand for an extra £11 billion for his department in the upcoming budget reflected the testing geopolitical and financial terrain. But the defence secretary’s position is nonetheless under concerted siege, with The Times outlining that the Treasury has rebuffed Wallace’s approach with an offer of £5 billion. It’s less than half of the defence secretary’s preferred sum.
When it was announced that Wallace would be speaking to the ConservativeHome conference on Monday, therefore, politics was braced for a new phase in Wallace’s fiscal brawl. Would the defence secretary go scored earth on spending?
No, was the answer.
Instead, Wallace outlined that he was “pretty confident” that the armed forces will get the funding they need in the upcoming budget.
On the surface it was a rapid, ragged retreat.
However, the defence secretary conditioned his support with a more substantive declaration: “The real battle for defence will be the next Comprehensive Spending Review period [in 2024-25]”.
Far from an armistice in his war of words with the treasury, therefore, the subtext suggested an extension of animosities. Although Wallace might lose the Spring budget battle, he would, he insisted, win the war.
The “battle for defence”, Wallace explained, was not a campaign limited to a Spring offensive headed by a noncommittal Treasury lieutenant — but part of a broader mission of “culture” change in Whitehall. Defence policy could no longer be defined by the mistaken terms of the world’s post-Cold War détente.
Wallace outlined the new reality: “The Treasury and other government departments will just have to get used to the fact that come the next Spending Review envelope, defence will have a greater share than it’s traditionally done”.
Wallace was here promising to continue his advance on the Treasury for more UK defence funding. It would be a prolonged conflict.
Curiously, the defence secretary’s reference to the 2024-25 spending review was a signal that he was not treating the 2024 election as a deadline for delivery. It is a stark comparison to other leading lights of Conservative governance, whose briefs have been defined by the deliberately short-termist “five priorities” announced by the prime minister in January. Culture change, Wallace calculates, cannot operate on such an arbitrary timetable.
Addressing the ConservativeHome audience, Wallace even issued what might be interpreted as a coded critique of Sunak’s “five priorities”:
“[I have been trying] to change the culture of where defence should sit in our psyche, in our elections, where it should sit in our importance. … Because governments always say, of whatever colour, that ‘the first duty of government is to defend the nation’ and then promptly go on and leave it well off the priorities of any electoral campaigns we ever see”.
Wallace hence counselled: “I think the biggest thing that the government could do … is give me a ten year budget. My Italian colleagues got a ten year budget. My German colleagues got a ten year budget. My French colleagues have ten year budget”.
As a senior government minister, one wonders who Wallace’s intended audience was here. But it surely went far bar beyond those stationed before him at the ConservativeHome conference. The suggestion also begs the question of Wallace’s broader approach to cabinet collective responsibility.
Winning the war
In January, when the prime minister promised to halve inflation, grow the economy, reduce debt, cut NHS waiting lists and pass laws to stop “small boats”, he claimed he was pronouncing the “people’s priorities”. But the short-term political calculation behind the pledge-making was hardly concealed. The PM was laying down some classic Conservative calling cards in a bid to challenge the still unproven Starmerite electoral machine. It was an overt acknowledgement that the government needs some policy success on which to rely in 2024.
As one of a few cabinet ministers to have emerged through the Conservative “permacrisis” with his reputation enhanced, Wallace simply does not conceive of policy-making on these terms.
Defence policy does not have time for “permamcrisis” or its debilitating legacy. Nor can it be encumbered by political point-scoring — certainly not a time of land war in Europe.
This point is crucial. For Wallace does not define success by a Conservative victory in 2024.
“I’m not sure I’ll be here in two years”, Wallace suggested on Monday. Perhaps tellingly, the forbearance didn’t seem to fuss the defence secretary. As he explained to the ConservativeHome audience, his priority is now to engrain a new “culture” in Whitehall, bolstering ideas sufficiently that a future secretary of state may be unable to ditch them. His ultimate victory, therefore, will not come via electoral triumph, but the curation of meaningful institutional memory in the defence department. Any other outcome could prove pyrrhic in the long term.
And when all is said and done, NATO leadership and the secretary-general position may just await.
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