After top ministers quit, defiant Johnson stays on despite louder calls to resign

ROCKED by a double Cabinet resignation, British Prime Minister Boris Johnson moved quickly on Wednesday to appoint new Finance and Health Secretaries to avoid a collapse of his government as he continues to deal with a political and economic crisis.

The pound plunged 2 per cent to a 2-year low against the US dollar in the space of a day, while UK equities are under pressure.

The market fears that a paralysed government, weakened by the exit of several senior and junior ministers, would not be able to cope with an inflationary recession and the ongoing Covid-19 pandemic.

In a desperate attempt to remain prime minister, the beleaguered Johnson named former education secretary Nadhim Zahawi to replace Rishi Sunak as chancellor of the exchequer, and promoted his chief of staff Steve Barclay to be the new health secretary.

The sudden departures of Sunak and Javid are widely seen as severe body blows to Johnson and the UK government. Both ministers were vocal in questioning Johnson’s integrity, numerous policy u-turns and leadership ability. Analysts see both Sunak and Javid as leading contenders to succeed Johnson at some point.

“His premiership is doomed,” said William Hague, a former leader of the Conservative Party and a former foreign secretary. “Johnson needs to resign now as things will only get worse, not better.”

Michael Heseltine and Malcolm Rifkind, both former cabinet ministers under the late prime minister Margaret Thatcher, also agreed that Johnson should vacate the top job, and soon.

“After all the sleaze, the scandals and the failure, it’s clear this government is now collapsing,” said Keir Starmer, the leader of the opposition Labour Party which is 10 points ahead in the polls. ”Tory cabinet ministers have been his cheerleaders throughout this sorry saga (and) backing him when he lied repeatedly. In doing so, they have been complicit every step of the way.”

A new YouGov poll of around 3,000 voters in the UK found that 69 per cent wanted Johnson to be replaced.

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Less than 24 hours after the double resignation, the pound continued to decline against the US dollar on Wednesday. The pound traded down 0.3 per cent at $1.1921 after starting the week above $1.21. 

The pound’s 13 per cent slide against the greenback since the beginning of the year, a 5 per cent decline against the euro and yen and a 9.9 per cent fall against the Singapore dollar, illustrate the extent of the UK stock market’s concerns.

In the first quarter of this year, the British economy expanded by a mere 0.8 per cent, with many economists predicting a contraction in the second quarter. Meanwhile, inflation currently stands at 9.1 per cent and interest rates are rising.

The FTSE 100 index is only down 7.2 per cent from its January peak because many constituents are multinational companies that benefit from the pound’s devaluation. The FTSE 250, which concentrates on local companies, has slumped by 23 per cent.

For now, Johnson has indicated he is not ready to step down. He still has some supporters, including Brexit Minister Jacob Rees-Mogg, who vigorously supported Johnson despite the recent Partygate scandal and huge losses in by-elections earlier this year.

All eyes are also on other key Cabinet ministers such as Deputy Prime Minister Dominic Raab, Home Secretary Priti Patel and Foreign Secretary Liz Truss, and whether they might follow Sunak and Javid out the door.

Meanwhile, a growing number of backbencher MPs are plotting to oust Johnson. Rebel Tory MPs narrowly lost a recent no-confidence vote against Johnson. Under the Conservative Party’s rules, the leader can stay on for another year, but the Toy rebels are determined to challenge the rules and force him out.

Many have said they are concerned about losing their seats in the next general election, due by 2024, and they want to see the leadership crisis resolved before parliament takes its usual summer recess later this month.