Boris Johnson's ousting of his finance minister could actually limit his options

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Last week's surprise resignation of Sajid Javid, the U.K.'s short-lived finance chief, could limit Boris Johnson's ability to make personnel changes in the future.

So when Prime Minister Johnson asked him to stay on, but insisted he would have to make do without his own team of personal advisors, Javid doubtless saw this as a form of attempted humiliation. His subsequent resignation upset the carefully planned and executed changes to the Johnson government last week, and delayed what was clearly meant to be a precisely choreographed piece of political theater.

But as one former senior Treasury advisor who has worked under more than one chancellor pointed out to me, Javid's former deputy and now his successor, Rishi Sunak, had been given a "hospital pass" with the new budget that is expected in just a matter of weeks. But he also suggested that Sunak's position was now incredibly secure for the foreseeable future, because a prime minister that sacks or forces out two chancellors might appear to have a management problem — in the eyes of his fellow politicians, not to mention investors. To misquote Oscar Wilde, it is a misfortune to lose one chancellor, but to lose two smacks of carelessness.

Britain's Chancellor of the Exchequer Sajid Javid attends a session during the 50th World Economic Forum annual meeting in Davos, Switzerland, January 22, 2020. REUTERS/Denis BalibouseJohnson repeatedly made clear during last year's election campaign that he wanted to spend money — on infrastructure, underserved communities and economically transformative industries.

It is still not clear if there were more serious disagreements between the two men that led to Javid's ouster, but right now, for the financial markets and investors watching the British economy closely, it will be Sunak's ability to maintain fiscal prudence that will be under the microscope.

 

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