Can Rishi Sunak move on from the era of ‘Tory sleaze’?

Early on Sunday morning prime minister Rishi Sunak, at his constituency home in the Yorkshire Dales, received the report which sealed the fate of Nadhim Zahawi.

It confirmed what opposition MPs, much of the media and countless voters had already guessed: that the Conservative chair had not behaved honourably over the handling of his tax affairs.

The report from Sir Laurie Magnus, ethics adviser, found several breaches of the ministerial code between 2021 and 2022, forcing the prime minister to sack the MP whom he had defended in parliament less than a fortnight before.

The findings have raised further questions around whether Sunak inquired deeply enough about Zahawi’s tax affairs, and whether the prime minister would be able to draw a line under years of “Tory sleaze” allegations.

Lord Gavin Barwell, former chief of staff at Downing Street, said the premier had handled the issue “in the right way”, but added: “A lot of Conservative MPs think politically it’s taken too long to resolve the issue.”

George Osborne, former Tory chancellor, told Channel 4 on Sunday evening that the scandals were reminiscent of the 1990s under former prime minister John Major.

Liz Truss and Nadhim Zahawi in August 2022 © Geoff Caddick/AFP/Getty Images

“Major was likeable, conscientious, like Rishi Sunak, but ultimately was not able to escape the downward pull of the Tory party . . . he [Sunak] knows that as each week passes, as each new scandal unfolds, the window for action gets smaller and smaller.”

Commissioned less than a week ago by the prime minister, the investigation by Magnus revealed how the former Tory chair had trampled over the ministerial code by failing to fully disclose details of his dispute, and eventual £5mn settlement, with the tax authority.

He had not only failed to share with colleagues the fact that HMRC was investigating him but had also insisted, wrongly, that questions from journalists were a “smear”, issuing them with legal threats.

Baghdad-born Zahawi made a fortune in business as founder of the pollster YouGov before his election as Tory MP for Stratford-on-Avon in 2010.

Last year alone he held several cabinet jobs — education, chancellor, Cabinet Office and chair — but he conceded in his resignation letter on Sunday that his future now lay on the backbenches.

The prime minister, who is said by colleagues to have fired Zahawi more in sorrow than anger, still faces questions from the opposition Labour party about what he knew about the affair.

Magnus’s report says Zahawi failed to disclose “the nature of the investigation and its outcome” both in September and October last year, when the MP was given two separate cabinet roles.

But the phrasing of the report allows for the possibility that either former prime minister Liz Truss or her successor Sunak — or both — knew in general terms about the HMRC investigation.

The Labour leadership has written to Sunak asking when he was made aware of the HMRC investigation; why he stated at Prime Minister’s Questions on January 18 that all questions on the issue had been answered; and what discussions he had with Zahawi before appointing him.

Number 10 said Sunak was reassured there were “no outstanding issues”. A new Conservative chair could be appointed as early as this week.

By jettisoning Zahawi, Sunak hopes to dislodge his party from continuing scandal allegations. He hopes to shift the focus on to his priorities of ending the NHS crisis, cutting inflation and dealing with migrants crossing the English Channel.

Yet government insiders admit to still feeling “besieged” — in the words of one — by rolling scandals involving senior Conservative MPs which may predate Sunak’s premiership but are still corroding it.

Labour has insisted that Sunak is “weak” and is failing to stick to his promise to instil “integrity, professionalism and accountability at every level” of his government.

Labour MPs have asked why Sunak sacked Zahawi but reappointed Suella Braverman as home secretary in October, just days after she broke the ministerial code by using personal email to send a draft government statement to a political ally.

The next looming controversy involves Dominic Raab, deputy prime minister and justice secretary, who faces serious bullying allegations, which he denies.

Dominic Raab, Sunak’s justice secretary, faces claims of bullying © HOC/PA

An official inquiry into Raab, ordered by Sunak and led by employment lawyer Adam Tolley KC, will examine more than eight historic complaints involving more than 24 civil servants.

Raab has promised to “thoroughly rebut and refute” the claims, saying he “acted professionally” at all times.

Meanwhile, scandals involving Boris Johnson, who in July announced that he would step down as prime minister after a revolt by Tory MPs, still casts a shadow.

Johnson, now a backbench MP, will shortly be summoned to televised hearings as the privileges committee investigates whether he lied to MPs about the “partygate” affair, when 83 staff were fined for attending Downing Street parties during Covid-19 lockdowns.

The committee, which has a Tory majority but is chaired by Labour veteran MP Harriet Harman, is looking into whether Johnson deliberately misled parliament when he told the Commons “all guidance was followed completely” by staff working in Whitehall at the time.

If the committee finds him to be in contempt of parliament, he could be suspended from the Commons. If he is suspended for more than 10 days a “recall petition” could be triggered and a potential by-election.

Johnson’s chaotic personal finances have generated controversy in relation to his receipt a loan of up to £800,000 — while in Number 10 — from Sam Blyth, a Canadian businessman and distant cousin, after receiving advice from Richard Sharp — who was soon afterwards appointed BBC chair.

Johnson says Sharp had zero knowledge of his private finances. But a leaked memo, published by the Sunday Times, revealed that cabinet secretary Simon Case had warned the prime minister: “Given the imminent announcement of Richard Sharp as the new BBC chair, it is important you no longer ask his advice about your personal financial matters.”

Sharp’s appointment is now being probed by the BBC and by William Shawcross, commissioner for public appointments.

“Sometimes I feel like we are all in a boat and we are just being buffeted by high winds and tall waves,” said one backbench MP on Sunday. “I wish we could just rediscover a sense of direction.”

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