Analysis-After Johnson Outburst, UK's Sunak Faces Tax Cut Demands From Divided Party

Prime Minister Rishi Sunak will face more pressure from his fractious party to cut taxes after a blistering critique from Boris Johnson, even if the British leader can most probably stave off more resignations.

Former prime minister Johnson quit as a lawmaker late on Friday over an investigation into rule-breaking parties during the COVID pandemic, with a statement that deepened the divisions in the governing Conservatives and further hindered its efforts to make a comeback in the polls before an election due in 2024.

Two Johnson allies also resigned their parliamentary seats at the end of last week, partly over what they saw as broken promises of future peerages.

But their departures were overshadowed by Johnson's resignation statement calling for reduced business and personal taxes and a "properly Conservative government" - words that were aimed at Sunak and have started to resonate in the party.

Described by a party insider as "throwing hand grenades" at Sunak's government, the statement has spurred members who have criticised the government for being too cautious in pursuing what they say is the party's traditional agenda of cutting taxes and regulation to boost a flagging economy.

"Rishi needs to get a grip pretty quickly. He needs to listen to what Boris said about tax and growth and tell (finance minister) Jeremy Hunt plainly that he has to revert to Conservative fiscal policies," said one Conservative lawmaker.

"The tax burden must come down," the lawmaker said on condition of anonymity.

Several Conservatives would like to see tax cuts before the next election, but Sunak and Hunt say they want to prioritise bringing down inflation. The government's budget forecasters show Hunt has the smallest leeway of any chancellor since the Office for Budget Responsibility began its forecasts in 2010.

With a national election expected next year and the Conservatives lagging the opposition Labour Party by double-digit figures in opinion polls, Sunak has tried to bring stability to a party that has had three prime ministers in four years.

But Johnson, Sunak's allies say, has done little to allow his successor to bring calm to Downing Street, with the probe into his behaviour during COVID-19 lockdowns and his prominent media profile offering him ample opportunity to share his views.

They point to what they see as the hypocrisy of Johnson, whose government, also under then-finance minister Sunak, oversaw a huge increase in pandemic spending that pushed Britain's tax burden towards the highest level in decades.

RESIGNATIONS

Johnson's supporters have also not been shy in criticising Sunak's government, and the resignations of Johnson, and his two allies Nadine Dorries and Nigel Adams, increases pressure on the British leader by triggering three so-called by-elections.

According to the polls, the Conservatives are likely to lose two of those votes, with the third difficult to call.

With some of his electoral pledges faltering, including controlling the arrival of migrants and bringing down persistently high inflation, Sunak came out fighting when asked about Johnson's treatment, saying he was asked by the former prime minister to do something he could not do.

If people didn't like his decision to rubber stamp the removal of some individuals nominated by Johnson to sit in the House of Lords upper house of parliament "then tough", he told a tech summit. It was that decision that some Conservatives said lay behind the resignations of Dorries and Adams.

But while Sunak tries to show he is more focused on governing than on dramas in the Conservative Party, it is losing support, with Labour capitalising on the party's deep divisions.

"You can't win an election when the party hates each other this much," said a former party special adviser. "It just looks ridiculous."

Johnson has always stirred powerful emotions in his own party and beyond, with a parliamentary committee's investigation into whether he wilfully misled parliament over "partygate" offering yet another chance for lawmakers to sound off against him. The committee is due to make its report public this week.

Some have called him a known liar, unable to govern or help a party that is struggling to hold on to voters after 13 years in power. Others say he is the kind of campaigner who won an overwhelming majority in 2019 and could change their fortunes.

Johnson has "had his time and we need to him move on. He is embarrassing himself and the party," said one Conservative lawmaker who was once a supporter of the former prime minister.

But Johnson, who says there is not "a shred of evidence" that he misled parliament, has kept the door open on whether he could return to politics, saying in his statement that he would be "leaving parliament - at least for now".

"Never rule Boris out of anything," a Conservative lawmaker said.