# New PM Rishi Sunak pledges to lead Britain out of economic crisis
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-10-25
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Rishi Sunak Sworn In as UK's Third PM in Two Months,
Meta Description: Rishi Sunak pledges to lead UK out of economic crisis, rebuild trust in politics. Reappointed Hunt, Raab to calm markets and unite party for tough decisions.
URL: https://financedigest.com/new-pm-rishi-sunak-pledges-to-lead-britain-out-of-economic-crisishtml

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By Kate Holton, Elizabeth Piper and Alistair Smout

LONDON (Reuters) -Rishi Sunak became Britain’s third prime minister in two months on Tuesday and pledged to lead the country out of a profound economic crisis and rebuild trust in politics.

Sunak quickly reappointed Jeremy Hunt as his finance minister in a move designed to calm markets that had balked at his predecessor’s debt-fuelled economic plans.

The former [hedge fund](https://www.financedigest.com/what-is-a-hedge-fund.html "What Is A Hedge Fund") boss said he would unite the country and was expected to name a cabinet drawn from all wings of the party to end infighting and abrupt policy changes that have horrified investors and alarmed international allies.

Speaking outside his official Downing Street residence, Sunak praised the ambition of his predecessor Liz Truss to reignite [economic growth](https://www.financedigest.com/addressing-the-credit-gap-to-unlock-economic-growth-in-africa.html "Addressing the credit gap to unlock economic growth in Africa") but acknowledged mistakes had been made.

I have been elected as leader of my party and your [prime minister](https://www.financedigest.com/britains-queen-elizabeth-will-appoint-new-prime-minister-at-balmoral.html "Britain’s Queen Elizabeth will appoint new prime minister at Balmoral"), in part to fix them,” said Sunak, who broke with the tradition of standing beside his family and cheering political supporters.

I understand, too, that I have [work to do to restore trust](https://www.financedigest.com/how-to-hybrid-trusting-employees-to-work-from-home.html "How to hybrid: Trusting employees to work from home "), after all that has happened. All I can say is that I am not daunted. I know the high office I have accepted and I [hope to live up to its demands.”](https://www.financedigest.com/oil-rises-on-demand-hopes-as-banking-crisis-fears-subside.html "Oil rises on demand hopes as banking crisis fears subside")

Sunak said difficult [decisions lay ahead](https://www.financedigest.com/cyclicals-bat-drag-ftse-100-lower-ahead-of-fed-decision.html "Cyclicals, BAT drag FTSE 100 lower ahead of Fed decision") as he looks to cut public spending. Hunt, who Truss [appointed to calm markets roiled by her dash for growth](https://www.financedigest.com/impact-com-appoints-new-chief-people-officer-to-lead-people-growth-and-excellence.html "impact.com Appoints New Chief People Officer to Lead People Growth and Excellence"), has been preparing a new budget alongside borrowing and growth forecasts due out on Monday, and repeated his warning on Tuesday that “it is going to be tough.

The new prime minister also restored Dominic Raab to the [post](https://www.financedigest.com/will-mays-new-minister-percy-keep-the-northern-powerhouse-on-track-post-brexit.html "WILL MAY’S NEW MINISTER PERCY KEEP THE NORTHERN POWERHOUSE ON TRACK POST BREXIT?") of deputy prime minister, a role he lost in Truss’s 44 days in office, but reappointed James Cleverly as foreign minister and Ben Wallace at defence.

Penny Mordaunt, who ended her bid to win a leadership contest against Sunak on Monday, also retained her position as leader of the House of Commons, a role that organises the [government’s business](https://www.financedigest.com/uk-government-to-cap-energy-bills-for-businesses-bloomberg.html "UK government to cap energy bills for businesses – Bloomberg") in the lower house of parliament.

Sources had said she wanted to become [foreign minister](https://www.financedigest.com/james-cleverly-to-remain-uk-foreign-minister-statement.html "James Cleverly to remain UK foreign minister – statement").

With his new appointments, Sunak was seen to be [drawing ministers from across the Conservative Party while leaving others in post – a move that should ease concerns](https://www.financedigest.com/oil-near-flat-as-us-crude-stock-draw-contends-with-economic-concerns.html "Oil near flat as US crude stock draw contends with economic concerns") that Sunak might appoint loyalists rather than try to unify the party.

TOUGH DECISIONS

Sunak, one of the richest men in parliament, is expected to slash spending to plug an estimated 40 billion pound ($45 billion) hole in the public finances created by an economic slowdown, higher borrowing [costs and an energy support](https://www.financedigest.com/5-ways-to-support-your-employees-during-the-cost-of-living-crisis.html "5 ways to support your employees during the cost of living crisis ") scheme.

He will now need to review all spending, including on politically sensitive areas such as health, education, defence, welfare and pensions. But with his party’s popularity in freefall, he will [face growing calls for an election](https://www.financedigest.com/estonias-pro-kyiv-government-faces-election-test-amid-cost-of-living-crisis.html "Estonia’s pro-Kyiv government faces election test amid cost of living crisis") if he ditches too many of the promises that the Conservatives win election in 2019.

Economists and investors have welcomed [Sunak’s appointment – Ryanair boss Michael O’Leary said the adults had taken charge again – but they warn he has few options to fix the country’s finances when millions are battling a cost of living](https://www.financedigest.com/indefensible-uks-sunak-under-fire-over-response-to-cost-of-living-crisis.html "‘Indefensible’: UK’s Sunak under fire over response to cost of living crisis") crunch.

Sunak, who ran the Treasury during the COVID-19 pandemic, promised to put [economic stability and confidence at the heart of the agenda](https://www.financedigest.com/infosecurity-europe-agenda-spotlights-innovation-as-security-leaders-address-cybersecurity-spend-in-the-face-of-economic-headwinds.html "Infosecurity Europe agenda spotlights innovation as security leaders address cybersecurity spend in the face of economic headwinds"). This will mean difficult decisions to come,” he said, shortly after he accepted [King Charles’s](https://www.financedigest.com/in-loving-and-devoted-memory-king-charles-handwritten-note-to-late-queen.html "‘In loving and devoted memory’: King Charles handwritten note to late queen") request to form a government.

Sunak also vowed to put the public’s need above politics, in recognition of the growing anger at Britain’s political class and the ideological battles that have raged ever [since the historic 2016 vote to leave](https://www.financedigest.com/worst-flooding-since-1998-leaves-33bn-economic-toll-in-china-according-to-aon-catastrophe-report.html "Worst flooding since 1998 leaves bn economic toll in China, according to Aon catastrophe report") the European Union.

Workers [heading towards London’s financial](https://www.financedigest.com/the-hidden-financial-woes-of-international-students-heading-for-the-uk.html "The Hidden Financial Woes of International Students Heading for the UK") district said Sunak, at 42 Britain’s youngest prime minister for more than 200 years and its first leader of colour, appeared to be the best of a bad bunch.

I think he was competent, and that’s [really what we should hope for at the moment,” said management](https://www.financedigest.com/with-the-right-active-manager-you-really-do-get-what-you-pay-for.html "With the Right Active Manager, You Really Do Get What You Pay For") consultant, James Eastbook, 43.

With two prime ministers appointed in two [months without a popular](https://www.financedigest.com/august-the-most-popular-month-to-start-a-holiday-home-search-reveals-portal.html "AUGUST THE MOST POPULAR MONTH TO START A HOLIDAY HOME SEARCH REVEALS PORTAL") vote, some called for a general election now but others hoped Sunak would stay until the next scheduled election, due by January 2025.

POLITICAL MACHINATIONS

Sunak, a Goldman Sachs analyst who only entered parliament in 2015, [faces a challenge](https://www.financedigest.com/under-saved-and-underprepared-women-face-challenges-saving-for-retirement.html "UNDER-SAVED AND UNDERPREPARED: WOMEN FACE CHALLENGES SAVING FOR RETIREMENT") ending the factional infighting that has brought his party low. Many Conservatives remain angry with him for quitting as [finance minister](https://www.financedigest.com/scottish-finance-minister-kate-forbes-to-run-for-countrys-leadership.html "Scottish finance minister Kate Forbes to run for country’s leadership") in July and triggering a wider rebellion that ended Boris Johnson’s premiership.

Others question how a multi millionaire can lead the country when millions of people are [struggling with surging food and energy](https://www.financedigest.com/french-energy-suppliers-will-let-struggling-bakers-renegotiate-contracts-le-maire.html "French energy suppliers will let struggling bakers renegotiate contracts – Le Maire") bills.

I think this decision sinks us as a [party for the next election,” one Conservative](https://www.financedigest.com/rishi-sunak-declared-next-leader-of-uk-conservative-party-to-become-next-pm.html "Rishi Sunak declared next leader of UK Conservative Party, to become next PM") lawmaker told Reuters.

Historian and political biographer Anthony Seldon said Sunak would also be constrained by the mistakes of his immediate predecessor.

“There is no leeway on him being anything other than extraordinarily conservative and cautious,” he told Reuters.

Many politicians and officials abroad, having watched as a country once seen as a pillar of economic and political stability descended into brutal infighting, welcomed Sunak’s appointment.

Sunak, a Hindu, also becomes Britain’s first [prime minister](https://www.financedigest.com/economist-odor-picked-as-slovakias-caretaker-prime-minister.html "Economist Odor picked as Slovakia’s caretaker prime minister") of Indian origin.

U.S. [President Joe Biden](https://www.financedigest.com/biden-arrives-in-south-korea-for-talks-with-president-yoon.html "Biden arrives in South Korea for talks with President Yoon") described it as a “groundbreaking milestone”, while leaders from India and elsewhere welcomed the news. Sunak’s billionaire father-in-law, N.R. Narayana Murthy, said he would serve the [United Kingdom](https://www.financedigest.com/the-future-of-fintech-and-open-source-cloud-solutions-in-the-united-kingdom.html "The future of fintech and open source cloud solutions in the United Kingdom") well.

We are proud of him and we wish him [success,” the founder](https://www.financedigest.com/attorney-and-founder-of-chukwuma-law-group-jeff-c-chukwuma-on-intuition-as-a-tool-for-successful-outcomes.html "Attorney and Founder of Chukwuma Law Group, Jeff C. Chukwuma on Intuition as a Tool for Successful Outcomes") of software giant Infosys said in a statement.

($1 = 0.8864 pounds)

(Writing by by Kate Holton and Elizabeth Piper; Editing by Hugh Lawson and Jon Boyle)


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