Conservatives plan minor cabinet reshuffle

As the Conservatives returned to parliament with an 80-seat majority and Brexit scheduled for 31 January, Boris Johnson confirmed there would be a minor Cabinet reshuffle next week

This followed a bruising night for the Labour Party, when the Conservatives won 365 seats, with Labour 203, the Scottish National Party (SNP) 48, Liberal Democrats 11 and the DUP eight. This was the largest Conservative majority since Margaret Thatcher won a third term back in 1987.

In a speech outside number 10, Johnson said he would lead a ‘people’s government’ and there would be a minor reshuffle on Monday, followed by a debate on the Brexit Bill on Friday.

He told voters: 'Thank you for the trust you have placed in us and in me, and we will work around the clock to repay your trust and deliver on your priorities with a parliament that works for you.

'For those that did not vote for me, I want you to know that we in this one nation Conservative government will never ignore your good and positive feelings of warmth and sympathy towards the other nations of Europe - because now is the moment precisely as we leave the EU to let those natural feelings find renewed expression in building a new partnership which is one of the great projects of next year.'

Prior to the election, the Conservatives indicated that a Budget would be held in late February after the UK left the EU. The 6 November Budget was cancelled as a result of the ongoing Brexit delays and the election.

It is likely that there will be no major changes to the key Cabinet appointments with Sajid Javid set to remain at the Treasury. There are a number of major issues on his agenda, including the delayed review of the loan charge, under Sir Amyas Morse, and questions over the imminent introduction of IR35 off payroll rules for the private sector, set to come into effect from April 2020.

The Conservative manifesto had limited tax measures, with the main income tax rates frozen, a triple lock for pensioners and corporation tax fixed at 19%, having backtracked on plans to reduce the rate to 17% from 2020. In addition, they pledged to increase the threshold for national insurance contributions (NICs) increasing to £9,500 from £8,632, and a commitment to reform entrepreneurs' relief. 

On audit, the government delayed any plans to reform the Financial Reporting Council which requires statutory intervention to create the Audit Regulatory and Governance Authority (ARGA), as well as any action on the outcome of the Competition and Markets Authority (CMA) review of the audit market.

The CMA review set out wide ranging recommendations for an overhaul of the audit market, including the possible introduction of joint audit and a breakup of the Big Four audit firms.

The last Queen’s Speech in October made no mention of audit reform although it is understood that accounting bodies have been assured that this has not fallen off the agenda and will hopefully be included in a January Queen’s Speech.

Sara White

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