Just over a month has passed since Liz Truss won the Conservative leadership contest and yet doubts over her durability as Prime Minister have already begun to emerge. With one significant policy U-turn already (the proposed cut to the 45p rate of tax) and with a number of other issues bubbling under the surface, the idea that Truss may not lead the Conservatives into the next election is no longer farfetched.

This H/Advisors Cicero briefing contains a breakdown of how a challenge and/or resignation may occur and what would happen next.

Is Truss safe from a no confidence vote?

Under the current rules, yes. Having just been elected leader, Liz Truss is theoretically safe from a no confidence vote for another 11 months, even if 15% of the Conservative Parliamentary Party write to the Chairman of the Conservative backbench 1922 Committee, Sir Graham Brady.

However, the rules could be changed by the 1922 Committee to either suspend the 12-month rule, amend it (e.g. to three or six months), or abolish it altogether. Should this happen, and should the 15% threshold be met, then a vote of no confidence would be held in the Prime Minister’s leadership.

In addition, a Government can only continue in office if it has the ‘confidence’ (or support) of the House of Commons. Whilst majority governments are assumed to have confidence through the number of seats they hold in the House of Commons, governments can also themselves designate a particular vote as being a ‘matter of confidence’ in order to scare backbenchers into voting with the whip.

Although it is unlikely to happen given the Tories retain their Parliamentary advantage over Labour and the other opposition parties, a motion of no confidence in His Majesty’s Government could be forced by the Official Opposition and, depending on the votes of Conservative backbenchers, could oust Truss as Prime Minister. A confidence motion tabled by the official opposition is given priority as a matter of Parliamentary convention for a debate and vote in the House of Commons.

If the Government loses a confidence motion, it can either resign in favour of an alternative government taking office – which would need to give assurances to the King that a new majority can be assembled – or it can seek a dissolution of Parliament, leading to a general election.

It is worth remembering however that even at the height of Theresa May’s unpopularity in January 2019 her Government survived a Vote of No Confidence tabled by Jeremy Corbyn, as backbench Tory MPs closed ranks and voted to keep their beleaguered Prime Minister in office.

Could she be forced out by the Cabinet?

Yes, although that remains unlikely at this stage. While Truss has created many enemies for herself by not appointing any Rishi Sunak supporters to her Cabinet, her top team is now full of loyalists who backed her in the leadership contest. Even with polls looking particularly dire for the Tories, it is currently unlikely her Cabinet would stage the kind of intervention we saw back in July when Boris Johnson was forced out by a spate of resignations and senior Ministers telling him he had to go.

However, it is notable that tensions are already rising within Truss’ Cabinet, with tensions already visible between the PM and Chancellor, and senior figures such as Penny Mordaunt openly going beyond Government lines on issues such as welfare policy. Despite appointing a largely supportive Cabinet, it is conceivable that things change quickly in this respect and the loyalty of senior Ministers will be a key indicator to monitor.

Could she be brought down a different way?

Yes, the Truss Government could lose votes on the Finance Bill (the legislative vehicle for any Budget) or on the King’s Speech which would set out her legislative programme – traditionally seen as confidence matters. There are reports already that the Finance Bill will be pushed back until the spring, and that the only budgetary measure MPs will vote for in the coming weeks will be on the reversal of the National Insurance increase. Given the cross-party support for this measure, it is unlikely to fail. However, the postponement of the Finance Bill suggests that there is not a lot of confidence that all Tory MPs will vote with the Government on key measures announced in the fiscal event back in September.

How might a leadership contest operate?

The consensus is that the Conservative Party cannot afford to hold another two-month long leadership contest, especially not so soon after the last one. There are therefore only two options:

1. A leadership contest determined by MP votes only.
2. An ‘acclamation’ in a similar vein to the 2003 election of Michael Howard where no candidate stood against him.

The second option seems the most likely. In 2003, having lost a confidence vote, Iain Duncan Smith resigned as Tory leader. As soon as the result of the confidence vote was known, senior MPs and prospective candidates David Davis and Oliver Letwin announced that they would be supporting the former Home Secretary, Michael Howard, who had emerged as the preferred candidate among the backbenchers. With other possible contenders such as the former Chancellor, Ken Clarke, and the then Deputy Leader Michael Ancram, declining to run, Howard was elected unopposed just eight days later.

Who might run?

• Rishi Sunak, who commanded the support of the most MPs but lost out to Truss in the membership vote. The former Chancellor would represent a return to a more orthodox economic policy. He wasn’t beaten in the membership as convincingly as some had predicted. May lack legitimacy in the eyes of the party faithful, many of whom blame him for the resignation of Boris Johnson – something which could hinder his chances of emerging as a consensus candidate.
  
• Boris Johnson, the recently ousted Prime Minister. Whether the former Prime Minister would decide to return to his old job so soon after being removed by his MPs remains to be seen, and it is unclear that Tory MPs would turn to him given how dire his own poll ratings were when he was removed. However, many MPs nevertheless are feeling buyer’s remorse and recognise that Johnson is, if nothing else, a proven election winner with an electoral mandate that is only three years old.
  
• Michael Gove, the longtime Cabinet Minister who has been doing the rounds on the fringes of Conservative Party Conference undermining Truss and Kwarteng’s leadership. One of the figures who could be tasked with restoring some credibility to the party and lead it into the next general election. Despite his widely regarded competence as a departmental minister and agent of change, many in the party distrust him and he is a divisive figure in electoral terms. Could return to the front line in a future cabinet in a Mandelsonian revival. 
  
• Sajid Javid, the former Chancellor and leadership contender, could also prove to be a unifying figure. He is a possible replacement for Kwasi Kwarteng as Chancellor should the latter be forced to resign. However, his lack of sparkle as a communicator will hold any candidacy back as it did in the last leadership race. His resignation helped topple Johnson, which will also count against him.
  
• Jeremy Hunt, the former Foreign Secretary who was defeated by Johnson in 2019, ran this year but did not make it past the first round. He has little support among the party, but could be seen as a caretaker especially as his brand of One Nation Conservatism might help the party in its traditional southern heartlands. The lack of enthusiasm for his candidacy in the last leadership election probably rules him out.
  
• Penny Mordaunt, the current Leader of the House who came third in the most recent leadership contest. As a serving Cabinet Minister and a former leadership contender who was only just pipped by Truss in the final round of the MP stage in July, Mordaunt would be another contender and no doubt has the ambition to have another run at the top job.
  
• Ben Wallace, the well-respected Defence Secretary, who was widely seen as a favourite back in the summer before he decided against a run for the top job. It’s hard to see what might have changed his mind on standing since then. For this reason he’s probably an outside chance. Nevertheless, having not stood, he doesn’t carry the baggage of his colleagues which may prove helpful if he does change his mind.
  
• Kemi Badenoch, the International Trade Secretary was the breakout star in the contest in July. Seen as one of the likeliest candidates for a future race, she may decide to sit this one out – especially if the polls are looking bad for the Conservatives. MPs may not want to take a risk with someone untested, though they may also ask if anything can get any worse than now. With the support of Michael Gove, who was behind her campaign in the summer, she could rally enough support should she decide to run if a vacancy emerges at the top.

Can Truss reset and survive?

It might seem difficult to fathom now, but a scenario in which Truss regains her footing and continues until the next election remains highly plausible. Having only been in post for a month, many MPs will want to give her the benefit of the doubt, and tomorrow’s keynote speech in Birmingham will be a prime opportunity for a ‘reset’ moment.

In addition, she could always conduct a reshuffle, and remove her Chancellor, Kwasi Kwarteng, in order to bring in a figure which could command the respect of both the Parliamentary party and the markets. Such a move would show her to be less ideological than previously assumed, and would demonstrate flexibility at a time of economic volatility which would help calm the markets. The name touted is Sajid Javid, who briefly served as Boris Johnson’s Chancellor between 2019 and 2020.

We will continue to provide updates and analysis as the days and weeks unfold. Should you have any questions please do not hesitate to get in touch.