2018 Conservative Party leadership election

The 2018 Conservative Party leadership election occurred as a result of Prime Minister David Cameron's resignation as party leader. He had resigned as part of a pledge made in the 2015 general election campaign that he would not seek a third term as Prime Minister. Cameron, who had initially intended to resign in 2019, decided to step down one year early so as to give his successor more time before the next election, which was then scheduled for 2020. Cameron announced his resignation on 24 May, saying that he would step down as Prime Minister after a new leader had been chosen. George Osborne won the contest on 11 July 2018, after the withdrawal of Michael Gove left him as the sole candidate.

Conservative Members of Parliament had voted initially in a series of ballots to determine which two candidates would go forward to a nationwide ballot of Conservative Party members for the final decision. Five Conservative MPs put themselves forward as candidates: Justice Secretary Michael Gove, Chairman of the European Research Group Steve Baker, International Development Secretary Rory Stewart, and Chancellor of the Exchequer George Osborne. Former Mayor of London Boris Johnson, seen as the front runner by political analysts, surprised many commentators by choosing not to run after Gove withdrew his backing and announced his own candidacy.

In the first-round ballot, Osborne, gaining the support of nearly half of Conservative MPs, was placed first with Gove in third place, whilst Baker shocked pundits by coming third with 64 backers. Stewart was eliminated on the first ballot. Baker was eliminated in the second round of voting. Before the Conservative Party members were due to cast their votes, Gove withdrew from the contest on 11 July. Osborne was appointed party leader later that day, and Prime Minister on 13 July. He appointed Gove, Stewart and Baker to his Cabinet, respectively as Foreign Secretary (together with the office of First Secretary of State), International Trade Secretary, and Business Secretary.

If not for Gove's withdrawal, Conservative Party members would have directly elected a new Prime Minister for the first time.

Background
During the 2015 general election campaign, David Cameron, then leader of the Conservative Party and Prime Minister, announced that he would not seek a third term; he was therefore expected to stand down before the following general election — at that time, expected to occur in 2020 — although he spoke of serving a full term.

Throughout 2016 and particularly 2017, despite the strong economic situation Conservatives poll numbers began to decline. The Labour Party saw increasing support, in particular after scandals such as the Panama papers scandal, the Windrush scandal that precipitated the resignation of Home Secretary Theresa May and the Grenfell tower fire. Although the prospect of a no-confidence vote was still seen as very unlikely, Cameron came under increasing pressure to resign, especially as the next general election approached. After poor results in the 2018 local elections, sources within Westminster reported that Cameron intended to resign before the end of the year. On 24 May, to the shock of many pundits and commentators, Cameron announced his intention to resign as leader on 7 June, triggering a leadership contest.

The campaign was framed by whether candidates belonged to the pro-EU "One Nation" moderate wing of the party or the Eurosceptic right wing; initial speculation by some analysts was that a Eurosceptic would be more likely to win, citing earlier contests such as the 2001 leadership election and the 1997 leadership election, in which prominent Cabinet or Shadow Cabinet members, such as Kenneth Clarke, lost to less well-known Eurosceptics. Based on media speculation, the front runners on 29 June were Boris Johnson (Eurosceptic) and George Osborne (Pro-EU), with Johnson the early favourite. Johnson's candidacy was expected to be supported by Michael Gove, another prominent Eurosceptic. However, earlier that week, Osborne was leading by a narrow margin in opinion polls commissioned by The Times and by The Independent.

Gove, previously seen as a key ally of the Johnson campaign, announced his own candidacy three hours before nominations closed, stating that he had reluctantly come to the conclusion that Johnson could not "provide the leadership or build the team for the task ahead." Johnson subsequently withdrew from the leadership race. The Telegraph stated that Gove's actions in undermining Johnson's leadership aspirations constituted "the most spectacular political assassination in a generation." Gove's move was compared to the betrayals of fiction with, for example, Johnson's father, Stanley Johnson, quoting "Et tu Brute". Some of Johnson's allies subsequently began shifting their support to Osborne, because they perceived a "systematic and calculated plot" by Gove to remove their candidate from the race.

Economy
Osborne promised to abolish the highest rate of income tax, in line with an announcement he made as Chancellor in the 2018 budget. In order to reduce the deficit, Osborne said he would raise rates of indirect taxation, which would, in his view, "be fiscally responsible" whilst "maintaining one of the most competitive tax systems in the developed world". He also said that he would keep a "tight lid on spending, as [he had] done as Chancellor".

Gove pledged not to raise taxes, and said he would maintain spending cuts made since 2010. He promised to "cut red tape" for businesses, and opposed the HS2 rail project.

Stewart said that he would cancel the planned abolition of the highest rate of income tax, saying it would "force further cuts to already pressured public services and welfare programs". He said he would consider raising National Insurance to pay for further funding towards the NHS and education.

Baker promised to privatise Network Rail, Channel 4, and a number of quangos as a way to raise money for the government. This money would then be used to fund the abolition of diverted profits tax and the so-called "green levy", as well as a reduction in the higher rate of income tax to 30%. He expressed scepticism towards environmental regulation, and said that he would "review" the government's goal for 80% reduction in carbon emissions by 2050.

Immigration
Baker, the most right-wing of the four candidates, promised to reduce net migration into the tens of thousands. Gove supported the introduction of an "Australian-style" points-based immigration system, as soon as EU obligations allowed. Osborne did not frequently mention his stance on immigration, but said that he would make sure immigration "remains at sustainable levels". Stewart said that the government should balance "the utmost compassion and openness to immigrants" with "what is sustainable", but declined to elaborate.

Europe
Osborne promised to hold a simple in-out referendum on Britain's membership of the EU before the end of 2020, although he said he would campaign for the Remain side in the event. Gove and Baker also committed to this, although they said that they would campaign to leave. Stewart said that he did not consider a referendum on Europe a "top priority", but that he would be "open" to holding one if further powers were transferred to the European Union.

Osborne said that, prior to the referendum, he would try to renegotiate the terms of Britain's membership, so as to give the UK more legislative and regulatory control, and then have the referendum between remaining in the EU on renegotiated terms or leaving. In response, Baker suggested that any terms the EU might accept would be "half-baked, unsatisfactory and costly", and said that they would "do little to obstruct the [European] Commission's goals for ultimate integration". The New Statesman called Baker's remarks "dangerous...borderline conspiratorial".

Other issues
Stewart promised to hold a free vote on repealing the ban on fox hunting, as did Baker.

Osborne, Gove and Baker all promised to end the ban on new grammar schools.

Osborne and Gove suggested that they would recognise Jerusalem as the capital of Israel, after such an action was taken by US President Hillary Clinton the previous year.

Candidates' use of drugs
On 9 June, Gove admitted to taking cocaine 20 years prior, after allegations of his use of the drug were published by Owen Bennett in a biography titled Michael Gove: A Man in A Hurry. Gove apologised, but stated that he did not believe it "disqualified" him from the contest, and said that people should "move on". Immediately following the allegations, on 10 June, an Opinium poll suggested that Gove's support amongst Tory members had fallen from 23% to 16%, and there were rumours he was preparing to withdraw from the race. Stewart also admitted to taking illegal drugs whilst abroad on 12 June, but did not specify which drugs.

"Vote-switching"
Prior to the second ballot of MPs, Baker suggested that some of Osborne's supporters were planning to vote for Gove as a way to prevent Baker from reaching the final round, as they believed he would be harder to beat in the final members' ballot. One Baker supporter, Nadine Dorries accused the Osborne campaign of using "dark arts and dirty tricks" in order to win. Osborne responded by calling such claims "absurd" and said that "none of [his] supporters were in any way planning to manipulate the result of who enters the final round". On 12 June, Baker accused the Gove and Osborne campaigns of working together to prevent his election. James Forsyth of The Spectator said that Baker's attacks were "damaging the unity of the Conservatives" and were "completely unfounded and unhelpful". In any case, Baker's failed to make it into the top two in the second round, with his number of MP backers falling from 64 to 58, whilst Gove's increased from 61 to 80. Katy Balls, writing in The Telegraph said that it was "highly unlikely that so-called vote-switching played any role in Baker's failure to reach the final round", and that rather "his momentum, though impressive in the first round, stalled, in part no doubt due to absurd attacks like the vote-switching allegations levied against Gove and Osborne".

Osborne's association with BlackRock
On 9 June, it was revealed that in February 2017, Osborne started a new role as a part-time adviser to BlackRock, the world's largest fund manager, for a salary of £650,000 for one day a week. Although the Advisory Committee on Business Appointments did approve the job, Osborne's taking of the job was nonetheless controversial, and provoked concerns about potential lobbying. Osborne said that he had made "no specific policy decisions" relating to BlackRock, and reiterated the fact that it was permitted by ACOBA, although Baker said that "any Chancellor being so closely associated" with a fund manager "should be concerning". Gove said that "the Advisory Committee [on Business Appointments] approved the job" and that "whether or not there is something to be concerned about here is not for me to comment on".