THE first time I saw the Kwasi Kwarteng speak, he was telling an audience of Tory Party members that Britain needed to slash taxes back to “pre-war” levels.

The war he meant was World War I. Now he is business secretary.

If a Cabinet minister wants to cut government back to pre-NHS days, what does that mean for Boris Johnson’s “levelling-up” agenda?

Kwarteng was first elected in 2010, becoming a key member of the party’s “free-marketeer” right, which was agitating for David Cameron to make less pretence of being a “soft” Tory and get harder on cuts and deregulation.

I saw him speak in 2012 at a fringe meeting at the party conference in Birmingham.

The meeting was co-organised by the Thatcherite Adam Smith Institute and Jersey Finance, the lobbyists for the investment industry in the Channel Islands tax haven.

The tax-avoidance lobbyists paid for room hire and refreshments and Kwarteng played their favourite tune: he said only lower taxes could save the economy and that only the “low tax of Britain before World War I” could really drive the kind of growth we need.

So Kwarteng wants to go back to 1913. Back to when life expectancy was 52. Back to before the NHS. Back to a school leaving age of 12.

Kwarteng is a clear thinker and a direct speaker, so I do think he meant this.

It appealed to the Tories in the room, because going back to pre-WWI-style government is simultaneously anti-tax and has a strong dash of Downton Abbey nostalgia.

Kwarteng told the delegates, drinking free wine supplied by Jersey Finance in a packed fringe meeting, that the government needed to take “tough, courageous and brave” decisions to cut benefits and “liberalise the labour market for lower-paid workers” — presumably by loosening minimum wage rules.

Kwarteng joined newly elected MPs Priti Patel, Dominic Raab and Liz Truss to write Britannia Unchained, a 2012 book aimed at pushing Cameron’s government rightwards.

Johnson has now given most of the Britannia Unchained authors Cabinet-level jobs in his new government.

Johnson has committed to a “levelling-up” agenda, promising to make key government investments in an attempt to hold on to blue-collar votes, especially in seats in northern England and the Midlands. At the same time he is relying heavily on the most economically “dry” MPs.

Famously, Britannia Unchained declared: “The British are among the worst idlers in the world. We work among the lowest hours.”

There is likely to be some tension in the government over hanging onto votes of working people and seeing those voters as lazy slackers who need to work harder for less.

Kwarteng, Patel, Raab and Truss also wrote another book, After the Coalition (2011), which argued the Tories should push hard to the right once they were able to ditch their Lib Dem partners.

In the book Raab recommended introducing NHS charges and Patel recommended prisons should “be tough, unpleasant and uncomfortable places” run by private corporations.

Kwarteng took responsibility for the economics issue: “First, we need to stop the government spending so much in the future. As a rule of thumb, state spending should never grow faster than the economy as a whole.

“The recipe for increasing growth is not complicated, even if the implementation may take political will. Businessmen and entrepreneurs can drive growth when they are not held back by high taxes and excessive regulation.”

Kwarteng was pushing — successfully — for Cameron’s Conservatives to keep to the low-taxes-for-the-rich, low-spending-for-the-poor “austerity” formula.

It suggests Kwarteng will be another voice in the government pushing to slash spending and regulation to pay for the Covid-19 crisis.

Kwarteng is also for slashing tax and regulation for business and he identifies business closely with finance. 

Before becoming an MP Kwarteng had worked for Odey Asset Management, a hedge fund run by Tory donor Crispin Odey.

When he was first an MP in 2011, Kwarteng moonlighted with part-time work as a consultant to Odey, being paid £10,000 every six months — although he dropped the job once it got some press attention.

His entry in the Register of MPs’ Interests shows that he got £16,500 in donations from investment firms to help his 2019 general election fighting fund, so he is still likely to be very oriented to finance and investment — though he did get one from an industrialist, taking £4,000 from Majid Jafar, boss of Middle East energy firm Crescent Petroleum.

What does Kwarteng’s promotion mean — what we can expect Johnson’s government in light of it?

Another voice from the Britannia Unchained group at Cabinet level will mean more calls for slash-and-burn of taxes, spending and regulation as we come out of the Covid-19 crisis.

However, while Johnson leans heavily on these headbangers, he is not one of them: I think we should take the PM’s “levelling-up” agenda seriously.

I don’t mean we should believe it is really some kind of genuine one-nation Tory approach, but I do think he wants to do more than simply do “austerity 2.”

He will want to have targeted spending to try to buy Tories electoral support, even while generally going for a neo-Thatcherite approach.

I think government investment in high-profile projects that enrich key corporate supporters or help specific Tory MPs’ constituencies alongside general cuts are very likely.

I also think hybrid models of investment and deregulation — like “enterprise zones” that both attract government spending and include localised deregulation — seem very possible.