‘It’s the right plan’: Prime Minister Liz Truss won’t abandon mini-budget amid criticism
Liz Truss has insisted it is ‘simply wrong’ that she and her chancellor Kwasi Kwarteng have devised a ‘reverse Robin Hood’ mini-budget that disproportionately benefits the wealthy.
Breaking days of silence as markets turmoil, the Prime Minister claimed his mini budget – which abolishes the top rate of income tax and sparked days of economic turbulence – was the ‘right plan’ and has “put this country on a better trajectory for the long term”.
Her comments came as she was accused by former Bank of England Governor Sir Mark Carney of ‘undermining economic institutions’ and ‘working against the grain’ with the bank, after she was forced to make an emergency intervention in the gilt market to prevent a crisis in the UK’s main pension funds.
The bank’s intervention on Wednesday – to spend billions on 30-year British government bonds – supported the pound with its biggest jump since mid-June, but the value of the pound had again fallen by 1% to $1.0775 on Thursday morning as the dollar recovered from a recent dip.
‘It’s about getting Britain moving’: Liz Truss defends tax cuts
On BBC Radio Tees, Liz Truss heard of a listener, Diane, who had to sell her 25-year-old house due to the cost of living crisis.
Asked how tax cuts for the wealthy would help people like Diane, the Prime Minister replied: ‘We are cutting taxes across the board because we faced the highest tax burden in Britain for 70 years and it caused a lack of economic growth, and without growth, we don’t get the investments, we don’t get the jobs that we need, which helps local communities across the country.
“We are also reversing the National Insurance increase. We are also reducing the base rate. So we are reducing taxes at all levels because the tax burden was too high.
Ms Truss was also asked about child poverty in the North East of England, which has increased over the past 12 years of Conservative government in Westminster. She replied: ‘Well, the first thing we need to do to help solve the problems that families are facing is to help more people find work and create those good paying jobs and that’s exactly what what our mini-budget is about.
“It’s about getting Britain moving. It’s about getting the infrastructure built. And it’s about attracting investment across the country, including the Northeast.
Liz Truss defends 45p tax cut for top earners to protect people from high energy bills
Andy GregoireSeptember 29, 2022 10:01 am
Truss suggests Putin is responsible for the current economic crisis in the UK
Liz Truss has suggested Vladimir Putin’s invasion of Ukraine was responsible for the current economic turmoil in the UK.
Asked if the market turmoil was down to the mini budget, she told BBC Radio Bristol: “It’s about Putin and the war in Ukraine – that’s why we’re facing prices of energy so high… It’s very difficult in times of storm in the international markets”.
Claiming that energy bill support was the bulk of the mini-budget, she added: ‘It’s about curbing inflation. It’s a global problem – and I think it would be helpful if you looked at the situation in other countries as well.
Pressed on BBC Radio Stoke about rising mortgage payments due to her borrowing-fueled tax cuts, Ms Truss said: ‘We need to borrow more this winter for the energy crisis we are facing.
Again emphasizing ‘global issues’, she added: ‘Interest rates are the business of the Bank of England. The fact is that interest rates are rising all over the world.
Andy GregoireSeptember 29, 2022 9:43 a.m.
Watch: Truss asked “Where have you been?”
Appearing on regional radio shows this morning, Liz Truss was immediately faced with questions about her silence for the past four days as her mini-budget caused economic turmoil.
“Where were you?” : Liz Truss responds to concerns over mini budget disaster
Andy GregoireSeptember 29, 2022 09:40
Shut up to ‘complete denial’, say Lib Dems – calling for Tory conference to be canceled
Our political correspondent Adam Forest reports:
Liz Truss “totally denies the damage caused by her reckless and out of touch budget,” said Liberal Democrat deputy leader Daisy Cooper.
Lib Dem leader Ed Davey has called on the Prime Minister to cancel the Tory Party conference this weekend and remind Parliament to vote to fix the ‘botched’ mini budget
Andy GregoireSeptember 29, 2022 09:33
Liz Truss insists she ‘believes in sound money’
Liz Truss has insisted she still believes in ‘sound money’ after her Chancellor’s £45billion tax cut package sent financial markets into turmoil.
The Prime Minister told BBC Radio Bristol: “I believe in sound money. I point out that interest rates are rising around the world. The Federal Reserve raised interest rates. It is a worldwide phenomenon. »
Pressed on whether people’s pensions were safe, Ms Truss said: ‘The Bank of England does it and it does it very well.
Andy GregoireSeptember 29, 2022 9:21 a.m.
Pound down 1% after biggest jump since mid-June following Bank of England intervention
The British Pound and Euro fell this morning and the US Dollar recovered from a recent decline as relief from the Bank of England’s intervention in bond markets faded.
Britain’s currency jumped the most since mid-June on Wednesday after the bank announced its emergency response to support the gilt market.
But amid nagging doubts over Britain’s economic management and global growth outlook, the pound was 1% lower at $1.0775 at 9am – down from $1.0830 at the previous close – while the euro also weakened 1% to $0.9642, and the dollar regained its footing.
Additional Reuters reports
Andy GregoireSeptember 29, 2022 9:13 a.m.
Truss admits tax cuts have a ‘disproportionate effect’
Liz Truss admitted there was a ‘disproportionate effect’ to tax cuts announced by her Chancellor, as she did not say directly there was evidence cutting taxes on the wealthiest reduced inequality .
Asked how she was creating a fairer tax system, Ms Truss told BBC Radio Nottingham: ‘The reality is people have lower taxes at all levels, which we do – everything from l national insurance to corporation tax to income tax – helps everyone, because it helps the economy grow.
“And for too long the debate in this country has been about distribution, rather than how we grow our economy… It’s not necessarily popular to keep corporate taxes low, but it is important that we do this because I want to make sure that we attract investment in this country.”
The Prime Minister admitted: “We’ve cut those taxes across the board, and of course the better off tend to pay more tax, so there’s a disproportionate effect there.”
When asked if there was any evidence that cutting taxes on the wealthiest reduced inequality, she replied: “There is a lot of evidence that if you have very high taxes they lead to lower economic growth. .”
Andy GregoireSeptember 29, 2022 09:08
Truss says ‘it’s not true’, his mini-budget is ‘the reverse of Robin Hood’
Liz Truss has insisted it ‘simply isn’t true’ that she and her chancellor have devised a ‘reverse Robin Hood’ mini-budget that disproportionately benefits the wealthy.
When asked “which piece?” Ms. Truss stumbled for a moment before saying: “The entirety of what you just said”, before adding that “most of the package we have announced is support on energy bills”.
Andy GregoireSeptember 29, 2022 08:49
Truss told the Bank of England ‘put out your fire’
Liz Truss faced comments from BBC Radio Kent listeners, who asked questions such as ‘what the hell were you thinking?’, ‘how can we trust the Tories again with our economy’, and “Are you ashamed of what you did?”
asked “are you [ashamed]by presenter Anna Cookson, the Prime Minister repeated her earlier remarks that she had ‘taken action’ to protect people from energy bills of up to £6,000.
But pressed that her support had been ‘nullified’ by inflation and fears over mortgages and pensions sparked by her mini-budget, Ms Truss said: ‘It will reduce inflation by up to 5%… the measures that we are taking on energy should bring inflation down to 5% and we are also taking action to grow the economy because we were facing an economic downturn…because of Putin’s dreadful war in Ukraine.
Telling her ‘it doesn’t normally happen’ for the Bank of England to make an emergency response as it did yesterday, Ms Truss continued: ‘We are working closely with the Bank of England .”
But Ms Cookson replied: ‘They put out your fire, to be fair.’
The Prime Minister replied: “We have seen difficult markets around the world due to the very difficult international situation that we are facing. And what our government has done is we have taken decisive action, first on energy bills…”
Told it’s the ‘other decisive action people are worried about’, Ms Truss insisted the Government ‘has done the right thing by taking urgent action to deal with inflation, deal economic downturn and dealing with high energy bills, and of course that means making tough decisions.
Andy GregoireSeptember 29, 2022 08:43
Kwarteng is working ‘very, very closely’ with the Bank of England, says Truss
Chancellor Kwasi Kwarteng is working “very, very closely” with the Governor of the Bank of England, said Liz Truss.
“We are going through very difficult economic times. We are facing this globally,” the Prime Minister told BBC Radio Leeds. “Of course, many measures that we have announced will not happen overnight. We will not see growth happen overnight.
“What’s important is that we put this country on a better long-term trajectory.”
Andy GregoireSeptember 29, 2022 08:29