British Prime Minister Liz Truss has said she should have done more to “set the stage” better to try to minimize the market reaction to her recent mini-budget, which saw the pound hit record lows and that government borrowing costs soared.
Key Points:
- Ms Truss says she did not discuss the tax plans with her entire cabinet
- Ultimately, it was a decision of his finance minister, he says
- He says they didn’t have time to go through the Office of Budget Responsibility process
On the first day of her ruling Conservative Party’s annual conference, Ms Truss, in power for less than a month, struck a softer tone as she tried to reassure the public she would look after them through a difficult winter and beyond.
But he stuck to his “growth plan” which has been criticized by investors and economists for setting out billions of pounds of extra spending while offering very little detail on how it would be paid for in the short term.
“I understand your concerns about what has happened this week,” he told the BBC’s Sunday program with Laura Kuenssberg.
“I stand by the package that we announced and I stand by the fact that we announced it quickly because we had to act, but I accept that we should have prepared the ground better,” he said.
Ms Truss still has less than a month left in her role as Prime Minister. (News video)
According to the Prime Minister, her Cabinet of Prime Ministers was not informed in advance that the government planned to abolish the top rate of tax, with the decision taken by Finance Minister Kwasi Kwarteng.
“No we didn’t, that was a decision the chancellor made,” Ms Truss told the BBC when asked if her entire cabinet was informed of the planned scrapping.
“When budgets are developed, they are developed in a very confidential manner.”
Opposition, public horrified by the tax proposals
Markets plunged in response to the package, and the Bank of England staged an emergency intervention to rescue struggling pension funds, setting the stage for a difficult four-day meeting in Birmingham.
Appearing on the BBC immediately after Ms Truss, senior Tory MP Michael Gove called the plans “deeply” wrong and said a “course correction” would be needed.
Before Sunday, Ms Truss broke almost a week of silence on Thursday with a round of interviews on regional BBC stations, when her awkward pauses generated almost as many headlines as her defense of the plan.
He then followed that up with more interviews and a newspaper article on Friday in which he vowed to continue with the policies but get an “iron grip” on public finances.
“Of course we have to reduce debt as a proportion of GDP in the medium term, and I have a plan to do that,” the underfire leader reiterated on Sunday.
The live TV appearance was the first in front of a UK national audience since Kwarteng unveiled the controversial proposals on September 23, and comes after a series of polls showed a dramatic drop for his party .
A YouGov poll on Friday found that 51 per cent of Britons think Ms Truss should resign, and 54 per cent want Mr Kwarteng gone.
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