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UK’s under-fire finance minister vows to ‘stay the course’

UK’s under-fire finance minister vows to ‘stay the course’
UK’s under-fire finance minister vows to ‘stay the course’

Chancellor of the Exchequer Kwasi Kwarteng attends the annual Conservative Party conference in Birmingham October 2, 2022. — Reuters pic

Monday, 03 Oct 2022 5:37 AM MYT

LONDON, Oct 3 — Britain’s beleaguered finance minister is set Monday to vow no retreat on the Conservative government’s plan to pay for controversial tax cuts with billions more in borrowing.

Chancellor of the Exchequer Kwasi Kwarteng will address the ruling Tories’ annual conference a day after Prime Minister Liz Truss admitted communication errors in how the plan had been presented on September 23, without conceding the need for any changes.

“We must stay the course. I am confident our plan is the right one,” Kwarteng will say in his speech to party members gathered in Birmingham, according to the Conservatives.

He will promise “a new economic deal for Britain… backed by an iron-clad commitment to fiscal discipline”.

Truss and Kwarteng have refused to rule out cuts to spending, including for benefit claimants, in the middle of Britain’s worst cost-of-living crisis in generations.

At the same time, their plan comprises cuts in taxes for the richest and lifting a cap on bankers’ bonuses.

With Truss’s administration not even a month old, the right-wing policy blitz has bombed with the electorate, according to polls which show the opposition Labour party opening up a mammoth lead.

Many senior Tories in Birmingham are nervous.

Raising borrowing to pay for the £45 billion (RM231.8 billion) in tax cuts is “not Conservative”, former minister Michael Gove told the BBC Sunday, just as Truss left the studio after her own interview.

Gove, ex-prime minister Boris Johnson’s right-hand man in the 2016 Brexit campaign, said he was “profoundly” worried and refused to rule out voting against the plan in parliament.

Others who, like Gove, backed Rishi Sunak — Truss’s rival in the recent Tory leadership race — have also threatened to vote it down, raising the prospect of a major battle in the House of Commons.

Markets had tanked in response to the plan, and the Bank of England last week staged an emergency intervention to bail out embattled pension funds.

Truss told the BBC she had not discussed axing high-earners’ 45 per cent tax rate with her cabinet, and appeared to distance herself from the move by claiming “it was a decision that the chancellor made”.

That prompted an immediate rebuke from Johnson loyalist Nadine Dorries, who accused the new prime minister of “throwing (Kwarteng) under a bus on the first day of conference” on Sunday.

The stakes are rising for Truss as she prepares to close the party conference with a keynote speech on Wednesday.

One YouGov survey Friday found 51 per cent of Britons think she should resign — and 54 per cent want Kwarteng to go.

Several other polls in recent days showed a Labour lead of up to 33 points over the Tories — its biggest since the heyday of former Labour prime minister Tony Blair in the late 1990s. — AFP

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