Minister says Liz Truss ‘enjoying’ new policy direction and welfare cuts are needed – UK politics live | Politics

Britain should prepare for new age of austerity, warns Simon Clarke

Simon Clarke, the levelling up minister and a key Liz Truss ally, has told the Times that the market chaos that followed the government’s tax cutting mini-budget would pass and warned that Britain should prepare for a new age of austerity.

He also said the prime minister was “enjoying having the chance” to enact policies that “she believes is right”.

Despite the turmoil in financial markets, Clarke said that Truss was “astonishingly resilient” and urged the government to channel the spirit of Margaret Thatcher to push ahead with their vision.

The 38-year-old said:

If I was to describe one word for Liz at the moment, it is purposeful. She knew – and this was certainly something we discussed during the summer – that this would not be a comfortable process.

Clarke added that for too long western countries have lived in a “fool’s paradise” and there would be cuts to government spending to ensure “full alignment with a lower-tax economy”.

Clarke said:

My big concern in politics is that western Europe is just living in a fool’s paradise whereby we can be ever less productive relative to our peers, and yet still enjoy a very large welfare state and persist in thinking that the two are somehow compatible over the medium to long term.

They’re not. We need to address that precisely because in the end, if we want those strong public services then we are going to have to pay for them. I think it is important that we look at a state which is extremely large, and look at how we can make sure that it is in full alignment with a lower tax economy.

Simon Clarke arrives for a cabinet meeting at 10 Downing Street, London.
Simon Clarke arrives for a cabinet meeting at 10 Downing Street, London. Photograph: Aaron Chown/PA

Key events

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Perhaps not the wisest move to describe Birmingham, the host city for this year’s Tory party conference, as a “dump”.

But that is what Daniel Grainger, the chair of the Young Conservative Network, did on Twitter before his post was swiftly deleted after a rebuke from the mayor of the West Midlands, Andy Street.

In an follow up Twitter post, Grainger said:

My tweet in relation to Birmingham was not about the city or its people. I’ve always enjoyed my visits to your city, but this morning I was greeted by an individual who threatened me with a mugging. I was angry and tweeted without thinking, I apologise for any offence caused.

I’d also like to directly apologise to @andy4wm, the @Conservatives and other representatives of Birmingham for my ill conceived comments. I have now deleted the tweet.

The RMT general secretary, Mick Lynch, has responded to comments made by the levelling up secretary, Simon Clarke, that for too long western countries have lived in a “fool’s paradise” and there would be cuts to government spending.

Responding from a picket line in Euston, Lynch told LBC:

The Tories must know all about living in a fool’s paradise because they are completely deluded about how this country works and what people need.

He added that Kwasi Kwarteng’s tax cutting mini-budget was an “ideological experiment” that would “blow up” in the government’s faces.

“The Tories must know all about living in a ‘fool’s paradise’ because they’re completely deluded about the way this country works.”

General Secretary of the RMT Union Mick Lynch blasts the Tories for conducting an ‘ideological experiment’ with their mini-budget.@BenKentish pic.twitter.com/R9Y4tVuSV1

— LBC (@LBC) October 1, 2022

Rowena Mason and Aubrey Allegretti report:

In recent years, Bill Gates held a roundtable discussion to which Kwasi Kwarteng was invited as a senior minister.

The billionaire was hosting the meeting, surrounded by high-profile guests. But according to observers, when Kwarteng turned up, he began to act as if he was the one in charge of the meeting “offering his opinion on everything” and “lecturing” Gates about the businessman’s own expert subject. It was “bizarre and embarrassing” to watch, according to one person with knowledge of the episode.

A tendency to arrogance – but also undoubted cleverness – is a common theme that many people who have worked with the new chancellor seem to report. This was the case even among fellow Tories, before he angered them with his politically and economically explosive mini-budget.

Read more here: Kwasi Kwarteng: an Eton tough nut with legendary self-confidence

The first pictures from an expected wave of cost of living protests throughout of the UK today have just appeared on the newswires.

The images are from a march in Leeds, with multiple people clutching banners calling for more funding for the NHS and supporting recent strike action by unions.

There are expected to be dozens of rallies throughout the day, with some people expected to set fire to utility bills in protest against soaring energy costs.

People take part in the Enough is Enough rally in Leeds. Danny Lawson/PA Wire
People take part in the Enough is Enough rally in Leeds. Photograph: Danny Lawson/PA
People take part in the Enough is Enough rally in Leeds. Danny Lawson/PA Wire
People take part in the Enough is Enough rally in Leeds. Photograph: Danny Lawson/PA

Robert Booth

Robert Booth

UK householders are poised to set fire to their utility bills on Saturday, in a wave of cost of living protests timed to coincide with the jump in gas and electricity unit prices that will cause bills to soar.

In what organisers forecast will be the largest nationwide protests against an economic crunch, which got worse this week with money market chaos and mortgage rate rises looming, dozens of rallies will be staged from Plymouth to Aberdeen, while postal and railway workers also strike.

On the day the government’s £150bn energy price guarantee comes into effect, which allows average household bills to hit £2,500 a year, up from £1,971, people are expected to torch bills in Birmingham, Bradford, Brighton and London.

Read more: Britons to burn their bills in weekend wave of cost of living protests

Tens of thousands of railway workers are taking part in a mass strike will cause some of worst rail disruption of the year.

Large parts of the country are without any rail services, with only 11% of normal schedules in operation.

The timing coincides with the London Marathon on Sunday, leaving participants struggling to reach the capital for the run, PA reports.

The RMT general secretary, Mick Lynch, speaking from a picket line at Euston station on Saturday, was pressed on how the union would “justify” causing disruption to a “major charity event”.

He told BBC Breakfast that union members did not want to cause the public difficulties and said it was the Tory party conference that was being targeted, rather than the marathon.

Asked whether he would apologise to the public, he said:

Absolutely. We don’t want to inconvenience the public and we’re really sorry that that’s happening.

But the government has brought this dispute on. They (put) the challenges down to us, to cut our jobs, to cut our pensions and to cut our wages against inflation.

Network Rail’s chief negotiator, Tim Shoveller, described the strikes as a “huge own goal” that would result in “less money to spend improving the railway”.

Below are some of the latest pictures from the newswires the picket line in Leeds which has been visited by Labour MP Richard Burgon.

The Labour MP for Leeds East, Richard Burgon, joins rail workers on the picket line in Leeds.
The Labour MP for Leeds East, Richard Burgon, joins rail workers on the picket line in Leeds. Photograph: Danny Lawson/PA
Laura Dickinson, Enough is Enough regional co-ordinator for Yorkshire, joins rail workers on the picket line in Leeds.
Laura Dickinson, Enough is Enough regional co-ordinator for Yorkshire, joins rail workers on the picket line in Leeds. Photograph: Danny Lawson/PA
Rail workers on the picket line in Leeds.
Rail workers on the picket line in Leeds. Photograph: Danny Lawson/PA

Devolved governments demand urgent meeting with Kwasi Kwarteng

The UK devolved governments have called for an urgent meeting with Kwasi Kwarteng and urged him to “reverse the damage” caused by his tax-cutting mini-budget.

The joint letter from the finance ministers of Wales, Scotland and Northern Ireland, warns that the chancellor has taken a “huge gamble” on the health of the economy.

It adds that the UK was already facing “severe economic upheaval” and that the government has made matters worse by announcing tax cuts “for the most wealthy”, without saying how it would be paid for.

The letter continues that they are concerned about reports that spending cuts could soon be enacted that this could have implications for “devolved budget settlements”.

The three devolved governments urge Kwarteng to provide further targeted support to households and businesses during the cost of living crisis and that further government funding is needed to support public services.

NEW. The UK devolved governments are seeking an urgent meeting with Kwasi Kwarteng to discuss immediate action to REVERSE the damaging effects of the mini-budget, highlighting its profound impact, stating it’s “a huge gamble on public finances and the health of our economy” 🏴󠁧󠁢󠁳󠁣󠁴󠁿 🏴󠁧󠁢󠁷󠁬󠁳󠁿 pic.twitter.com/cxIPoABEM9

— Antonello Guerrera (@antoguerrera) October 1, 2022

The Green party has said its call for a wealth tax on the richest 1% in the country is to “make our society more equal”.

At the party’s annual conference in Harrogate, co-leader Carla Denyer outlined an emergency £75bn tax package targeting polluters and the country’s wealthiest individuals, PA reports.

The money would be used to fund a nationwide insulation and renewable energy programme, the party has said.

Appearing on BBC Breakfast on Saturday, co-leader Adrian Ramsay said the policy could remedy some of the “economic chaos” wreaked by the government’s mini-budget.

Ramsay said:

We’re calling for this at a time of economic and political crises. We’ve seen economic chaos caused by a mini-budget that has been making our society more unequal.

This is about trying to make our society more equal.

Introducing the policy at the party conference, Denyer said:

We’ve got the leakiest homes in Europe – losing huge amounts of energy through badly sealed windows and poorly lined walls.

We could be saving hundreds, thousands of pounds through insulation – reducing energy wastage, cutting bills and emissions. It really isn’t rocket science. The cheapest bill is the one you don’t have to pay.

The Danish prime minister Mette Frederiksen has arrived at Downing Street for a meeting with Liz Truss, PA reports.

Frederiksen was greeted outside by Truss – who ignored shouted questions from reporters of “are you bringing back austerity?” – slightly after 9am.

The pair shook hands on the doorstep of 10 Downing Street accompanied by Larry the cat.

Their meeting then moved inside, where they posed briefly for photographs in a state room.

Liz Truss, left, greets Denmark’s prime minister outside 10 Downing Street, in London.
Liz Truss, left, greets Denmark’s prime minister outside 10 Downing Street, in London. Photograph: Alberto Pezzali/AP

Britain should prepare for new age of austerity, warns Simon Clarke

Simon Clarke, the levelling up minister and a key Liz Truss ally, has told the Times that the market chaos that followed the government’s tax cutting mini-budget would pass and warned that Britain should prepare for a new age of austerity.

He also said the prime minister was “enjoying having the chance” to enact policies that “she believes is right”.

Despite the turmoil in financial markets, Clarke said that Truss was “astonishingly resilient” and urged the government to channel the spirit of Margaret Thatcher to push ahead with their vision.

The 38-year-old said:

If I was to describe one word for Liz at the moment, it is purposeful. She knew – and this was certainly something we discussed during the summer – that this would not be a comfortable process.

Clarke added that for too long western countries have lived in a “fool’s paradise” and there would be cuts to government spending to ensure “full alignment with a lower-tax economy”.

Clarke said:

My big concern in politics is that western Europe is just living in a fool’s paradise whereby we can be ever less productive relative to our peers, and yet still enjoy a very large welfare state and persist in thinking that the two are somehow compatible over the medium to long term.

They’re not. We need to address that precisely because in the end, if we want those strong public services then we are going to have to pay for them. I think it is important that we look at a state which is extremely large, and look at how we can make sure that it is in full alignment with a lower tax economy.

Simon Clarke arrives for a cabinet meeting at 10 Downing Street, London.
Simon Clarke arrives for a cabinet meeting at 10 Downing Street, London. Photograph: Aaron Chown/PA

The Welsh secretary, Sir Robert Buckland, has said the government is “absolutely committed” to fiscal responsibility after the turmoil in financial markets following chancellor Kwasi Kwarteng’s £45bn mini-budget tax cut.

After a week in which the pound slumped to an all-time low against the dollar, Buckland said ministers were committed to increasing the tax yields needed to pay for public services, PA reports.

He told the BBC Radio 4 Today programme:

We have seen weakness in the pound, the yen, the euro against the dollar over the past few months. I don’t think it would be fair to say that Friday was the sole cause of the turbulence.

There has been turbulence, I am not denying that, but what I am seeing is, as we look more carefully at this package, there is that commitment to bring in the tax yields that we need to pay for our public services and our public spending commitments, but at the same time signal that this country needs to grow the economy to pay for our public services in the future. I make no apology for that.

He said the chancellor would be setting out further details when he publishes his medium-term fiscal plan on November 23.

Buckland added:

You will see more as to the government’s medium-term plan which I think will give a high degree of reassurance to markets that, like its predecessors, this government is absolutely committed to fiscal responsibility.

Jedidajah Otte

Jedidajah Otte

Voters, members of the Conservative party and experts reacted with dismay to Kwarteng’s “fiscal event” last Friday, when he announced that the top tax rate of 45% would be abolished.

But what do high earners who benefit from the tax cut think of it? We spoke to some to find out.

‘I feel sick and ashamed’

“I’m furious! I grew up in a poor household and have never forgotten it. I have worked hard to be a good earner, but this doesn’t mean I believe I’m better than those who aren’t doing so well. This – at a time when people are already suffering so much. Energy prices. NHS. Education. Transport. All problems which need urgent attention. Not to mention the lack of legal aid. The low fees paid to legal aid practitioners. Lack of affordable housing, childcare, etc.

“Truss and Kwarteng seem to have no understanding or sense. How can the basics be paid for? How do they think the economy will grow? Why don’t they care about poverty? I feel sick and ashamed. I will give it to charity: to the NSPCC, because more children will be neglected, and others. I didn’t ask for this. I don’t need it. I don’t want people to think I’d vote for such a stunt. It’s appalling. I am so sorry for our country. It’s being ruined.” Claire, 60, a solicitor from Dorset

‘High taxes disincentivise hard work’

“I think it’s excellent the Tories scrapped the top rate, it felt like Christmas. On its own a 45% rate is already high, but once national insurance, council tax and student loan repayments are factored in it is one of the heaviest tax burdens in the world. Such a system disincentives hard work and financial success, discouraging people from taking business risks that would benefit the economy. At the same time, the efficiency and quality of public services is laughably bad. I’ll invest most of it, spend some on the increased cost of living, and put the rest towards a new house.”
Patrick, 36, a risk manager from Surrey

Read more here:

The Green party is midway through its annual conference today and co-leader Adrian Ramsay is on BBC Breakfast.

He says the party’s call for a tax on the richest 1% in society would pay for a green fund aims to “make our society more equal”.

Carla Denyer and Adrian Ramsay clapping during the party’s conference in Harrogate yesterday.
Carla Denyer and Adrian Ramsay, co-leaders of the Greens, during the party’s conference in Harrogate yesterday. Photograph: Ian Forsyth/Getty Images

Under the plans the wealthiest people in the country would contribute 1% of their money to a “fund to create a greener society”.

We’re calling for this at a time of economic and political crises.

We’ve seen economic chaos caused by a mini-budget that has been making our society more unequal.

This is about trying to make our society more equal.

Robert Booth

Robert Booth

UK householders are poised to set fire to their utility bills later, in a wave of cost of living protests timed to coincide with the jump in gas and electricity unit prices that will cause bills to soar.

In what organisers forecast will be the largest nationwide protests against an economic crunch, which got worse this week with money market chaos and mortgage rate rises looming, dozens of rallies will be staged from Plymouth to Aberdeen, while postal and railway workers also strike.

Those wielding lighters include the backers of Don’t Pay UK, a grassroots movement that has received almost 200,000 pledges from householders prepared to cancel their direct debits unless the government does more to protect the poorest families.

The protests are being coordinated between multiple community organisations and trade unions in a bid to maximise impact.

We will cover the protests live in this blog later in the day.

PM admits ‘disruption’ following mini-budget

Harry Taylor

Like the chancellor, the prime minister has used a Saturday newspaper column to defend the government’s course of action.

In the face of fierce criticism, including a stinging rebuke from the IMF, Liz Truss has admitted that the mini-budget delivered by her government last week did cause “disruption”, after it was followed by a series of economic shocks, including the pound falling to an all-time low against the dollar.

Writing in the Sun, Truss failed to address the changes to the 45p rate, or the scrapping of the cap on bankers’ bonuses, which was also included in Kwarteng’s announcements. She said:

For too long we have been stuck debating how to divide up the economic pie, rather than grow the pie so everyone has a bigger slice.

The status quo is not working. For too long we have been held back by low growth and high taxes. We need to get things done in this country more quickly.

So I am going to do things differently. It involves difficult decisions and does involve disruption in the short term.

Not everyone will like what we are doing, but I want to reassure the public that the government has a clear plan that I believe is right for the country.

On Friday, she had told broadcasters:

I recognise there has been disruption but it was really, really important we were able to get help to families as soon as possible.

What is important to me is that we get Britain’s economy back on track, that we keep taxes low, that we encourage investment into our country and that we get through these difficult times.

Kwarteng: I had no other choice

Good morning. As the fallout from the chancellor’s mini-budget continues, with the pound tumbling and markets reeling, Kwasi Kwarteng has attempted to defend the government’s course of action.

Writing in the Daily Telegraph, he said:

The British taxpayer expects their government to work as efficiently and effectively and possible, and we will deliver on that expectation.

Not all the measures we announced last week will be universally popular. But we had to do something different.

We had no other choice.

His announcements just over a week ago included a cut in income tax from 45p to 40p in the pound for the highest earners. Other taxpayers received a 1p cut in income tax and will get money from a U-turn in the rise in national insurance. The chancellor said they would all help to increase growth.

However, there was a strong market reaction to the package, which amounted to the biggest tax cuts in 50 years. The Bank of England subsequently spent billions of pounds buying government debt to shore up pensions schemes. It has also indicated that interest rates are like to rise significantly, which has led to jumps in mortgage rates and lenders pulling many deals.

Responding to the markets’ reaction, Kwarteng added:

Even in the face of extreme volatility in global markets, with major currencies wrestling an incredibly strong US dollar, we will show financial markets and investors that our plan is sound, credible and will work to drive growth.

Stick with us throughout the day for all the latest political news and developments.





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