British Prime Minister Liz Truss apologizes for ‘mistakes’ in mini budget



CNN

British Prime Minister Liz Truss apologized Monday for her controversial mini-budget that crashed the country’s currency, shook financial markets and led to her firing her finance minister and closest political ally.

In an exclusive interview with the BBC, Truss insisted she would lead her Conservative Party to the next general election, despite her government being under enormous pressure from investors and party members since the mini-budget was unveiled in late September.

The plan — which proposed unfunded tax cuts, exempting massive government loans and energy companies from a windfall — sent the pound tumble to its lowest level against the dollar in decades.

“I do want to take my responsibility and say sorry for the mistakes that were made. I wanted to help people with their energy bills to deal with the issue of high taxes, but we went too far and too fast,” Truss told Chris Mason from the BBC.

“I have appointed a new chancellor with a new strategy to restore economic stability.”

Last Friday, Truss replaced Finance Minister Kwasi Kwarteng with Jeremy Hunt, a former multi-function minister who has held the leadership twice.

Hunt has since undone many of her key leadership campaign promises. Just four days into the job, he said he would roll back “almost all” tax measures announced by his predecessor three weeks ago. The stunning turnaround would bring in £32 billion ($36 billion), he said.

A proposed reduction in the base income tax rate from April 2023 has been postponed “indefinitely”. And while the government has said it will still guarantee energy prices for households and businesses this winter, it will not commit to cap prices after next spring.

“No government can control the markets, but any government can provide assurance about the sustainability of public finances,” Hunt said. “The UK will always pay its way.”

Markets have calmed down somewhat in recent weeks, but it was only after massive intervention by the Bank of England that rumors leaked out that the mini-budget would be abolished and reports – which turned out to be true – that Kwarteng would be fired.

The moves amount to an erosion of Truss’s flagship “growth plan” and leave her in a dangerous political position.

The opposition Labor Party said Hunt’s statement highlighted how the government has made life more difficult for ordinary people as mortgage rates and other borrowing costs have risen in recent weeks.

“However, we must ensure that we have economic stability, and that must be my priority as Prime Minister. I acted in the national interest. I remain committed to the vision, but we will have to deliver it in a different way,” Truss told the BBC after being asked if her vision for Britain was “dead”.

Truss said she still believed in the “high growth, low taxes” formula she campaigned for in early September to win Conservative Party leadership – but said she acknowledged the UK is currently facing “very difficult circumstances”.

When asked if she was a “prime minister in name only” after appointing a secretary of the treasury who is “executing a plan a million miles from yours,” Truss replied, “I knew we had to act to keep the economic stability, which is why I appointed Jeremy Hunt.”

“I have been working very closely with the Chancellor in recent days to ensure we have the right package, but it would have been completely irresponsible not to act in the national interest the way I have. ,” she said.

Truss added it was “painful” to sack her “friend” Kwarteng as finance minister, but said she stood by her decision. She also apologized to her party lawmakers for her “mistakes”, but said she would “move forward” and focus on delivering for the UK.

Constitutionally, the next general election does not have to take place until January 2025. There is no guarantee that Truss will survive that long, although in the short term it would be difficult to remove the Conservatives’ fourth leader in just over six years due to party rules protecting her from a leadership challenge in the first year of her premiership. .

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