Potential council tax rises could constitute the straw that breaks the camel’s back for UK residents struggling with the cost of living.
Here’s the team on Good Morning Britain, discussing whether people will end up living in prison – rather than their homes – serving sentences for non-payment:
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UK Chancellor Jeremy Hunt has said “eye-watering” decisions on tax increases and public service cuts will be made in his Budget on Thursday. But can we trust him to make the right choices?
Labour’s Chris Bryant doesn’t think so. On the BBC’s Politics Live, he pointed out just a few of the financial disasters inflicted on the UK by a Conservative government and raised fears that Hunt will demand more from the people who have the least.
Watch out for the party political nitpicking from Conservative Siobhan Baillie, who doesn’t have a leg to stand on but still tries to undermine the solid points Bryant makes.
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For those of you who love the detail, here’s a full video clip of Liz Truss’s press conference this afternoon (Friday, October 14) in which she u-turned on cutting Corporation Tax and… didn’t do much else.
If you stick it out to the end, you can enjoy the sound of a stunned reporter asking, “Aren’t you going to say sorry?”
It’s the highlight of the event.
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Liz Truss says she wants growth but went too far in her mini-budget.
She’ll keep the increase in Corporation Tax now, raising an extra £18 billion per year.
She’s asked former Health Secretary Jeremy Hunt to become Chancellor (so he’ll do as much damage to the Treasury as he did to the NHS).
She’s keeping the energy price “guarantee” (note: no longer a cap).
“This is difficult but we will get through this storm,” she says – not for a moment admitting that she is responsible for it.
She goes to questions – and is immediately asked why she has junked the Corporation Tax cut on which she was elected Tory leader. She evades answering.
Second question: the 45p tax cut was her idea, so was the Corporation Tax cut. But Kwarteng had to go. Why does she have to stay? She evades answering.
Third question: what credibility does she have to continue governing? She puts it all on Jeremy Hunt, the new Chancellor, and says they have to “deliver the mission in a different way”.
Fourth question: will she apologise to her party for having “totally trashed” its “reputation for economic competence”. She evades answering.
And she leaves. As she goes, a voice can be heard very clearly asking…
“Aren’t you going to say sorry?”
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First, here’s a selection of Conservative MPs (including a wonky-spectacled Chancellor Queasy Kwarteng) working hard to justify themselves:
Now let’s see what their own voters think of them…
… Oh dear.
The best that can be said is that they all approve of the tax u-turn. But that means they’re admitting that their government – that they chose – got their first big decision wrong.
And some of the comments were a lot less positive.
And Kwasi Kwarteng’s speech didn’t get the ovation he would have wanted. Most people stayed in their seats and This Writer has a suspicion that many of them didn’t even bother to clap.
I think these Tories are in deep, deep trouble. But they’re all working hard to avoid admitting it.
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Liz Truss and Kwasi Kwarteng: 10 days ago, cutting the 45p tax rate was a proud announcement for them. Now it has become a millstone around their collective necks.
A plan to cut the 45p top tax rate for high earners has been scrapped by Chancelllor Kwasi Kwarteng just 10 days after he announced it.
Kwarteng reversed the decision after a weekend of growing controversy surrounding the policy in which his prime minister, Liz Truss, appeared to try to throw him “under a bus”:
Note that she initially tried to defend the policy using the language of her bosses in right-wing think tanks like the Institute for Economic Affairs, saying it was an attempt to simplify the tax system and lower the tax burden.
But then, realising that interviewer Laura Kuenssberg was saying the policy was hugely unpopular with the public, she backtracked, saying that it was a policy devised by Kwarteng, which was not properly discussed in Cabinet.
And now, as Kwarteng prepares to give his speech to the Tory Party Conference, we have this:
Apparently there was a rebellion within the Conservative Parliamentary Party over the “toxicity” of cutting the top rate of tax amid a cost-of-living crisis for the vast majority of people in the UK.
And Truss was afraid that the rebellion would dominate the conference.
It’s a huge u-turn for a prime minister who had claimed she was “prepared to be unpopular”. It seems she wasn’t prepared for it after all.
The BBC has reported that Kwarteng said the proposal
had become “a massive distraction on what was a strong package”.
“We just talked to people, we listened to people, I get it,” he added.
Mr Kwarteng told BBC Breakfast the proposal was “drowning out a strong package”, including support for energy bills, and cuts to the basic rate of income tax and corporation tax.
Asked whether he owed people an apology, he said: “We’ve listened to people. And yeah, there is humility and contrition in that. And I’m happy to own it.”
On how the decision was made, he said: “The prime minister decided not to proceed with the abolition of the rate.”
However, pressed on whether it was her U-turn, Mr Kwarteng added: “No, we talked together, I said this is what I was minded to do and we decided together, we were in agreement that we wouldn’t proceed with the abolition of the rate.”
Asked if he had considered resigning, he said: “Not at all.”
He is on his way out, though.
Remember, we’ve been told that the 45p tax rate doesn’t actually bring much money back into the Treasury; it isn’t the cause of the economic upheavals we have seen over the last week.
It didn’t crash the Pound.
It didn’t crash the pension funds.
It hasn’t put the cost of imports up beyond the benefit to ordinary people of the other tax cuts.
We are heading for worse problems over an autumn and winter that Truss and Kwarteng have deliberately turned into a waking nightmare for millions of us.
What will these two con tricksters blame next?
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Knife: is Liz Truss plunging one of these into Kwasi Kwarteng’s back – metaphorically, at least?
Wow. New UK prime minister Liz Truss is already showing her vicious side. Who knew she had one?
In what is the BBC’s headline report at the time of writing, Truss lays as much blame for the failure of the Tory ‘fiscal event’ of September 23 on Kwarteng:
She added a decision to cut the top earner tax rate was a “decision that the chancellor made”. And she revealed it was not discussed with the whole cabinet beforehand.
She added that the cut was a decision made by Chancellor Kwasi Kwarteng – prompting former cabinet minister and Boris Johnson loyalist Nadine Dorries to accuse her of throwing him “under a bus”.
Some commentators have picked up on this:
I’m not sure I want to envision Liz Truss “fingering” Kwasi Kwarteng, but I’m looking forward to his Tory conference speech tomorrow (October 3).
Will he retaliate?
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Carry On Fullbrook: he’s now being paid directly by the government, rather than via his firm (that might have enabled him to use a tax dodge). So that’s all right then.
We have to take our victories where we can – and this is good, as it seems to prevent Mark Fullbrook from dodging tax.
Here’s The Guardian:
The government made a U-turn after an outcry from the opposition and some Tory MPs, with one saying it did not “smell right” after tax changes in the budget making it easier to pay less tax if paid through a self-employed company.
The government admitted over the weekend that Fullbrook would be paid through his lobbying firm, a move that could have helped him avoid paying tax. He had previously claimed the firm had stopped all commercial activities.
It subsequently emerged that Fullbrook had been promised a lucrative contract to run Truss’s next election campaign as well as being made chief of staff.
On Tuesday, a No 10 spokesperson said: “While there are established arrangements for employees to join government on secondment, to avoid any ongoing speculation Mark Fullbrook will be employed directly by the government on a special adviser contract.
“All government employees, including those joining on secondment, are subject to the necessary checks and vetting, and all special advisers declare their interests in line with Cabinet Office guidance.”
Previously the government had said the arrangement was properly vetted by the propriety and ethics team.
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Gordon Brown has published a document calling for a wide range of reforms of the way the UK is governed, including better tax-raising powers for devolved governments and abolishing the House of Lords, to be replaced with an elected constitutional guardian.
Watch:
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Kwasi Kwarteng: he reckons he’s going to find a way to pay for Liz Truss’s energy price cap. But then, it’s not all that long since he said “fracking is over” – and look what has happened there.
A “fiscal event” to explain how the Liz Truss Tory governent will pay for its cap on energy bills will probably take place at the end of next week, it has been claimed.
We’re looking at September 23, it seems.
Also possible is an announcement of tax cuts to boost the economy and help (rich) people with rising living costs (that won’t affect them as much as the poor who won’t have help because they don’t pay tax).
During her campaign for the Tory leadership, Truss promised to undo the rise in National Insurance that was announced under Boris Johnson.
Apparently Kwarteng has announced a change in direction for the Treasury – that the department needed to focus on growing the economy by 2.5 per cent per year.
This follows the controversial sacking of top Treasury official Sir Tom Scholar.
Let’s have a look at that…
The implication is that the sacking was politically-motivated and Truss (along with Kwarteng and the rest) is replacing the UK’s formerly impartial civil service with one that is politically partisan.
This will lead to poor, ideologically-motivated decisions being pushed through by officials who should be advising politicians on the strengths or weaknesses of such moves.
It will destabilise the UK even further, at a time when we need a steady hand in charge.
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