LONDON
British Prime Minister Liz Truss on Thursday faced a series of bruising interviews with local BBC radio, seeking to defend her government’s mini-budget in her first media remarks since the budget threw financial markets into chaos last week.
Last Friday, Chancellor of the Exchequer Kwasi Kwarteng announced £45 billion ($48.9 million) in tax cuts, some geared to higher earners, funded through government borrowing.
This was on top of a huge, multi-billion energy bailout package, and came in the context of combative moves against “economic orthodoxy” such as not asking the independent Office for Budget Responsibility to provide an assessment alongside the mini-budget, the unceremonious firing of the top civil servant in the Treasury, and suggestions the Bank of England’s mandate could be reformed.
The combined effect of all these factors spooked the markets, sending the pound sterling into freefall (it has almost reached parity with the US dollar), as well as sending the cost of government borrowing surging.
On Wednesday, the Bank of England was forced into the unprecedented move of protecting the British economy from its own government through a £65 billion intervention in some pension funds, which were reportedly close to collapse.
Still, Truss used Thursday’s morning round of interviews to double down, insisting that her government had “done the right thing.”
She said she was prepared to take “controversial and difficult decisions” because “what is important to me is we get our economy moving, we make sure that people are able to get through this winter and we are prepared to do what it takes to make that happen.”
She insisted that she still believes in “sound money,” as well as Bank of England independence, and said that there were difficulties in markets “around the world” triggered by the war in Ukraine, and that this was not a UK-specific problem.
Experts across the political spectrum dismiss the British government’s claims that the mini-budget was not to blame for the volatility of financial markets over the past week.
Truss attempted to focus on her energy bailout, which she said was the “biggest part” of the mini-budget.
She was pressed, however, on her tax cuts for the rich, particularly the abolition of the top rate of tax for higher earners.
Defending their fairness, she said lower taxes across the board “helps everybody because it helps grow the economy and for too long the debate in this country has been about distribution, not how we grow our economy.
"It is not fair to have a recession, it is not fair to have a town where you are not getting the investment, it is not fair if we don't get high-paying jobs in the future because we have got the highest tax burden in 70 years. That's what is not fair."
- Grilled on the Beeb
The series of interviews kicked off with BBC Radio Leeds. The interviewer started by saying Truss had been out of sight for four days since the mini-budget and subsequent financial turmoil.
“Where have you been?” the interviewer asked.
The interviewer at BBC Radio Kent asked Truss: “Are you ashamed of what you’ve done?”
BBC Radio Bristol was no more sympathetic, with the interviewer telling Truss: “Your chancellor (of the exchequer), on Friday, opened up the stable door and spooked the horses so much you could almost see the economy being dragged behind them.”
They continued: “It’s hard to know what is falling more since you entered Downing Street, the value of the pound or the Tory poll rating.”
They added: “You used to believe in sound money and bringing down borrowing when you were in David Cameron’s (2010-2016) government. Have you changed your mind on that now, like you did on Brexit?”
Truss backed Remain in the 2016 referendum, but has since refashioned herself as a hardline Brexiteer.
Speaking to BBC Radio Nottingham – like the sheriff of Nottingham in age-old British legends – the interviewer took Truss to task over her tax cuts for the rich, saying people in Nottingham told them it was a “reverse Robin Hood,” the sheriff’s much-loved nemesis. Truss said that “simply isn't true.”
The interviewer at BBC Radio Stoke asked Truss: “Is it time to reverse what you’ve done, bearing in mind what you’ve seen over the last four days, the damage it has caused to the pound?”
"Have you taken the keys to the country and crashed the economy?" they asked.
Truss said she would not change direction, because the majority of the package was related to the energy bailout, which was the right thing to do.
Fracking and vox pop
BBC Radio Lancashire took Truss to task over her lifting the ban in England on fracking, asking her: “What does local consent look like, prime minister?"
Truss could only reply that further details were to come but “it does mean making sure there is local support for going ahead."
"It sounds like you don't know,” the journalist countered.
"Your local MPs don't want it, all Conservative, the county council have said they didn't want it, yet your government overturned it. The science hasn't changed,” the interviewer asked. “Why can't you tell us this morning there won't be a return to fracking in Lancashire?"
"Well, I don't accept the premise of your question,” Truss said.
BBC Radio Norfolk asked the prime minister: “Can you reassure listeners that your judgment is better than that of people like the IMF and the Bank of England, who have criticized the mini-budget?”
As for local listeners, they asked Truss questions such as “What on earth were you thinking?” and “How can we ever trust the Conservatives on the economy again?”
This Saturday, amid the economic chaos, the ruling Conservative Party will begin its annual party conference. Senior Conservative figures, including Truss’ recent leadership rival Rishi Sunak, who warned against Truss’ economic plans, will not attend, according to reports.
