Britain’s Finance Minister Jeremy Hunt leaves Downing Street in London on October 14, 2022 (AFP/ISABEL INFANTES)
New British Finance Minister Jeremy Hunt pointed out the government’s “mistakes” on Saturday and warned that he would take “very difficult decisions” in the face of the country’s crisis, a change of course that may not be enough to save the economy. Prime Minister Liz Truss.
“Truss fights for survival,” headlined The Times on Saturday. “Truss clings to power” headlined the Daily Telegraph, the conservative newspaper saying that Tory parliamentarians are still looking for a way to remove him from the head of the executive.
For the Daily Mail, Friday saw “chaos, confusion and flip-flops reaching unprecedented extremes”.
Speaking publicly for the first time since his appointment on Friday, new finance minister Jeremy Hunt said bluntly on Saturday that “mistakes have been made” by Prime Minister Liz Truss and her sacked finance ministry predecessor Kwasi Kwarteng. the day before in the midst of an economic crisis, which turned into a political crisis within the Conservative Party.
“The Prime Minister has recognized this and that is why I am here,” he added on Sky News television channel.
– Humiliation –
This close friend of Rishi Sunak, the former finance minister of Boris Johnson and opponent of Liz Truss in the campaign for Downing Street, has the mission of taking over the mini-budget announced on September 23 and very badly received by the markets, much of the Conservative Party and the British people.
“This will require very difficult decisions,” warned Mr. Hunt, who is preparing to abandon many of the Prime Minister’s campaign promises.
In particular, he announced that “spending will not increase as much as people would like”, that “some taxes will not be reduced as quickly as people would like”, and that others “will increase”, alluding in particular to the new concession announced Friday by Liz Truss.
The Prime Minister had to give up keeping the corporate tax rate at 19%, resigning herself to increasing it to 25%, as planned by the previous Conservative government. Two weeks ago, she had already had to abandon a tax cut for the wealthiest households in the face of the bronca aroused by this measure.
In their Sunday editions, the Times and Telegraph newspapers argue that Mr Hunt further plans to delay the planned reduction in the basic rate of income tax, imposing further humiliation on Ms Truss.
The appointment of Jeremy Hunt should reassure the markets as much as calm the rebellion among the Tories.
One of his first actions as new minister was to meet with Andrew Bailey, the Governor of the Bank of England, who had to act urgently to calm the markets after the presentation of the mini-budget.
Jeremy Hunt now appears as the strong man of the government, according to the British media, when Prime Minister Liz Truss is considerably weakened by his reversals. And his press conference on Friday did not convince.
British Prime Minister Liz Truss defends her disputed economic plan in front of MPs on October 12, 2022 in London (UK PARLIAMENT/AFP/JESSICA TAYLOR)
After his speech, the markets continued to punish the pound sterling and the cost of British debt rose slightly on Friday, also when the Bank of England ceased its emergency action.
A sword of Damocles for many British households who have mortgages to repay. Five million of them could have to repay 5,100 pounds more per year by the end of 2024 with the rise in interest rates, according to a study by the think tank The Resolution Foundation published on Saturday.
– “Error” according to Biden –
For the Financial Times, Mrs Truss sacrificed Mr Kwarteng “in a bet to save” his head in Downing Street but “the only thing that unites the (Conservative) party is the lack of confidence in Truss”.
On Friday, the Prime Minister had evaded questions about her personal fate, hammering that she remained “absolutely determined” to deploy her policy.
“I feel cheated, totally cheated,” Conservative MP Christopher Chope told the BBC, judging Liz Truss “in total opposition to everything she supported when elected.”
But in his camp, we also raise the specter of a crushing defeat for those of the conservatives who would be tempted to provoke a general election, at a time when the Labor opposition prances in the lead in the polls.
Labor leader Keir Starmer on Saturday castigated the “grotesque chaos” engendered by the Conservative government. “All the difficulties facing our country today are its responsibility,” he insisted.
On the other side of the Atlantic, Joe Biden considered that the plan abandoned by Ms Truss was “a mistake”. “I think the idea of cutting taxes for the super-rich at a time when… I didn’t agree with that policy, but that’s for Britain to decide, not me “, added the American president.
© 2022 AFP
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