Unrepentant Truss urges UK govt to cut taxes to boost growth

Former Conservative prime minister Liz Truss on Monday waded in to give the Tory government economic advice, nearly a year after she triggered market turmoil and took the UK to the brink of financial meltdown.

In a speech, Truss blamed “25 years of economic consensus” for causing stagnation, characterising her opponents as an “anti-growth coalition” of the “political and economic establishment”.

“I believe it is vital that we understand that and shatter that economic consensus, if we are to avoid worse problems in the future,” she told the Institute for Government political think-tank.

Her intervention came with the UK still feeling the after-effects of her chaotic, short-lived tenure, heaping pressure on her successor Rishi Sunak with a general election expected next year.

Year-on-year inflation is currently at 6.8 percent — the highest in the G7 — while GDP shrank by 0.5 percent in July after growing by the same amount the previous month.

Current finance minister Jeremy Hunt is preparing to outline government spending, ruling out tax cuts while inflation remains stubbornly high, causing a row in the ruling Conservative party.

An unrepentant Truss — a self-described free-market liberal who promised “growth, growth, growth” before she took office — urged Hunt to cut taxes to stimulate the UK economy.

She also urged the government to ditch some net-zero commitments, including the ban on the sale of new petrol and diesel vehicles from 2030, and to increase the retirement age.

But she was roundly mocked even before she gave the speech.

“Liz Truss giving a speech on economic growth is like an arsonist giving a talk on fire safety,” said the deputy leader of the smaller opposition Liberal Democrats, Daisy Cooper.

Truss had been warned when she took office in September last year — notably by Sunak — that trying to stimulate growth through tax cuts with more borrowing would make inflation worse.

She and her finance minister Kwasi Kwarteng ignored critics, causing the pound to plummet and a surge in mortgage rates, adding more pain to households already squeezed by hikes in food and energy bills.

After a U-turn, Truss fired Kwarteng then resigned herself on October 14 last year with her government’s credibility in tatters.

Truss conceded on Monday that she moved too fast but rejected criticism that her tax cuts were unfunded, and maintained they could have raised much-needed cash for public services.

Source: AFP