Liz Truss defends Chancellor's revolutionary mini-Budget

2022-09-24

Liz Truss vows to unleash a ‘decade of dynamism’ as she defends her Chancellor’s revolutionary mini-Budget from nervous markets and critics who argue her tax cuts favour higher earners

Writing for The Mail On Sunday, Liz Truss defended tax cuts for higher earners
Chancellor Kwasi Kwarteng scrapped top 45p tax rate and cut 1p from basic rate
The move is part of a ‘dash for growth’ intended to turbocharge the economy

Liz Truss today vows to unleash a ‘decade of dynamism’ as she defends Friday’s Budget against criticism of tax cuts for higher earners.

The Prime Minister declares in an article for The Mail on Sunday that she is ‘unapologetic’ about her pursuit of a ‘low-tax nation rich in opportunity’, despite the nervous reaction of the markets and some of her own backbenchers.

In his striking announcement to the Commons, Chancellor Kwasi Kwarteng scrapped the top 45p rate of tax and cut 1p from the basic rate in the biggest package of tax cuts by a British Government for half a century.

Liz Truss has vowed to unleash a ‘decade of dynamism’ as she defended Chancellor Kwasi Kwarteng’s Budget on Friday against criticism of tax cuts for higher earners

The move is part of a ‘dash for growth’ which is intended to turbocharge the economy – and boost the Tories’ chances of winning the next Election.

Making her first public comments on the so-called ‘mini-Budget’ – which also included cuts to stamp duty, National Insurance and Corporation Tax – Ms Truss pledges that her administration will be defined by ‘taking tough choices and doing things differently’ from her Tory predecessors in No 10, adding: ‘We will usher in a decade of dynamism by focusing relentlessly on economic growth.’

Dismissing criticism that the £45billion worth of measures would disproportionately benefit the rich, Ms Truss writes: ‘Growth means families have more money in their pockets, more people can work in highly paid jobs and more businesses can invest in their future.

‘It provides more money to fund our public services, like schools, the NHS and the police.

‘We will be unapologetic in this pursuit… Everything we do will be tested against whether it helps our economy to grow or holds it back.’

GROWTH BOOST FOR SMALL BUSINESSES

Small businesses will be offered new ‘growth loans’ by the Government as part of the Prime Minister’s efforts to pull the economy out of the doldrums.

Liz Truss announces in the MoS today an extension of the Government’s Start-Up Loans programme – which offers support and funding to new businesses – to cover companies which have been running for up to five years.

The Start-Up scheme – which was established to help firms in their earliest stages – has provided more than 90,000 loans since its inception in June 2012.

The loans are subject to a fixed interest rate of six per cent, and the programme provides support – and discounts on products for businesses – to those who might find it difficult to secure funds from traditional lenders.

In her article, Ms Truss says: ‘I am on the side of all those who take responsibility and do the right thing, from setting up their own businesses to working hard and aspiring for a better life for themselves and their family.

‘Our clear plan will help them to thrive.

‘I know how hard it has been for small businesses. They are the lifeblood of our economy. When small businesses succeed, Britain succeeds too.’

Business Secretary Jacob Rees Mogg said: ‘This Government is relentlessly focused on driving growth to create better jobs, boost wages and fund our vital public services like the NHS.

‘Encouraging entrepreneurship and new businesses to thrive is critical to growing the economy and raising living standards.

‘From a hair salon in Wales, to a furniture business in Northern Ireland and a cake seller in the Lake District, expanding the Start-Up Loans scheme will support these small businesses through this challenging period and position them to grow – creating jobs and opportunities across the UK.’

Ms Truss also announced that the Government would be introducing new ‘growth loans’ to help businesses that have been trading for fewer than five years to expand, in recognition that small businesses are ‘the lifeblood of the economy’.

The measures, which came after the Bank of England warned that the UK may already be in a recession and raised interest rates to 2.25 per cent, will be paid for by tens of billions of pounds in Government borrowing – a move which led to falls in the value of the pound and on the stock market.

Labour seized on Mr Kwarteng’s abolition of the top rate of tax, which will hand an average £10,000 back to the country’s top 660,000 earners.

As her party gathered in Liverpool for its annual conference, Deputy Leader Angela Rayner described Ms Truss’s ‘trickle-down economics’ approach as ‘a very dangerous gamble on our economy and future generations’.

She said: ‘I don’t accept the argument of trickle-down economics – give those at the top loads more money and that will filter down to those at the bottom.

‘That’s not how it works. We’re going to saddle the next generation with more debt.’

However, business chiefs welcomed the measures, with the Confederation of British Industry saying there was ‘no choice but to go for growth’.

Former Tory treasurer Lord Ashcroft said the Budget indicated the country seemed ‘after 12 years to have a Conservative government’.

According to the Treasury, the measures will pay for themselves if they succeed in adding an extra one per cent a year to GDP.

In her MoS article, the Prime Minister reinforces her Thatcherite credentials, saying: ‘We believe people should be in control of their lives and keep more of the money they earn.

‘That is why it would not be right to allow families and businesses to be lumped with the heaviest tax burden in 70 years.

‘People know better than any Government what to do with their hard-earned money.

‘And so, we have set out our clear plan to deliver £45billion of tax cuts in what will be the biggest tax-cutting package for generations.’

Ms Truss adds: ‘We will get Britain moving by cementing our status as the best place in the world to do business… It is our duty to make Britain the most competitive and successful economy possible, and we will do whatever it takes to deliver that.

‘For too long, politicians have fought over how to slice up the economic pie. We will focus instead on growing the pie to the benefit of families and businesses.’

Labour Deputy Leader Angela Rayner described Liz Truss’s ‘trickle-down economics’ approach as ‘a very dangerous gamble on our economy and future generations’

LIZ TRUSS: For too long politicians have fought over how to slice up the economic pie. My mission is to make it much bigger

When I entered Downing Street a little over two weeks ago, I promised to unleash the potential of our United Kingdom. I promised to get us through the economic storm we face in the wake of Covid and Putin’s awful war in Ukraine and to ensure we emerge a stronger and better nation.

We are now delivering by taking tough choices and doing things differently. For years, our economy has not grown as much as it could and should. Instead, we will usher in a decade of dynamism by focusing relentlessly on economic growth.

We have a clear plan to build an ambition Britain, where everyone everywhere can realise their potential. We will make good on the promise of Brexit by seizing our chance to take the shackles off our economy and become a more enterprising, low-tax nation rich in opportunity.

When I entered Downing Street a little over two weeks ago, I promised to unleash the potential of our United Kingdom LIZ TRUSS writes

I am optimistic about the future. I know we have the talent, enterprise and energy to achieve higher economic growth.

Of course, growth is about more than numbers on a spreadsheet. It is fundamentally the mark of a thriving economy.

Growth means families have more money in their pockets, more people can work in highly paid jobs and more businesses can invest in their future. It provides more money to fund our public services, like schools, the NHS and the police.

We will be unapologetic in this pursuit, as set out by my friend the Chancellor this week in his Growth Plan. Everything we do will be tested against whether it helps our economy to grow or holds it back.

As Prime Minister, I am working day and night to support people across the country. I am on the side of all those who take responsibility and do the right thing, from setting up their own businesses to working hard and aspiring to a better life for themselves and their family. Our clear plan will help them to thrive.

I know how hard it has been for small businesses. They are the lifeblood of our economy. When small businesses succeed, Britain succeeds too.

Today, I can announce we will beef up our Start-Up Loans scheme to help brilliant businesses realise their ambitions. Businesses which have been trading for up to three years can now be offered finance.

Liz Truss became Britain’s third female Prime Minister just over two weeks ago

Ms Truss has promised to ‘get Britain moving again’ with her plans and a brand new cabinet

We will also be offering new ‘growth loans’ to those who have been trading for up to five years.

This is the latest step in our drive to get Britain moving.

Our pursuit of growth will be reinforced by a responsible approach to the public finances.

We will set out our approach more fully in due course, including how we plan to get our national debt down over the medium term.

We are tackling the biggest drag on growth, namely the energy crisis engineered by Putin. Our energy scheme will save the typical household £1,000 a year on their bills and roughly halve the cost of business energy bills. It will reduce peak inflation by about five per cent, helping to ensure the pound in your pocket buys as much tomorrow as it will today. We believe people should be in control of their lives and keep more of the money they earn.

That is why it would not be right to allow families and businesses to be lumped with the heaviest tax burden in 70 years. People know better than any government what to do with their hard-earned money. And so we have set out our clear plan to deliver £45 billion of tax cuts in what will be the biggest tax-cutting package for generations.

LIZ TRUSS: ‘We are tackling the biggest drag on growth, namely the energy crisis engineered by Putin’

We will benefit many millions of people across the county by reversing the rise in National Insurance, cutting the basic rate of income tax next year by 1p and abolishing the additional rates of income tax.

We have slashed Stamp Duty to help people climb the housing ladder, saving the average homebuyer £2,500 and first-time buyers up to £8,750.

This will have a considerable effect, with a third of all homes on sale in England alone now estimated to be exempt from the tax.

We will get Britain moving by cementing our status as the best place in the world to do business. We are putting our money where our mouth is in encouraging businesses to invest, create jobs and grow. We have followed through on our promise to suspend the corporation tax rise, with the result that our attractiveness to businesses will remain unbeatable.

We will get Britain building everything local communities need quicker, from roads and rail to broadband and energy infrastructure. We will do so by cutting through the red tape, much of it inspired by Brussels, stopping people from getting spades in the ground.

We will level up the country by harnessing the power of the private sector. That is why we are in talks about creating Investment Zones across the country, from the Tees Valley to the West of England and beyond. They would offer an unprecedented set of tax incentives for business to invest, create jobs and grow.

Ms Truss has vowed to level up the entire country by ‘harnessing the power of the private sector’

We will maximise the potential of our City of London to benefit the wider UK economy by reforming outdated and burdensome Brussels-inspired regulations like Solvency II.

It is our duty to make Britain the most competitive and successful economy possible, and we will do whatever it takes to deliver that.

For too long, politicians have fought over how to slice up the economic pie.

We will focus instead on growing the pie to the benefit of families and businesses.

What Mail on Sunday readers have seen this week is just the start. Over the next few weeks and beyond, we will be setting out more measures to get the economy growing, deliver more opportunities for people across the country, and help hard-working families.

I won’t just talk about things, I will actually do things. The British public can trust me to take the difficult decisions, to do what I believe is right, and to deliver what I say I will.

I will get Britain moving again.

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