The first phase of Liz Truss’s reign is over – is there any way back from the 45p tax cut U-turn? | Beth Rigby
It took 10 days for the most eye-catching and controversial element of Kwasi Kwarteng’s mini-budget to unravel.
The abolition of the top 45p of rate next April is not going ahead.
And it matters not so much because of the impact the decision has on the economic plan – the tax cut was £2bn in a £45bn package of cuts – but because what it tells us about Liz Truss and her government.
The first phase of her reign is over already.
For, as little as 24 hours ago, the prime minister insisted that she was not going to change course.
On Sunday night two Truss-backing newspapers, the Express and the Mail, had it plastered across their front pages that the chancellor was going to “stay the course”.
All evening, cabinet ministers and other government figures I bumped into at the Tory conference insisted there would be no change of policy.
What a cabinet minister told me would happen instead, was that the government would delay the finance bill – the piece of legislation required to pass Mr Kwarteng’s mini-budget – until the spring of next year to try to avoid a confrontation.
Overnight that resolve unravelled as the PM and chancellor, battered by a growing opposition led by former cabinet ministers Michael Gove and Grant Shapps, decided the policy had to go.
The cabinet were told the next morning, even as some – like Sky News – were reporting the expected U-turn.
“I think it was the cumulative effect of pressure within and without the cabinet,” said one cabinet minister.
“It was best to get this out of the way ahead of his big speech and the PM’s on Wednesday.”
But lancing the boil on the matter of the top rate of tax does not cure the malady that has beset the Truss administration.
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‘We have a plan and we need to deliver it’
This was a prime minister who built her image with the public and the party as a leader who was not for turning, and who was prepared to be unpopular in pursuit of her goals.
She has now shown her opponents that the lady is for turning and the immovable is movable.
One cabinet minister, who privately didn’t much like the policy, told me the PM should have stuck to it in order to try and maintain credibility and protect her brand.
Floodgates are open
In reversing the policy, the PM has opened the floodgates and backbenchers will try to move her on lots of other policies too.
Already in their sight is the PM’s refusal to commit to Boris Johnson’s promise to uprate benefits by inflation rather than earnings in order to make sure four million low-income families and workers don’t have to take a real-terms benefits cut.
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What do young Tories think of Truss?
Ms Truss and her allies say the decision was the recognition of the political reality they faced with a party and a country opposed to the plan.
Attempt to calm the choppy waters
Her allies admit that the groundwork in selling the original package has been wanting in the rush to introduce the first batch of economic reforms – the tax cuts – to try to push for that 2.5% economic growth target in time for the next election.
Their hope is that the supply side reforms, coupled with the independent Office of Budget Responsibility (OBR) forecasts, and medium-term fiscal plan will calm choppy waters and buy Ms Truss time.
But the political miscalculation to announce a cut to the top rate of tax in the midst of the worst cost of living crisis since the 1970s, only to then have to U-turn, is no doubt a deep body blow for this PM.
She wasn’t initially the first choice for leader amongst her MPs and already had a battle on her hands to stamp her authority on the party. A massive U-turn designed to build bridges with a divided parliamentary party and a deeply unconvinced public.
But some MPs here are quietly asking, is there any way back?
Canterbury MP Rosie Duffield has resigned from the Labour Party.
The 53-year-old MP is the first to jump ship since the general election and in her resignation letter criticised the prime minister for accepting thousands of pounds worth of gifts.
She told Sir Keir Starmer the reason for leaving now is “the programme of policies you seem determined to stick to”, despite their unpopularity with the electorate and MPs.
In her letter she accused the prime minister and his top team of “sleaze, nepotism and apparent avarice” which are “off the scale”.
“I’m so ashamed of what you and your inner circle have done to tarnish and humiliate our once proud party,” she said.
Rosie Duffield. Pic: UK Parliament/Jessica Taylor/Handout via Reuters
Sir Keir has faced backlash after a Sky News report revealed he had received substantially more freebies than any other MP since becoming Labour leader.
Since December 2019, the prime minister received £107,145 in gifts, benefits, and hospitality – a specific category in parliament’s register of MPs’ interests.
Ms Duffield, who has previously clashed with the prime minister on gender issues, attacked the government for pursuing “cruel and unnecessary” policies as she resigned the Labour whip.
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She criticised the decision to keep the two-child benefit cap and means-test the winter fuel payment, and accused the prime minister of “hypocrisy” over his acceptance of free gifts from donors.
“Since the change of government in July, the revelations of hypocrisy have been staggering and increasingly outrageous,” she said.
“I cannot put into words how angry I and my colleagues are at your total lack of understanding about how you have made us all appear.”
Ms Duffield also mentioned the recent “treatment of Diane Abbott”, who said she thought she had been barred from standing by Labour ahead of the general election, before Sir Keir said she would be allowed to defend her Hackney North and Stoke Newington seat for the party.
Her relationship with the Labour leadership has long been strained and her decision to quit the party comes after seven other Labour MPs were suspended for rebelling by voting for a motion calling for the two-child benefit cap to be abolished.
“Someone with far-above-average wealth choosing to keep the Conservatives’ two-child limit to benefit payments which entrenches children in poverty, while inexplicably accepting expensive personal gifts of designer suits and glasses costing more than most of those people can grasp – this is entirely undeserving of holding the title of Labour prime minister,” she said.
Ms Duffield said she will continue to represent her constituents as an independent MP, “guided by my core Labour values”.
UK
King Charles hails ‘uniquely special’ Scotland as it marks Holyrood milestone – before being hugged by woman
The King has paid tribute to Scotland as a “uniquely special place” for the Royal Family as he marked the 25th anniversary of the Scottish parliament.
At the ceremony to commemorate a quarter of a century since parliament opened at Holyrood, the King said: “Speaking from a personal perspective, Scotland has always had a uniquely special place in the hearts of my family and myself.
“My beloved grandmother was proudly Scottish, my late mother especially treasured the time spent at Balmoral, and it was there in the most beloved of places, where she chose to spend her final days.”
He said we are all “united by our love of Scotland”, paying tribute to its “natural beauty”, “strength of character”, “diversity of its people”, “passions and frequently deeply held beliefs”.
“From the central belt to the north Highlands, across the islands in Ayrshire, in the Borders, the cities, towns and villages, all the coastal communities, who I wonder, could not fail to be moved by this complex Caledonian kaleidoscope?,” he asked as presiding officer Alison Johnstone and the Queen sat beside him.
After he gave the speech, the King was hugged by a member of the public – who said she did so “because of him being unwell”.
The 75-year-old was diagnosed with cancer in February but has since returned to public duties.
Yvonne Macmillan, 59, from East Renfrewshire, attended the anniversary ceremony with her husband Russell who is registered blind and chosen as a “local hero” for work in their area.
“I asked him if he was feeling better and if I could give him a hug. I actually said to him: ‘Can I hug you?’,” she said.
“As I hugged him I said, ‘God bless you’, so it was like God giving him a hug.”
The King listens to the presiding officer of the Scottish parliament at Holyrood. Pic: PA
The Queen sits alongside the King as he makes his speech on Saturday. Pic: PA
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While Sir Tony Blair’s Labour government legislated for Scottish devolution in 1997 – parliament officially opened at Holyrood on 1 July 1999.
The King has made six visits to the parliament since 1999 – while his mother Queen Elizabeth II made 10 visits during her lifetime.
The King arrives at the Scottish parliament on Saturday. Pic: PA
Scottish First Minister John Swinney is one of a number of MSPs who have been at Holyrood since the start of devolution.
He said in his own speech in Edinburgh on Saturday that the parliament has “placed itself at the very heart of the nation”, describing it as a “vessel of enlightenment, invention and creativity”.
The King shakes hands with First Minister John Swinney in Edinburgh on Saturday. Pic: PA
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The SNP’s Christine Grahame is another MSP who has been there since the start.
“Free tuition, free prescriptions, game-changing policies to tackle child poverty, the ban on smoking, the baby box, ScotRail back in public ownership – none of this would have been possible without the Scottish parliament and the strength of our commitment to self-determination,” she said on Saturday.
The King said the devolved parliament has the ability to “touch and to improve the lives of so many individuals”.
Former first ministers Nicola Sturgeon and Humza Yousaf take a selfie as they wait for the King. Pic: PA
But he added that “there remains much more to be done” for Scotland, the rest of the UK, particularly with regards to climate change.
“Let this moment therefore be the beginning of the next chapter,” he told those assembled.
“The achievement of the past and the commitment shown in the present give us the soundest basis for confidence in the future.”
A moped riding phone thief was caught red-handed after police tracked the device down hours after he snatched it from a woman’s hand.
CCTV footage released by police showed a masked moped rider mount the pavement in Croydon, south London, to swipe a phone from a woman’s hand on 6 March, while another victim had theirs stolen while they waited for a bus an hour later.
Amari Scott, 20, looked surprised when confronted by officers inside a shop, where he was found with two mobile phones.
Amari Scott was caught red-handed. Pic: Met Police
“We’ve just had a moped rob a mobile phone off the pavement and the phone is pinging in this location,” one of the officers told him in body-worn camera footage before Scott was handcuffed and led away.
Police also recovered a stolen motorbike and Scott, from Sutton, south London, was later jailed for four years.
Two teenagers who committed four robberies in the space of just half an hour were also arrested as part of a crackdown in Croydon.
Aged 16 and 17, the teens were issued with referral orders after pleading guilty to charges of robbery, attempted robbery and attempted grievous bodily harm.
Amari Scott was jailed for four years. Pic: Met Police
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They were behind a spree of eight robberies across Croydon and nearby Bromley, including four within 30 minutes on the morning of 5 August.
Their crimes, which included the knife point robbery of a rough sleeper outside Croydon library, were caught on CCTV.
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One of the teenagers tried to discard a knife before she was arrested after a foot chase, telling officers: “The knife wasn’t mine”.
The other ran away, leaving a knife and his bag, but was lying in bed at home when he was arrested shortly after.
Two teenagers committed four robberies in 30 minutes. Pic: Met Police
The Metropolitan Police said officers are intensifying efforts to tackle robbery and theft, encouraging victims to report incidents as they happen to increase the chances of catching the criminals.
Chief Inspector James Weston said: “We understand the impact that robbery has on victims – it is invasive and frightening.
“That’s why our teams are working so hard to deter and catch offenders to reassure our local community.
“Thanks to the hard work of officers, our partners and community grassroots organisations, we are stepping up our efforts and tackling the issues that matter most to the people of Croydon.”
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