“We have understood. We have listened.” These were the words that the British Chancellor of the Exchequer, Kwasi Kwartengused on Twitter to justify the withdrawal of one of the most controversial measures of the sweeping tax plan presented just ten days ago by his boss, Liz Truss. It is about the decision (now frustrated) to reduce 45% to 40% the maximum rate of personal income tax for the highest incomes (those who earn more than 170,000 euros per year) in the midst of the cost of living crisis.
This drastic change of course by the Government, which the local press calls “humiliating“, occurs a few days after the Bank of England has intervened emergency to contain the escalation of the British debt and the historic collapse of the pound sterling. To ultimately calm the agitation that the announcement of the cutback schedule of the new conservative Executive provoked in the financial markets.
However, if Liz Truss has backed down, it is not because she has deliberately changed her mind. In fact, on Sunday, hours before announcing the removal of the unpopular measure, the rewardBritish r said to the BBC be “totally committed“to carry out a cut that, he clarified, was a matter of Kwarteng.
We get it, and we have listened. pic.twitter.com/lOfwHTUo76
— Kwasi Kwarteng (@KwasiKwarteng) October 3, 2022
[El Banco de Inglaterra saca la artillería para que los inversores no vean a Reino Unido como país emergente]
Thus, the rectification seems to be the result of political pressure from within their own ranks, which threatens a rebellion. In recent days many Tories have opposite publicly to the policies that Truss and Kwarteng intend to carry out to “revive the UK economy“.
However, the package of measures still needs to be approved in parliament, so if Truss, who took office less than a month ago, fails to convince her fellow caucuses, she could lose the vote. And not only that: a failure in the House of Commons practically equivalent to facing a motion of confidence. It is enough if not to remember the triple parliamentary defeat that caused the resignation of Theresa May in 2019.
The conservative media Michael Govefor example, indicated that he would vote against tax reductions because he considers that “they are not conservative” and that they “display the wrong values”. In the same line, the exministra nadine dorrieswho backed Truss during the primaries, has now asked him to call an election because he “has no authority to govern.”
Annual Conference of the Conservative Party of Great Britain in Birmingham.
Goodbye to “In Liz we trust”
Far from being applauded, the backtracking on the tax cut has been seen as a sign of weakness and has ultimately scuttled Truss’s credibility. And also that of the Conservative Party. In fact, surveys like the one carried out by YouGov give the Labor opposition up 33 points advantage for the first time in years.
In the United Kingdom there are those who do not even expect the prime minister to arrive at the end of November, according to what is collected Guardian. Especially since there are many conservatives who say they are prepared to stop some of the plans announced by the Executive. And that the complete economic plan that is expected to come to light is still unknown on November 23. That is if the person in charge of the Economy portfolio does not choose to advance the date to reassure investors.
Protests at the annual Conference of the Conservative Party of Great Britain in Birmingham.
[21 días con Liz Truss: cae la libra, muere la reina y debilita a Reino Unido más que nunca desde el ‘brexit’]
However, despite internal discontent, the Conservative Party cannot afford another change of leader less than a year and a half from the general election. Hence, some parliamentarians have called for Kwarteng’s resignation to silence social and political discontent.
At the moment, the prime minister does not seem to contemplate this option, since she has supported her economy minister. She has done it, yes, with a small mouth. And it is that during the annual conference of the party that is celebrated this week in the city of Birmingham, the Tory leader He has refused up to two times to publicly support him.
Finally, in a third interview, he ventured to say that he “absolutely” trusted Kwarteng, who “is a very close companion” and with whom “works very closely“. We will have to wait and see if Liz Truss also changes her mind on this matter or not.
