UK’s new finance minister scraps most of PM Liz Truss’ ‘mini-budget’, scales back energy subsidies
- Jeremy Hunt said government’s huge energy price cap would only run until April, then it would seek ways to help the most vulnerable households
- In just 6 weeks, Truss’ economic policies have triggered a financial crisis, multiple U-turns and the firing of a Treasury chief
The UK’s new Treasury chief ripped up the government’s economic plan on Monday, dramatically reversing most of the tax cuts and spending plans that new Prime Minister Liz Truss announced less than a month ago. The move raises more questions about how long the beleaguered British leader can stay in office.
In a televised address, Chancellor of the Exchequer Jeremy Hunt said he was scrapping “almost all” of Truss’ tax cuts, along with her flagship energy policy and her promise – repeated just last week – that there will be no public spending cuts.
While the reversal of policy calmed financial markets and helped restore the government’s economic credibility, it further undermined the prime minister’s rapidly crumbling authority and fueled calls for her to step down before her despairing Conservative Party forces her out.
Truss’ spokesman said the prime minister and Hunt had jointly agreed on the changes. But Hunt told Conservative lawmakers that Truss “backed him to the hilt in making difficult decisions” – suggesting he has a free hand to make policy.
Scrapping Truss’ plan to reduce the basic rate of income tax by 1 percentage point, Hunt said “it is a deeply held Conservative value – a value that I share – that people should keep more of the money that they earn”.