Kwasi Kwarteng: What a day! Chancellor admits fiscal plan caused ‘a little turbulence’ but vows to plough on with economic plan
The chancellor has admitted it has been a tough day after he was forced to U-turn on cutting income tax for the rich.
Kwasi Kwarteng began his keynote speech at the Conservative Party conference by saying: “What a day, it has been tough but we need to focus on the job in hand.”
Just hours earlier he announced he was ditching plans to remove the 45p rate of income tax for the wealthiest 1%, unveiled at the mini-budget 10 days ago.
And after his speech, it was revealed Mr Kwarteng is bringing forward his medium-term financial statement from 23 November to this month, despite this morning saying he would not.
He admitted to Tory members his economic plan had caused “a little turbulence” but continued to back his vision for growth, saying: “With economic growth, everybody benefits, and I mean, everybody.”
Chancellor vows ‘no more distractions’ – follow live updates from Birmingham
In his original speech, before the U-turn, he had been set to say the government must “stay the course”.
But after acknowledging the change briefly, he said the government was ploughing ahead with boosting economic growth across the UK.
“We need to move forward. No more distractions. We have a plan and we need to get on and deliver it. That is what the public expect from the government,” he told Tory members in Birmingham.
“We’ve done it before and we can do it again.”
The chancellor said the path the country was on was “unsustainable” and said “we had no choice, the price of inaction would have been far greater than the cost of the scheme”.
And he said his plan to cut taxes to boost growth “isn’t radical, isn’t irresponsible” and will put more money in people’s pockets.
So much left unsaid
Sky News’ deputy political editor Sam Coates said: “There was just so much not addressed so you were left thinking what was it he wanted people to take away from that?
“At this conference, they’re desperate to try to get some political credit for the £45bn they’ve committed to spending.”
He added that the chancellor did not mention how the plan is fiscally responsible and if it is staying within their budget.
Coates also said one of the biggest political challenges over the next 18 months will be the consequence of higher interest rates but there was “not a word about that either”.
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Most bizarre speech I’ve ever heard
Labour MP Chris Bryant told Sky News he had “never heard such an uninspiring speech from a chancellor”.
“That’s the most extraordinary thing, condemning the fact that we have very low growth at the moment and that we’ve had had it for the last 12 years compared with the Labour years,” he added.
“He was complaining about the high tax rate, even though he’s voted for all the 15 rises in taxes over the last few years. It’s just the most bizarre speech I’ve ever heard.”
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Shadow chancellor Rachel Reeves said the speech showed the chancellor and government are “completely out of touch, with no understanding on its own appalling record on growth”.
She said the budget is “an economic crisis made in Downing Street, paid for by working people” and called for them to reverse the budget “and abandon their discredited, dangerous trickle down approach”.
Sarah Olney, the Lib Dem’s Treasury spokeswoman, said Mr Kwarteng’s speech will bring “cold comfort” to struggling households.
