The taxpayer’s cost of Truss’s £100bn energy package has escaped scrutiny. liz truss
There can be no stark contrast between how the two political parties are judged on economic policy, as has played out for Liz Truss over the past fortnight.
Stunning scale of state spending announced to address energy crisis and enable total tax cuts omertOne So far how much will the proposals cost the British taxpayer.
A Labor shadow cabinet minister observed this week that he was irritated by an interview with Rishi Sunak in an earlier leadership contest on how he would fund his own energy crisis package – costing only £15bn – where he had at least £10bn was accepted. come on loan.
“We would have been crucified for that,” observed the shadow cabinet minister. “But since then we have announced hundreds of billions to the new PM and refused to say anything.”
The energy package for business announced on Wednesday did not detail the estimated cost of discounting wholesale electricity prices for companies, charities and public sector organisations, including schools.
The entire package was announced by the department through a press release and a Video Posted on Twitter by Business Secretary, Jacob Rees-Mogg.
There will be no statement in the House of Commons where Rees-Mogg can be questioned – MPs are using the time to ask the King to take the new oath, even though there is no obligation on him to do so. There has been no cabinet meeting to sign the resolution this week – the truce is in New York at the UN General Assembly.
Parliament will only have a chance to debate the proposals this Friday, the last day before another holiday, where Quasi Quarteng is expected to announce several new tax cuts, including national insurance, repeal of proposed corporation tax increases and stamp duty. cut fee. This will happen only if Quarteng will eventually have to pay the full cost.
But there will be no one to officially mark your homework on the cost of tax cuts and energy freezes in this week’s “financial program,” which is actually a mini-budget.
Quarteng declined to ask the Office for Budget Responsibility to produce any forecasts, despite strongly-worded intervention from Tory chairman Mel Stride of the Treasury select committee, who urged him to reconsider. OBR President Richard Hughes has told Stride that he was prepared to provide a forecast but the Treasury declined.
We only have outside predictions from thinktanks, financial firms and lobby groups to get an idea of how much the entire spending package will cost.
The predictions are eye-watering: tax cuts of £30bn to £50bn and government intervention to stabilize energy prices for consumers and businesses could cost more than £100bn, with some predictions of £150bn Is. It’s a generous short-term fix that doesn’t solve a long-term problem.
There is very little to be said about the exit strategy and what happens when the six-month limit on support is exhausted. Businesses will face an anxious wait to see if they will be able to access support for the most vulnerable.
Labor MPs may rave all of their liking about the Tories “taking politics on the easy mode”, but this approach also has major disadvantages. Ambiguity of proposals can make the market restless and there is a risk of borrowing so much that could lead to an increase in inflation. The truss is betting everything on economic growth, but if it doesn’t materialise, there will be no option but to cut spending.
Truss began his term in Downing Street with one of the toughest weeks a prime minister could face. But he now has a lot in his favor: a huge spending package to protect the people this winter, a major world event, however tragic, that allowed him to seize a moment as a gloomy politician, a recession. Opportunity to save money as well as lower fuel prices is helping to bring down inflation.
Those factors should give rise to an election surge for prime minister in the coming weeks, especially if she pulls off a successful Conservative convention. If it doesn’t, Tory lawmakers will wonder if there is anything that can save them.