Dame Arlene Foster has branded parts of Chancellor Kwasi Kwarteng’s financial report as “monumental stupid”.
The former DUP leader and First Minister has criticized his decision to remove the cap on bankers’ bonuses and abolish the top rate of income tax, saying it was a “gift” to Labour.
She was speaking as Treasury Secretary Conor Murphy warned again that Mr Kwarteng was taking “a huge risk” to the economy.
Today, the Chancellor defended his mini-budget by saying the government had “no choice” but to do “something else” to stimulate the economy.
It comes at the end of a turbulent week that saw sterling fall to an all-time low against the dollar and the Bank of England was forced to spend billions buying up sovereign debt to prevent a collapse in the pension industry.
Sterling’s sell-off raised fears millions of mortgage holders could face a crippling surge in their repayments as the bank hikes rates to support the currency and curb inflation.
The turmoil erupted after markets feared Mr Kwarteng’s £45billion package of unfunded tax cuts – the biggest in half a century – while he earmarked billions to cap energy bills for the next two years.
Dame Arlene said on Radio 4’s Any Questions: “There were parts of the announcement that clearly focused on the pursuit of growth – cutting income tax and not allowing the increase in corporate tax.
“But I think it was monumentally stupid to include the banker bonus and the tax cut and I actually think that took away from some of the good that was in the package and it was of course a gift to Labor just before you party conference took place.”
She added: “I know it was a ‘mini-budget’ – I don’t think it was a very small budget – but I would have liked to see it, for example, when it came to issues like women’s reintegration would have acted in the labor market.”
On Saturday, Stormont’s finance minister joined his peers from other devolved governments to seek an urgent meeting with Mr Kwarteng and said immediate action was needed to reverse the damaging effects of the government’s tax proposals.
Mr Murphy, the Welsh Finance Minister and Scottish Finance Minister, highlighted the profound impact of “the biggest string of unfunded tax cuts for the wealthy in over 50 years” and warned that it “poses a huge risk to public finances and the health of our economy.” ” be “.
In a joint letter to Mr Kwarteng, they warn they are being condemned to another decade of austerity and express deep concern at reports that Whitehall Government departments are being asked to make spending cuts to balance the budget, which is already having profound consequences to settle the decentralized budget could have been eroded by inflation.
But on Saturday, as Prime Minister Liz Truss admitted the strategy had caused “disruptions”, Mr Kwarteng said the public expected public spending to be tightly controlled.
“British taxpayers expect their government to be as efficient and effective as possible and we will deliver on that expectation,” he wrote in The Daily Telegraph.
“Not all of the measures we announced last week will be popular everywhere. But we had to do something different. We had no other choice.”
The Chancellor also insisted he would present a “credible plan” to restart public finances with a “commitment to spending discipline”.
As the Tories prepared to head to Birmingham for their annual conference, Ms Truss warned the country was facing a “tough winter” as she indicated she had no plans to reverse her tax cut agenda.
“I know there was disruption, but it was really, really important that we could help the families as soon as possible,” the prime minister said in a joint interview with broadcasters on Friday.
“This will be a difficult winter and I am committed to doing everything I can to help families and the economy during this time.”
As the Tories ease in opinion polls – one of which showed Labor enjoying an unprecedented 33-point lead – some Conservative MPs have been pushing for a change of course.
Despite being at Downing Street for less than a month, some have questioned whether Ms Truss can survive until the end of the year now that the party has destroyed her reputation in business.
However, the Prime Minister insisted Mr Kwarteng was right to cut taxes as part of her plan to boost the UK’s sluggish economic growth.
“It is important to me that we get the UK economy back on track, that we keep taxes low, that we encourage investment in our country and that we get through these difficult times,” she said.
With some analysts warning of pressure on public spending to bring debt under control, the prime minister again refused to commit to an annual increase in benefits in line with inflation – something Rishi Sunak had promised when he was chancellor was.
In her interview, Ms Truss said only that it “is something the Secretary for Work and Pensions (Chloe Smith) is looking at”.
She added: “It is important to me that we are fair in our decisions, but most importantly that we are helping families and businesses with their energy prices at this very difficult time.”
But a key Prime Minister ally, Leveling Up Secretary Simon Clarke, went further and suggested the government was looking to downsize the state.
“I think it’s important that we look at an extremely large state and see how we can make sure it’s fully geared towards a lower tax economy,” he told the Times.
Mr. Kwarteng is expected to release a medium-term fiscal plan on November 23, outlining how he intends to reduce debt-to-GDP ratio, as well as updated economic forecasts from the Office for Budget Responsibility (OBR).
The lack of fresh forecasts from the independent OBR was seen as one of the main reasons markets reacted so poorly to the Chancellor’s mini-budget.
Some Tory MPs have urged him to bring forward the publication date to restore markets’ confidence in the government.
https://www.belfasttelegraph.co.uk/news/northern-ireland/parts-of-kwasi-kwartengs-mini-budget-were-monumentally-stupid-claims-arlene-foster-42031804.html Parts of Kwasi Kwarteng’s mini-budget are “monumental stupid,” claims Arlene Foster