UK Prime Minister Liz Truss on Monday (local time) apologised for going “too far too fast” with reforms that caused investor confidence to evaporate and her poll ratings to plunge, however, she vowed to stay on and lead Tories into next election.
In an interview with UK-based media, Truss said, “I do want to accept responsibility and say sorry for the mistakes that have been made… we went too far and too fast,” reported The Straits Times. However, she said that she was “completely committed to delivering for this country” despite questions over who was now in control of government policy, she told.
Her government on Monday axed almost all of its debt-fuelled tax cuts unveiled last month to avert fresh market chaos.
Finance Minister Jeremy Hunt, who was appointed on Friday after Truss sacked her close ally Kwasi Kwarteng, jettisoned the remaining major planks of her tax-cutting agenda on Monday, including scaling back her vast energy support scheme.
Asked if she was now prime minister in name only, Truss said she had appointed Hunt because she knew she had to change direction, reported Australian daily, The Islander.
The shock move by new finance chief Jeremy Hunt – parachuted into the job on Friday to replace sacked Kwasi Kwarteng – leaves Truss’ position in a precarious state, with Conservative MP Roger Gale saying that Hunt was “de facto prime minister”.
Hunt estimated the tax changes would raise about Pound 32 billion per year after economists estimated the government faced a Pound 60 billion black hole. He also warned of tough spending cuts, reported The Straits Times.
The chancellor of the exchequer said no government could control markets – but stressed his action would give certainty over public finances and help secure growth.
“The prime minister and I agreed yesterday to reverse almost all the tax measures announced in the growth plan three weeks ago,” Hunt told parliament, flanked by a grim-faced Truss.
The chancellor also announced the formation of an economic advisory council, featuring four experts outside of government, reported The Straits Times.
Hunt scrapped plans to axe the lowest rate of income tax and curbed the government’s flagship energy price freeze – pulling the plug in April instead of late 2024.
A proposed reduction in shareholder dividend tax was also binned, along with planned tax-free shopping for tourists and a freeze on alcohol duty.
The announcement comes as Truss’ governing Conservative party tanks in the opinion polls amid the reversals and Britain’s worsening cost-of-living crisis.
Tax reductions financed via borrowing were the centrepiece of last month’s ill-fated budget.
Truss had already staged two embarrassing budget U-turns, scrapping tax cuts for the richest earners and on company profits, and is now facing calls to resign even from her own MPs, reported The Straits Times.