Truss U-turned on tax cuts for the super-rich – now she can axe the rest of her disastrous budget
Good news. The lady is for turning. Liz Truss has had a nightmare week. She galvanised her chancellor, Kwasi Kwarteng, to produce a crazily ideological budget shorn of the normal checks and balances. The head of the Treasury was sacked, the Bank of England ignored, Whitehall’s official factcheckers stifled and the cabinet left in the dark. It was 2012’s “omnishambles” budget all over again. The nation must thank “the markets” and backbench Tories for stopping the most gratuitous of Kwarteng’s tax cuts, the 45% band, albeit saving the Treasury a mere £2bn.
That is just a beginning. Truss is living on borrowed time and capitulated to “the message” from party backbenchers over the weekend. Since Kwarteng’s budget was incomplete and lopsided he now has an opportunity to correct it, and in spades. The future growth on which it is based depends on a “supply-side plan”, so far undisclosed. So too is the means by which the plan and its related tax cuts are to be financed.
It is naive to expect that an instant surge of economic growth will arise from a mishmash of deregulating planning, subsidising freeports, reforming childcare, boosting immigrant visas and digging up the countryside. All have merit but most contain red rags to Tory bulls now on the rampage. To plead the virtue of unpopular toughness, as Truss did at the weekend, might work if she meant to stick to it. Now she merely invites another humiliating reverse. Truss’s predecessor Theresa May warned against the Tory party being seen as “the nasty party”. The planning changes alone risk depicting it as the ugly party.
As for paying the price, never before can a chancellor have presented parliament with such an “unbalanced” budget. To take one example, energy subsidies are
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