Kwasi Kwarteng defends tax policy as markets falter and says he had ‘no choice’ – UK politics live | Politics

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Robert Booth

Robert Booth

UK households are poised to set their energy bills on fire later, in a wave of protests against the cost of living coinciding with the rise in gas and electricity prices that are pushing bills up.

In what organizers predict will be the biggest nationwide protests against an economic crisis, which worsened this week with money market chaos and the rise in mortgage rates looming, dozens of rallies will be staged from Plymouth to Aberdeen, while post – and railway workers also strike.

Those who handle lighters include the backers of Don’t Pay UK, a grassroots movement that has received nearly 200,000 pledges from households willing to cancel their direct debits unless the government does more to protect the poorest families.

The protests are being coordinated between multiple civil society organizations and unions in an effort to maximize impact.

Later in the day we will report live on the protests in this blog.

Prime Minister admits ‘disruption’ after mini budget

Harry Taylor

Like the Chancellor, the Prime Minister has used a Saturday newspaper column to defend the government’s actions.

In the face of fierce criticism, including a sharp rebuke from the IMF, Liz Truss has admitted that the mini-budget provided by her government last week caused “disruption” after it was followed by a series of economic shocks, including the pound falling to an all-time low against the dollar.

In The Sun, Truss did not subscribe to the changes to the 45p interest rate, or the elimination of banker bonuses, which were also included in Kwarteng’s announcements. She said:

For too long we’ve been arguing about how to divide the economic pie, instead of growing the pie so that everyone has a bigger share.

The status quo is not working. We have been hampered by low growth and high taxes for too long. We need to get things done faster in this country.

So I’m going to do it differently. These are difficult decisions and in the short term do cause disruptions.

Not everyone will like what we do, but I want to reassure the public that the government has a clear plan that I think is good for the country.

Earlier on Friday, she had told broadcasters:

I recognize that there has been disruption, but it was really important that we were able to get help for families as quickly as possible.

What is important to me is 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.

Quarteng: I had no other choice

Good morning. As the effects of the Chancellor’s mini-budget continue, the pound tumbles and markets falter, Kwasi Kwarteng has tried to defend the government’s actions.

In the Daily Telegraph he wrote:

British taxpayers expect their government to work as efficiently, effectively and as possible, and we will deliver on that expectation.

Not all of the measures we announced last week will appeal to everyone. But we had to do something else.

We had no other choice.

His announcements just over a week ago included a cut in income tax from 45p to 40p in the pound for the highest earners. Other taxpayers got a 1 cent discount on income tax and are getting money from a reversal in the rise in national insurance. The chancellor said they would all help boost growth.

However, there was strong market reaction to the package, which amounted to the largest tax cuts in 50 years. The Bank of England has subsequently spent billions of pounds buying up government debt to support pension schemes. It has also indicated that interest rates want to rise significantly, leading to jumps in mortgage rates and lenders closing many deals.

In response to the markets reaction, Kwarteng added:

Even in the face of extreme volatility in global markets, with major currencies struggling with an incredibly strong US dollar, we will show financial markets and investors that our plan is solid, credible and will work to drive growth.

Stay with us all day long for the latest political news and developments.

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