THE Government has to come out with a detailed explanation of how its “growth plan” is going to be financed. It is that lack of understanding that is spooking the markets and bringing almost universal criticism from around the world.
The Government called Friday’s statement a “fiscal event” rather than a “budget” to avoid having to release an Office of Budget Responsibility report showing how the figures added up. This Johnsonian ruse of being cavalier with the facts has immediately backfired on new Prime Minister Liz Truss and her Chancellor Kwasi Kwarteng.
The financial furore over the statement has drowned out the positive news about the cap on fuel prices, a move that was sorely needed by British families.
Now families are facing further massive hits as interest rates on mortgages soar, fuel rises further because of the weak pound and inflation rips out of control.
The best economic growth plan has always been a stable economy with low inflation and low interest rates, yet the Government’s “growth plan” has actually destabilised the British economy, with the Bank of England forced to intervene yesterday to bring a degree of calmness.
But what company is going to invest, and so create growth, when interest rates are shooting so high and there is uncertainty all around? At this rate, the “growth plan” is going to backfire and harm growth.
That’s why a detailed explanation is needed, both to the markets but also to the British people who voted in 2019 for a Boris Johnson Conservative plan of high tax and spend and not for the Truss model of low tax and high borrowing.
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