IT is “entirely plausible” that Liz Truss’s Tory government intended to create a financial crisis in order to prepare public services such as the NHS for privatisation, an economics expert has said.
After Chancellor Kwasi Kwarteng announced swingeing tax cuts for the wealthy, funded by £45 billion of government borrowing, the value of the pound plummeted to record lows.
Unprecedented interventions from the International Monetary Fund, the Bank of England, and global credit ratings agency Moody’s followed, with mounting calls from opposition politicians for parliament to be recalled to tackle the self-inflicted crisis.
Professor Richard Murphy, a political economist with the University of Sheffield, suggested that the financial crisis may have been the UK Government’s goal, with an eye on privatising services such as the NHS.
Speaking to The National, Murphy said: “One of the possibilities, and I'll float it, and I have to say I think it’s entirely plausible: they might have actually tried to create a crisis.
“The reason why is that, come November when Kwasi Kwarteng has promised a Budget, they will say ‘oh terribly sorry folks, but actually because we’ve had this awful time after my statement in September, we now have no money left, therefore we have got to cut the spending on education, NHS, social care, judiciary, whichever else you want’.”
Murphy said that all of those public services were “already in crisis with regard to shortage of funding”, and pointed out how cuts by the UK Government could directly impact on Scotland, even in such devolved areas.
Thanks to the Barnett Formula, changes in spending in England are automatically reflected in the block grant which is given to Scotland each year. Cuts to education or the NHS in England will then see parallel budgets have to be cut north of the Border, or funding to cover the shortfall taken from elsewhere.
Murphy went on: “As a consequence, we’re going to have a massive round of austerity again. We’re going to go back to [former Tory chancellor] George Osborne, or worse. And I actually think it’s entirely possible that that’s what they wanted.
“I think they will start charging for GP appointments – obviously this may not happen in Scotland but Scotland would have to find the funds if it didn’t get the funds from Westminster – they could be charging for hospital appointments, for A&E admission, they could be charging for some parts of school education. They’ll be preparing a lot of services for privatisation.”
The accounting professor further told The National that Scotland had been left with “only one choice left”.
He said: “Do you want to have independence or not? Do you want to be associated with a government that is going to be so discredited for years to come? … It’s going to take a decade to get over this.
“Scotland really, and bluntly, has only one choice left, and that’s get out of this mess.”
The Treasury has been approached for comment.
