Liz Truss has apologised for her “mistakes” and pledged to lead the Tories into the next general election as she fought for her job after a bonfire of her tax-cutting plans.
The Prime Minister said she has “adjusted what we’re doing” after the Government’s fiscal policies spooked the markets, putting in place a new Chancellor with a fresh strategy to “restore economic stability”. She said: “I do think it is the mark of an honest politician who does say, yes, I’ve made a mistake.”
Labour accused the Tories of sparking a crisis paid for by working people, and insisted “no sorry” could change that. The Prime Minister is battling to save her premiership after her economic agenda was left in tatters by the dismantling of her former chancellor’s landmark mini-budget.
Speaking after she sat silent in the Commons for roughly 30 minutes as Jeremy Hunt – the new Chancellor – told MPs he was scaling back the energy support package and ditching most of the tax cuts announced by his predecessor, Truss said she wanted to “accept responsibility and say sorry for the mistakes that have been made”.
“I wanted to act… to help people with their energy bills, to deal with the issue of high taxes, but we went too far and too fast. I’ve acknowledged that,” she told the BBC.
Truss became Prime Minister after winning the Tory leadership contest on the back of promises to dramatically cut tax. But she has been humiliated by a raft of U-turns after last month’s so-called “fiscal event” sparked chaos in the markets.
In the three weeks following the ex-chancellor’s mini-budget, the pound hit its lowest point in history, the interest rate on Government loans rose to its highest for 30 years, and London’s shares crashed to a 19-month low. The turmoil ultimately led to Kwasi Kwarteng’s downfall, with Hunt chosen to take the reins at the Treasury.
On Monday, he tore up the Prime Minister’s economic strategy, abandoning plans to cut the basic rate of income tax in April and freeze alcohol duty from February. The Government had already axed plans to scrap the 45p rate of income tax for top earners and had U-turned on a promise not to increase corporation tax.
The pound and UK Government bonds rallied in response to Hunt’s emergency statement, while economists suggested his approach may reduce the need for dramatic interest rate rises. Plans to cut national insurance contributions and a reduction in stamp duty, which are already going through Parliament, will continue.
Truss told the BBC she could not deliver “everything” she had hoped to, but pledged to follow through on her agenda for growth. She said: “Yes… I couldn’t deliver everything I wanted – I delivered the energy price guarantee and the national insurance and we will continue to work to deliver economic growth for our country.
“This week we’re introducing new legislation to make sure that we have smooth-running rail services and that commuters can get into work, and we were dealing with militant unions. So we will continue to deliver our agenda.”
Asked if she felt humiliated by the dramatic change in tack, the Prime Minister said things had not been “perfect”, reflecting on a “difficult time”. She went on: “I was expecting it to be tough, and it has been tough, I think it’s fair to say.”
She said it had been “painful” to sack Kwarteng. But she insisted it was the “right decision”.
“It was right that we changed policy. It’s right that we have a new Chancellor,” she added, “and now what I’m determined to do is make sure that works.”
There has been speculation that Truss could become the second Tory leader to be ousted this year. But she told the BBC she is “sticking around” because she was “elected to deliver for this country”, adding: “I will lead the Conservatives into the next general election – I will stay in the job to deliver for the national interest.”
Under current party rules, Truss is protected from a leadership challenge for 12 months, but that could change if enough Tory MPs demand it. The pressure on her gained traction on Monday evening, with five Tories now openly calling for her to go after just six weeks in power.
Sir Charles Walker was the latest to make the case for her exit. He told Sky News’ Beth Rigby: “I think her position is untenable, she has put colleagues, the country, through a huge amount of unnecessary pain and upset and worry.”
The situation “can only be remedied” with “a new prime minister”, he said.
James Murray, Labour’s shadow financial secretary to the Treasury, said: “After weeks of blaming everyone else, it seems the Tories have finally apologised for crashing the economy and sending people’s mortgages through the roof. But an apology won’t undo the damage they have done.
“Millions of people are facing £500 a month increases in repayments and the whole country will suffer if services are slashed in an attempt to salvage the wreckage they have made of the public finances. No sorry can change the fact that this crisis was made in Downing Street, but is being paid for by working people.”
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