Former Politician Criticises Chancellors Mini-Budget After It Sparks Massive Market Turmoil | GMB

I’m afraid it was entirely predictable, plenty of people were saying this was going to happen. The government has now found itself in this particular mess with interest rates rising and the pound falling.’

It’s after the pounds hit that all-time low yesterday following the chancellor’s tax cuts announced on friday this morning things have steadied the pound trading at 1.08 against the us dollar someone who’s been following recent developments closely as former chief secretary to the treasury former conservative mp david gork david joins us now you had a um a piece

In conservative home and the the internal newspaper a day or so ago in which you said this was both economically risky but also politically risky can you um explain that to us well yeah so the the political risk is by announcing a reduction in the top rate of income tax uh at a time in which the country is facing a very significant difficulties the cost of

Living crisis um that will strike i think most people as the wrong priority and economically it was a risk because it’s already the case that the markets were nervous about uh the uh fiscal policy the tax and spend policy of the government they feared that we were borrowing too much uh and then they’ve gone ahead and not only announced a series of tax cuts that

Were largely expected but also some additional tax cuts and and that um not surprisingly has caused concern in the markets and i’m afraid it was entirely predictable plenty of people were saying this could happen and the government has now found itself in this particular mess with interest rates rising and the pound falling it’s one thing to have borrowing go up

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In a recession borrowing to go up in a pandemic temporarily i think which is very striking on friday was that the chancellor’s plans in applying national debt um i was saying it’s one thing to have some more boring in a recession or in a pandemic the striking thing on friday was the chancellor’s plans according to independent experts imply national debt rising

Year after year after year into the future i can’t remember a time when a government set out an economic fiscal plan like that could you even where no i can’t uh and yes you’re right there are circumstances where it is right and necessary to borrow more and you know in terms of you know a large part of this comes from the uh temporary uh energy price freeze and i

Think that’s the right type of policy to pursue is right to respond to that uh but then to sort of set out these plans and you know somehow hope that growth is going to solve your problem i’m afraid lacked credibility and that was the view that the markets took uh and and that’s why we’re in the position that it is and you know i’m afraid it was an irresponsible

Act by the chancellor on friday this is going to be surprised to people because you of course are a former conservative treasury minister and i wonder how many conservatives feel the way you do particularly those who are currently on the back benches some of whom might have warned in the leadership contests that there might be a problem with liz truss’s economic

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Plans and would that mean that these plans get voted down by the government’s own party it’s a very good question i mean first of all you you are absolutely right to say that rishi sunak in the leadership campaign warmed of precisely this and that lots of conservative mps strongly agreed with him and you know by and large the conservative party has traditionally

Stood for sound money of being cautious with the public finances now when it comes to uh votes on this i mean it’s quite a thing to vote against a government tax cut and whether there would be much of a rebellion i don’t know but i don’t think we know what the circumstances are going to be when we get to those votes and there are certainly conservative mps who are

Very anxious about the policy and if it felt that abandoning some of those tax cuts helped reassure the markets help give the uk greater credibility and help to ensure that interest rates don’t have to rise as much as they otherwise would do there clearly is a case for dumping those policies and whether the government does say voluntary or because of a backbench

Rebellion remains to be seen all right david good to talk to you this morning former conservative treasury minister thank you good to speak to you in the slot of course where we would normally expect a conservative minister i know we asked the treasury minister they they um didn’t put anybody up i have to say david gorg and i have disagreed on economic policy lots

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Lots of times but it’s quite achievement to make us in a hundred percent agreement and uh that’s what they’ve managed to there we are

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Former Politician Criticises Chancellor's Mini-Budget After It Sparks Massive Market Turmoil | GMB By Good Morning Britain