Mini-budget was serious mistake – former Tory Chancellor Lord Clarke says

Lord Clarke, Chancellor under Sir John Major, said the past week shows Liz Truss’s government have had a “catastrophic start”.

And clark formatory chancellor and it seems we have the picture good to see you and i was just asking law clark what you make of the mess uh the mess we appear to be in well well i have my feelings of what everybody would expect to be i must be that i’ve never known a budget uh course a financial crisis immediately like this i when i listened to the budget i was

Rather astounded by its contents and uh i hope we very rapidly get out of it i i was uh hoping that now we’ve gone through the circus of the leadership election we were now going to get down to dealing with a serious national crisis and i was quite prepared to give them time and wish them success in the national interests but they have made a catastrophic start

The the the the the the budget was a serious mistake and it has caused a serious problem right so the government is blaming international factors i mean you believe this is quite clearly a self-inflicted crisis well it’s an additional crisis of course they’re right that they’ve taken over at a time when they have a lot of very serious problems to deal with and

Economically they have a very unusual combination britain is entering into a recession we’re in a recession now but this recession is being combined with high inflation inflation properties doesn’t occur in recessions inflations more often when you’re in some sort of inflationary boom that has to be quiet and down but they’ve got an inflationary recession and their

Budget was put forward in the apparently naive belief that firstly they had to deliver tax cards so that would give them a good headline the next day and that if you gave tax cuts to the very rich that you would attack really good bankers to london that would get us back to growth and it would trickle down to everybody else well i hope that’s all been torn up and

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That they’re now sitting down listening to the treasury the bank of england and those serious economic economies so i’m sure happy to give them proper advice but we’ve just been hearing from the treasury minister saying these are the right plans because they might they make our economy more competitive we will get on and deliver these plans i didn’t know that i

I was not sharing the criticism of their silence at the moment because i very much hope that they were sitting down carefully and taking proper advice and considering very carefully what they were going to say before they came out and responded and um that that’s uh i i i i think that is a great pity what we needed was a clear statement that they would stick to

Fiscal discipline that of course the problems of inflation were caused by president putin and also by other real problems in supply problems and food supplies throughout the world they couldn’t cure it straight away but they were going to combine in a sensible prudent way getting down inflation with bringing to an end the recession lessening the recession getting

Us back to growth they’ll be re-elected in two years time if they’re judged by then to be competent people will forgive them some mistake so this isn’t quite black wednesday i don’t think but they they’ve now got to demonstrate that their responsibility is heading out on the right course and actually you know where they need to be in two years time the election

Is able to say to people look we were right it worked out all right in the end we’re now beginning to get a bit of growth we’ve got low inflation we’re back on course to become a good modern economy again because the british economy has a lot of underlying strengths we’re not um uh third world country or some country that’s usually in this sort of problem like

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Argentina or greece so it begs the question then why do you think they proceeded in the way they did we had rishi sunak after all warning that what would happen to the pound what would happen to on the guilt markets what would happen to interest rates i voted for rishi suda yes no i think i think they’ve got too much political excitement and hype and hubris uh

After all the rather over frantic over long debate in the leadership election and they were planned straight away to give effect to all the things they’ve been actually warned about by rishi and many others uh and they were mainly heading for the good headlines that they got in the daily mail and the daily express the daily express give me glowing headline at last

A real conservative budget well i don’t think any previous conservative government at least of all margaret thatcher is the most successful we’ve had since the war would have done anything like this although they did make a slight slip under the thatcher government deal with it in in 1988. well that’s the point i mean this is your party this is the party that was

Known uh for economic responsibility or that’s what they said they should be known for yes which is why black wednesdays did such terrible uh harm to us uh then quite lasting harm for quite a long time um but uh we did get the economy back after black wednesday uh blair only got elected because by saying he was going to follow my economic policy which he did for

A couple of years uh stick to my figures if you recall because the economy was the only thing we were in the lead and the polls on in 1997 but we just torn ourselves apart and we continued to do so with a stupid argument over europe uh but that that we were quite unelectable but but the the reason conceptual party has been the governing party for the majority of

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My lifetime has been because it’s always been regarded as safe with the money good on the economy much more reliable than the feckless labor party right just finally what about the position of the chancellor now i mean does it all add up to a resigning matter no i don’t but i like crazy quartering and we can’t keep having a different chance or every other week uh

He’s a good intelligent guy uh he’s just got the stand up to rishi or stand up to the prime minister or the prime minister’s advisors if they’re the source of the problem he’s got to make a really serious statement that he is going to stick to fiscal discipline that we are is going to be a long difficult course with a difficult winter but uh and and he he has got

To make a reassuring statement and the bank mustn’t get left behind the curve again well they’re going to have to raise interest rates they should have raised interest rates yesterday in my opinion not by some panic threaten large huge sum but another half percent just to show there are independent and doing their proper job and both of them need to come out with

Serious solid statements the government and the bank and not just say the letters are know in november we need a restatement of policy and then personally i like crazy i wish him well he’s a highly intelligent guy just learned from this settle down get some calm back and start pursuing a more serious and responsible policy okay lord clark appreciate you coming on

The program thanks very much indeed pleasure

Transcribed from video
Mini-budget was 'serious mistake' – former Tory Chancellor Lord Clarke says By Sky News