Kwasi Kwarteng defends tax policies as markets reel, saying he had ‘no other choice’ – UK politics live

Like the chancellor, the prime minister has used a Saturday newspaper column to defend the government’s course of action.

In the face of fierce criticism, including a stinging rebuke from the IMF, Liz Truss has admitted that the mini-budget delivered by her government last week did cause “disruption”, after it was followed by a series of economic shocks, including the pound falling to an all-time low against the dollar.

Writing in the Sun, Truss failed to address the changes to the 45p rate, or the scrapping of bankers’ bonuses, which was also included in Kwarteng’s announcements. She said:

For too long we have been stuck debating how to divide up the economic pie, rather than grow the pie so everyone has a bigger slice.

The status quo is not working. For too long we have been held back by low growth and high taxes. We need to get things done in this country more quickly.

So I am going to do things differently. It involves difficult decisions and does involve disruption in the short term.

Not everyone will like what we are doing, but I want to reassure the public that the government has a clear plan that I believe is right for the country.

Earlier on Friday, she had told broadcasters:

I recognise there has been disruption but it was really, really important we were able to get help to families as soon as possible.

What is important to me is that we get Britain’s economy back on track, that we keep taxes low, that we encourage investment into our country and that we get through these difficult times.

Good morning. As the fall-out from the chancellor’s mini-budget continues, with the pound tumbling and markets reeling, Kwasi Kwarteng has attempted to defend the government’s course of action.

Writing in the Daily Telegraph, he said:

The British taxpayer expects their government to work as efficiently and effectively and possible, and we will deliver on that expectation.

Not all the measures we announced last week will be universally popular. But we had to do something different.

We had no other choice.

His announcements just over a week ago included a cut in income tax from 45p to 40p in the pound for the highest earners. Other taxpayers received a 1p cut in income tax and will get money from a U-turn in the rise in national insurance. The chancellor said they would all help to increase growth.

However there was a strong market reaction to the package, which amounted to the biggest tax cuts in 50 years. The Bank of England subsequently spent billions of pounds buying government debt to shore up pensions schemes. It has also indicated that interest rates are like to rise significantly, which has led to jumps in mortgage rates and lenders pulling many deals.

Responding to the markets’ reaction, Kwarteng added:

Even in the face of extreme volatility in global markets, with major currencies wrestling an incredibly strong US dollar, we will show financial markets and investors that our plan is sound, credible and will work to drive growth.

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