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As Liz Truss Reveals Her Plans for the Economy, Labour Shifts Closer to Power

  • Writer: Amer Loubani
    Amer Loubani
  • Oct 4, 2022
  • 3 min read


Apart from a much needed cap on energy bills which will no doubt bring relief to many UK households, the new prime minister Liz Truss has admitted to Sky News she is targeting tax cuts that will “disproportionately benefit the rich” to grow the economy. This comes after Truss already dismissed concerns that her government is more comfortable borrowing to fund the new cap on energy bills rather than tax energy companies in the UK – who’s revenues are forecasted to reach £170 billion in excess profit.


She was also forced to defend the governments actions when chancellor Kwasi Kwarteng announced the scrapping of caps on bankers bonuses as well as the abolition of the highest rate of tax (45%) on Friday 23/09 as part of a "Mini budget". All of these strategies are part of supposed plans to continue growing the UK economy as Truss and her cabinet believe it is the best way to trigger wage growth and increased investment in towns and cities. Instead it has led to the weakening of the pound as well as a shock of confidence in the UK as a financial partner. Truss admitted herself that these policies might cause her government to be deeply unpopular.


Kier Starmer described the UK government’s reluctance to touch energy company profits to help suffering households as “The same story regardless of who the Conservative leader is". He later called on the government to abandon the mini budget in its entirety. He may have a point. Across the 4 Conservative leaders the country has seen in 6 years, the principles have remained much the same. A strong reluctance to step on the turf of big business, mixed with what the Labour leader believes is loading the working people with the costs of temporary relief have been the headline trends. The UK has already undertaken intense borrowing to fund the furlough scheme, among other Covid-19 measures that the BBC estimates topped £400bn. It seems irresponsible that the UK government should seek to borrow more to fund measures against a crisis that has helped energy companies gain billions in revenue. Add to this the massive tax cuts announced on the 23rd, and it becomes difficult to explain how the Conservatives will balance the UK’s budget moving forward. This will inevitably lead to a downturn in government spending, at a time where the NHS sorely needs support over the winter, and the towns and cities in the UK who voted for Johnson last time out await the promised “Levelling up” written into his government’s manifesto.


Following the recent Labour conference, a YouGov/Times poll placed the party 33 points ahead of the Conservatives. This is the largest lead recorded by a party since 1998, a damning indictment to a new prime minister who has set her party's popularity back to a worse extent then the most ridiculous days of the Johnson premiership. As time ticks down toward the next election, the conservatives must hope that these new policies deliver in some way or another. The more likely outcome right now is they will find themselves in opposition for the first time since 2010. As I release this, Liz Truss has already ordered the reversal of the 45% tax rate abolition, and may repeal more of her governments budget measures shortly. A painful winter lies ahead.


Author: My name is Amer, I'm a Computer Science with Business graduate currently working in tech consulting. My thoughts in this blog are based on my opinions regarding UK government policy, and any info about specific policies comes from sources listed below. Feel free to reach out to me via LinkedIn (on the about page) if you have any questions.


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