BBC presenter Laura Kuenssberg challenged Liz Truss to defend her economic agenda during a tense interview in Birmingham on Sunday. Ms Kuenssberg pointed to a graph which showed that the cost of Government borrowing has spiked as a “direct result” of Number 10’s economic interventions. Ms Kuenssberg told the Prime Minister: “That is a spike in the cost of borrowing for the government which feeds through to everybody else as a direct result of the decisions that you announced on September 23.
“This is not about what was going on in the war in Ukraine already. We know that that’s a huge challenge.
“But look at the direct result on that day and the chief economist at the Bank of England…”
Ms Truss interrupted: “That is not the same as interest rates, though Laura, I think the audience should be clear that that’s not the same as interest rates which are rightly set by the independent Bank of England.
“But it is about the cost of government borrowing and that feeds through to so many other things,” replied Ms Kuenssberg.
The Prime Minister’s attempts to defend her position, arguing that the price of government debt was not the same as interest rates, was branded “bizarre” by ITV’s Robert Peston on Twitter.
As the Conservative Party conference gets under way in Birmingham, Ms Truss faces a difficult task in reassuring the markets and Tory members unnerved by the market turbulence and opinion poll crash suffered since she took office.
“I do want to say to people I understand their worries about what has happened this week,” she told the BBC’s Sunday With Laura Kuenssberg.
“I do stand by the package we announced and I stand by the fact we announced it quickly, because we had to act.
“But I do accept we should have laid the ground better… I have learnt from that and I will make sure that in future we do a better job of laying the ground.”
But she refused to give the same guarantee for benefits and government departmental budgets.
Not ruling out rowing back on Boris Johnson’s promise to raise benefit payments in line with inflation, she said: “This is something the Department of Work and Pensions Secretary [Chloe Smith] is looking at at the moment. She will make a determination on that and we will announce that this autumn.”
Ms Truss defended the dramatic break with past Conservative policy on stewardship of the public finances despite not having her own mandate at a general election.
She said people had voted for a “different future” in 2019, with hopes for investment in towns and cities, higher wages and economic growth.