Liz Truss admits huge error with tax cuts announcement but refuses to U-turn

Liz Truss has admitted she should have “laid the ground better” after the markets panicked following her emergency tax cut measures last week. The Prime Minister vowed to stick by her ambitious plan for growth but said she appreciated mistakes had been made.

The pound plummeted in value against the dollar following after £45billion if tax cuts were confirmed by Chancellor Kwasi Kwarteng in what was dubbed as a “mini-budget”. It followed a £60billion energy package to help families manage their costs through the winter.

The City was spooked after ministers refused to publish independent growth forecasts alongside the announcements.

Ms Truss said this morning: “I do want to say to people I understand their worries about what has happened this week.

“I do stand by the package we announced and I stand by the fact we announced it quickly, because we had to act.

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“But I do accept we should have laid the ground better.”

She added: “I have learnt from that and I will make sure that in future we do a better job of laying the ground.”

Ahead of the mini-budget, the Government had made clear its intentions to reverse the rise in national insurance contributions and to scrap a planned increase in corporation tax due to take place next year.

But Mr Kwarteng surprised MPs when he also announced he was scrapping the 45p top rate of tax and removing the cap on bankers’ bonuses.

The Prime Minister admitted this morning that even members of the Cabinet were unaware of aspects of the fiscal intervention before it was read out in Parliament.

READ MORE: Liz Truss warned that she could be ‘out by Christmas’

Senior Tories have threatened to launch a rebellion against the measures announced by the Government.

Former Cabinet minister Michael Gove said it was “right” that Ms Truss had conceded to errors but added he remained “profoundly concerned” bu her plans to go ahead with the tax plans.

He warned there appeared to be an “inadequate understanding at the top of Government of the scale of change required”.

The Surrey Heath MP hinted he would vote against the mini-budget in the House of Commons.

Julian Smith, the former chief whip to the Government, added: “The first job of an MP is to act in the interest of their constituents and in the national interest.

“We cannot clap for carers one month and cut tax for millionaires months later.”

Party chairman Jake Berry told Sky News this morning that the mini-budget would be “treated as a vote of confidence” and those who voted against it would lose the right to sit as a Conservative MP.

He added, “although that is a decision for the chief whip, as far as I am concerned, yes” they would lose the whip.

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