Kwasi Kwarteng says 'total focus is on delivering on mini-budget' amid U-turn speculation

The Chancellor said he wants to 'make sure that we get growth back into our economy'

Published Last updated

Chancellor Kwasi Kwarteng said his “total focus is on delivering on the mini-budget” in response to speculation about a U-turn on the measures.

Asked in Washington if there was the possibility of a rethink on cutting corporation tax, he said: “My total focus… is on delivering on the mini-budget and making sure that we get growth back into our economy.

“That’s the central prize, that’s the main focus of my job.”

Asked about discussions in London about scrapping measures in the mini-budget while he was in Washington, Mr Kwarteng added: “I speak to No 10, I speak to the Prime Minister all the time.

Kwasi Kwarteng
Kwasi Kwarteng

“We are totally focused on delivering the growth plan.

“What we were facing was a tax high of 70 years and no growth.”

He said his talks with the International Monetary Fund had illustrated that “growth is a central focus of the international community” and the Government was “quite right to focus on growth”.

“People are talking about some of the ideas that we have put forward,” Mr Kwarteng said.

The mini-budget’s plan to increase borrowing to fund tax cuts caused turmoil on the financial markets, which sent Tory poll ratings plummeting and eventually led to Mr Kwarteng abandoning plans to scrap the 45p rate of income tax for top earners.

Kwasi Kwarteng and Liz Truss
Kwasi Kwarteng and Liz Truss

But reports suggested talks are under way between No 10 and the Treasury on abandoning other elements of the £43 billion tax-cutting plan, including the commitment to axe a planned increase in corporation tax.

While the managing director of the International Monetary Fund (IMF) said it is sometimes right for a “recalibration” of policies.

Speaking at a press conference in Washington, Kristalina Georgieva said: “Our message to everybody, not just the UK, is that at this time, fiscal policy should not undermine monetary policy.”

She added that “it is correct to be led by the evidence, so if the evidence is that there has to be a recalibration, it’s right for governments to do so”.

Ms Georgieva also confirmed IMF leaders have had a “constructive” meeting with Mr Kwarteng after the institution’s chief economist said the UK Government’s tax cuts threatened to cause “problems” for the British economy.

The scale of the backlash to the mini-budget has led to speculation that the Prime Minister’s position could be in jeopardy.

While, in response to speculation about a possible U-turn on corporation tax, the Liberal Democrats have called for Mr Kwarteng to resign.

Lib Dem leader Ed Davey said: “This U-turn would come too late for many struggling families facing mortgage misery.

“The only way to restore credibility is for Kwasi Kwarteng to resign or be sacked. This Chancellor has done enough damage and needs to go.

“His botched budget then needs to be scrapped altogether and replaced with a fair and responsible plan, including emergency support for mortgage borrowers bearing the brunt of this Conservative chaos.

“Too many homeowners are being forced into making heartbreaking decisions because Truss and Kwarteng decided to hand out unfunded tax cuts for the super wealthy.

“They will never forgive the Conservatives for this disastrous experiment, playing fairytale economics with people’s lives.”