A pact between ex-Finance Minister Rishi Sunak and Tory leader Penny Mordaunt is also possible, the Times reported, citing senior party members. Both had failed in the internal competition for party leadership because of Truss. A “council of elders” made up of dozens of former cabinet members is ready to ask Truss to give up.
In addition to the financial world and the media, the prime minister has also been facing harsh criticism from within her own ranks for weeks. The reason for this is Finance Minister Kwasi Kwarteng’s budget, which was only financed with debt and which triggered severe market turbulence. The government’s financial plan had unsettled the country’s markets, drawing negative reactions and prompting the Bank of England to intervene. The British pound fell to an unprecedentedly low level against the dollar, and government bond yields shot up.
Truss on a lurching course
After fierce protests, including from leading Tories, Truss and Kwarteng reversed the abolition of the top tax rate. Experts also see a lurching course in corporate tax. As the newspaper “Guardian” wrote, Truss and Kwarteng do not want to withdraw the significant increase in corporate tax planned for April. The Prime Minister had repeatedly stressed that the increase from 19 to 25 percent decided by her predecessor Boris Johnson would be canceled again. That would be another reversal.
Truss said in her second appearance at Parliament’s Question Time on Wednesday that she “absolutely” stands by her campaign promises. Truss assured the House of Commons that, despite the tax cuts, her government would ensure “that the national debt falls in the medium term”. The point is not to cut public spending, but to spend the money “well”. Truss said her economic plan, presented by Finance Minister Kwarteng, will result in “more growth and lower inflation.”
All eyes on Kwarteng
The head of the opposition Labor Party, Keir Starmer, accused Truss on Wednesday in the House of Commons of denying reality and not taking responsibility for the looming financial crisis. Instead, she points to the war in Ukraine and other factors affecting the global economy.
Kwarteng, meanwhile, broke off his stay at the finance ministers’ meeting in Washington early in order to return to London. The British finance minister told reporters in Washington. People familiar with the matter said he intends to continue his work on his government’s medium-term financial plan. Kwarteng will announce the budget plans on October 31st.
Won internal election with right-wing positions
In addition to the financial markets, Truss’s course is not popular with the voters either. In a survey by the opinion research institute YouGov for the “Times”, 50 percent were in favor of deposing Truss, only 9 percent supported the head of government. Truss was elected in an internal party vote with 57.4 percent of the votes, her rival Sunak came to 42.6 percent.
Truss is assigned to the right wing of the party, she scored points with her tax proposals in the internal election campaign for the successor to the party leadership. She also scored points with the party’s grassroots – which is significantly older, more male and wealthier than the average British population – with a confrontational stance towards the EU and populist statements on refugees, left-wingers, environmental activists and social minorities. Truss was once considered a staunch opponent of Brexit.
King Charles received Truss: “Oh dear, oh dear”
Truss was also not exactly flattered by her recent visit to King Charles III. Only a little over a month on the throne, Charles already has a reputation for slipping out of character in front of the camera. After cursing about a leaking fountain pen at the ceremonies for his proclamation as the new king, he now attracted attention with an unflattering comment to Truss.
Charles greeted the Prime Minister at the weekly audience at Buckingham Palace on Wednesday, according to a video broadcast by British broadcaster ITV: “Back again. Oh dear, oh dear.” Truss had previously curtsied, shook his hand and said, “Your Majesty, nice to see you.”
The relationship between Truss, who came into office just days before the Queen’s death, and the king is said to be strained. What caused a stir was that Charles, who had been a lifelong advocate of climate protection, had to cancel his participation in the UN World Climate Conference next month at the request of the government. In contrast to her predecessor Johnson, Truss has put the issue of climate protection on the back burner and likes to rail against wind power and solar systems.