Tory Latest: Hunt Says UK Has No Fiscal Headroom for Tax Cuts

2023-10-02 15:49

Chancellor of the Exchequer Jeremy Hunt told Bloomberg TV the UK has no fiscal headroom for tax cuts

Chancellor of the Exchequer Jeremy Hunt told Bloomberg TV the UK has no fiscal headroom for tax cuts and that reducing the burden on Britons now would be inflationary.

Hunt is the headline speaker at the Tory party conference in Manchester on Monday, and is due to unveil a promise to raise the national living wage while reviewing sanctions for benefits claimants to push more people back into work.

But Conservative colleagues want bolder moves before Britons go to the polls, including cutting the highest tax burden since World War II. Hunt also told Bloomberg no decision has been made on whether the flagship HS2 high-speed rail link would be built to Manchester.

Read More: UK’s Hunt to Offer Wage Boost for Lowest-Paid Amid Tax Cut Calls

Key Developments, Stories:

Senior Tories including Truss, Patel say taxes should come down
Hunt vows to raise national living wage to at least £11/hour
Sunak Faces Cabinet Split on Taking UK Out of Human Rights Pact
After a Year as PM, We Get the ‘Real Rishi’: Adrian Wooldridge

(All times UK)

Hunt: Debt Payments Limit Space for Tax Cuts (7:40 a.m.)

Chancellor of the Exchequer Jeremy Hunt said Britain’s debt interest bill has risen markedly since his spring budget due to higher interest rates, and those costs limit his space for tax cuts.

“Our debt interest payments as a country have gone up dramatically,” Hunt told BBC TV on Monday. “I don’t know what’s going to happen in the spring or next year.”

Hunt Ducks Questions on Future of HS2 Rail (7:35 a.m.)

Another key topic at the Tory conference in Manchester is whether the government is preparing to scrap the planned northern leg of the flagship HS2 high-speed rail project to the city from Birmingham.

Chancellor of the Exchequer Jeremy Hunt batted away questions on the future of the UK’s HS2 rail project on Sky News, saying an announcement will be made at the “appropriate time.” But he also said that costs for the project are ten times higher than building high speed rail in France.

He later told the BBC he took a British Airways flight from London to Manchester for the conference, because his scheduled train was canceled due to strikes.

Read More; Sunak Refuses to Commit to UK HS2 Rail Project as Costs Rise

Hunt: Don’t Know If Pre-Election Tax Cuts Possible (7:15 a.m.)

Chancellor of the Exchequer Jeremy Hunt said he couldn’t guarantee he’d be able to cut taxes before the next general election, even as a clamor grows within his Conservative Party to do so.

“We don’t know whether that’s going to be possible,” Hunt said on Times Radio on Monday. He said tax cuts now would be inflationary and undermine the government’s efforts to curb rising prices.

Hunt also said he doesn’t plan to run again to be Tory leader, saying “I’m completely cured of that.”

Hunt Vows to Raise UK’s National Living Wage (Earlier)

Chancellor of the Exchequer Jeremy Hunt will pledge to raise wages for the UK’s lowest-paid workers in his speech to the conference on Monday.

The UK will increase the national living wage to at least £11 ($13.42) an hour from £10.42, Hunt is due to say on Monday at the Tory Party conference, according to an e-mailed statement. That will increase annual earnings for full-time workers by at least £1,000.

At the same time, the government will crack down on welfare claimants with a review of the sanctions regime in order to encourage more people to return to work. “Those who won’t even look for work do not deserve the same benefits as people trying hard to do the right thing,” the chancellor is due to say. (Joe Mayes)

Badenoch Says Sunak Was “Brave” to Retreat on Net Zero (Earlier)

Business Secretary Kemi Badenoch will call Rishi Sunak “brave” for “shattering a lazy consensus about the costs of net zero” after the prime minister last month pushed back deadlines for ending the sale of petrol-fueled vehicles and eased the push to replace gas boilers in homes.

Badenoch, hotly tipped to put herself forward for the Party leadership a second time if Sunak loses the next election, will hail Sunak’s ability to not “dance to the tune of the metropolitan bubble on energy policy” in her speech to the conference on Monday.

She will also dismiss economic models that demonstrate the negative impact Brexit has had on the economy. ”I’m here to set the record straight,” she will say. “They tell you Brexit is costing Britain 4% of GDP per year. WRONG.” The 4% figure stems from analysis by the government’s own fiscal adviser, the Office for Budget Responsibility.