It has been a tough week for newly elected British Prime Minister Liz Truss as her economic policies have come under severe criticism. Following up on campaign promises, finance minister Kwasi Kwarteng announced massive tax cuts in the mini-budget earlier this week but that was followed by the pound reaching an all-time low against the US dollar and the country facing a more acute economic crisis.
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According to The Guardian, things are only getting worse as sources claimed that Truss and Kwarteng had a major argument on how to respond to the current situation. Sources in the civil service claimed that all was not well between the two leaders and later, Sky News said that Truss decided to not go with Kwarteng’s suggestion of making an official Treasury statement in an attempt to reassure the markets.
Downing Street has completely dismissed the reports by calling them “nonsense”. The official statement stated that Truss meets Kwarteng every day and there is no rift between them.
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Both Truss and Kwarteng have been working together for quite some time now and they expanded on their economic vision in a book called “Britannia Unchained” which was released in 2012. The tax cuts were also planned by both leaders but the reactions to them have left them in a tough position.
In the aftermath of the announcements, the pound lost almost five per cent to reach $1.0327 – the lowest since 1971. However, Kwarteng played down the impact by saying that the government was concentrating on long-term gains rather than short-term goals.
