We’re back – what’s changed? The Conservative leadership contest limps on. Liz Truss remains on course to become the UK’s next prime minister and the cost-of-living crisis is set to worsen. Plus ça change.
At least the end is nigh: the new Tory leader will be announced on Monday 5 September and the Queen will appoint them prime minister the following day. The first few months of Truss’s premiership (assuming that she does win and the polls aren’t mistaken) will be crucial to the government’s response to the cost-of-living crisis. Nonetheless, the contradictory reports surfacing in the papers suggest Truss has not yet settled on a plan.
Truss’s commitment to tax cuts instead of “handouts” is unlikely to survive contact with reality. One mooted proposal includes cutting VAT by between 5 and 10 per cent at a cost of between £38bn and £60bn – much more than Labour’s £29bn plan to freeze energy prices. The policy has been widely criticised by economists such as Paul Johnson, director of the Institute for Fiscal Studies, who say it would stoke inflation and fail to target the most in need. It seems increasingly likely that Truss will have to go far beyond her promise to cut national insurance and suspend green levies on energy bills.
An interesting poll for the Times over the bank holiday suggested 47 per cent of Tory voters favoured nationalising energy companies, which is yet another sign that Truss will have to move to the centre ground after spending the summer addressing the relatively right-wing Tory party members.
In any case, whether Truss could get her plans through parliament is not certain. Yes, the government has a healthy majority in the Commons, but in the House of Lords, where the Conservatives do not have a majority, convention states that peers do not have to pass bills that weren’t contained in the governing party’s manifesto. Add to that the fact that the majority of Conservative MPs didn’t want Truss to become leader, and the toxicity of the leadership campaign, and Prime Minister Truss might have a tricky return to parliament next week.
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