Liz Truss reverses National Insurance hike giving Britons £330 a year boost to income

Liz Truss has unveiled legislation to reverse the National Insurance hike imposed by Rishi Sunak. Ministers have tabled a Bill to undo the increase to allow British workers to keep more of their money.

It means almost 28 million people will keep an extra £330 on average next year. At the same time it will reduce tax for 920,000 businesses by nearly £10,000 on average next year as they will no longer pay a higher level of employer National Insurance.

The 1.25 percentage point rise in National Insurance will be reversed from 6 November, Chancellor Kwasi Kwarteng announced.

He said: “Taxing our way to prosperity has never worked.

“To raise living standards for all, we need to be unapologetic about growing our economy.

“Cutting tax is crucial to this – and whether businesses reinvest freed-up cash into new machinery, lower prices on shop floors or increased staff wages, the reversal of the Levy will help them grow, whilst also allowing the British public to keep more of what they earn.”

The announcement comes ahead of a fiscal statement in the House of Commons tomorrow. Mr Kwarteng is set to outline plans to MPs for Truss’s pro-growth agenda.

On top of reversing the national insurance rise, the Government is to cancel a planned increase in corporation tax, remove a cap on bankers’ bonuses, and is even considering a cut on stamp duty.

Scrapping the national insurance tax rise, which broke a commitment made in the Conservative Party manifesto in 2019, was a core pledge to Ms Truss’s leadership bid.

She pledged to u-turn on the increase introduced by Mr Sunak when he was Prime Minister within a month of entering No10.

She told Tory members she would “hit the ground running” and take swift action to “immediately tackle the cost-of-living crisis by cutting taxes, reversing the rise on national insurance and suspending the green levy on energy bills”.

The Treasury said most employees will receive a cut to their national insurance contribution directly via their employer’s payroll in their November pay, although some may be delayed to December or January.

The levy was expected to raise around £13 billion a year to fund social care and deal with the NHS backlog which has built up due to the Covid pandemic.

However, Mr Kwarteng said funding for health and social care services will be maintained at the same level as if it was still in place.

The Chancellor and Prime Minister Liz Truss have argued that the lost revenues will be recovered through higher economic growth stimulated by the cuts in taxation.

Responding to the announcement, John O’Connell, chief executive of the TaxPayers’ Alliance, said: “It’s long past time that the government abandoned this punishing tax hike on working people and employers alike.

“It never made any sense to introduce a tax which would see a huge hit to jobs and growth, just as the country was trying to get back on its feet.

“The chancellor should go further on Friday and ensure this mini-budget is a growth game-changer.”

However, critics have questioned the Prime Minister’s economic plan, with the Institute for Fiscal Studies saying it is “a gamble at best” and that ministers risked putting the public finances on an “unsustainable path”.

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  • 1 минута назад 04.10.2022Politics
    NHS staff gap could be filled by foreign workers as Therese Coffey tackles backlogs

    Therese Coffey has admitted that a staff shortage in the NHS could be filled with foreign workers as she stressed the need for the “right number” of people working in the health service. There are currently 6.7 million people on NHS waiting lists in England.

    Ms Coffey has unveiled an alphabetical list of targets for her department to work on, with “backlogs” represented by the letter B.

    She has also said any GP failing to offer a non-urgent appointment within two weeks will be put on display in a “league table”-like structure to show which practices have the longest wait times.

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    When asked if her methods were too harsh she countered: “It’s not about criticising, it’s about: ‘This one’s doing brilliantly this other one isn’t.’

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  • 1 минута назад 04.10.2022Politics
    Cabinet lashes out at ‘disloyal’ Michael Gove for rebellion threat

    One senior member of Liz Truss’s top team likened him to a scorpion whose only job is to sting, even if it means taking himself down as well as the party. Before the U-turn on the 45p top rate tax cut, Mr Gove had provoked Tory fury by calling for the Prime Minister and Kwasi Kwarteng to ditch the measure in a series of incendiary interviews.

    Emotions boiled over with one Cabinet Secretary telling the Daily Express they weren’t surprised by Mr Gove’s actions because he is a “disloyal ****”.

    They compared the former minister to the deadly eight-legged creature in the Scorpion and the Frog – a fable which teaches that vicious people cannot resist hurting others, even when it is not in their own interests.

    When told about Mr Gove’s remarks another senior Cabinet Minister used the same four-letter expletive.

    The row and the fallout from the change in policy has overshadowed the Conservative Party conference in Birmingham.

    Jacob Rees-Mogg yesterday called Mr Gove “the Tory Party’s version of Peter

    Mandelson” in reference to the former Labour MP’s reputation in the “dark arts” of politics.

    Asked at a fringe event if Mr Gove is a thorn in the side of the Government, the Business Secretary replied: “No, no. He’s too polite to be a thorn. He’s a very elegant thorn if he is a thorn, no, no, no.

    “Michael is one of the cleverest men in politics, a very amiable figure, who loves the art of politics. He’s the sort of Tory Party’s version of Peter Mandelson.”

    Meanwhile, at a separate event at the conference, Mr Gove said the atmosphere this year was a bit “different”.

    He added: “There is a different atmosphere, but that is because we have a different Prime Minister and also because the world faces a set of crises even more acute in this autumn than it did last.

    “We are operating against that backdrop.”

    It is not the first time Mr Gove has been likened to a predatory animal, with allies of former PM Boris Johnson branding him a “snake” earlier this year.

    The description dates back to when he blew up Mr Johnson’s 2016 leadership bid and then stood in the contest himself.

    Mr Johnson sacked him from the Cabinet in the final hours of the ministerial revolt he faced in July.

  • 2 часа, 1 минута назад 04.10.2022Politics
    Kwasi Kwarteng admits tax cuts sparked ‘turbulence’ over past 10 days

    Kwasi Kwarteng urged Tories to “focus on the task in hand” as he battled to restore his authority as Chancellor after a dramatic U-turn over tax cuts for the rich. Just hours before his set piece speech at the Conservative Party conference Mr Kwarteng abandoned his plan to scrap the 45p income tax rate for people earning more than £150,000 to stave off a mounting Tory revolt. Addressing the audience in Birmingham he acknowledged it had been a “tough” day but promised there would be no more distractions.

    Downing Street said Prime Minister Liz Truss – who was in the audience for the speech – continues to have confidence in Mr Kwarteng, despite the humiliating decision to drop the tax cut.

    Mr Kwarteng told activists: “What a day. It has been tough but we need to focus on the job in hand.

    “We need to move forward, no more distractions, we have a plan and we need to get on and deliver it.”

    He acknowledged “the plan put forward only 10 days ago has caused a little turbulence”.

    The Chancellor’s mini-budget triggered turmoil in the City, was criticised by the International Monetary Fund and resulted in a £65 billion emergency intervention by the Bank of England to restore order.

    But it was the 45p rate which attracted the biggest political backlash, with the Tories viewed as offering help to the rich while the country faced a cost-of-living crisis.

    “I get it. I get it,” Mr Kwarteng said.

    “We are listening and have listened, and now I want to focus on delivering the major parts of our growth package.”

    Mr Kwarteng used his speech to defend the Government’s plan to cut taxes in the search for economic growth.

    Despite the U-turn on the 45p rate, Mr Kwarteng is still committed to taking 1p off the basic rate of income tax, reversing April’s increase in national insurance and scrapping the planned increase in corporation tax.

    The Chancellor told the conference: “While we all believe in growth, we as Conservatives also believe that it is an important principle that people should keep more of the money they earn.

    “I don’t need to tell you that. That isn’t radical, that isn’t irresponsible. It is a deeply held belief that we all share as Conservatives.

    “We were faced with a 70-year high tax burden. We were confronted with low growth and the path we were on was clearly unsustainable. So that’s why we’re cutting taxes for working people.”

    He earlier acknowledged that the Government’s desire to borrow billions to axe the 45p rate on earnings over £150,000 had become a “terrible distraction” amid widespread criticism.

    Shortly before he had been due to tell the conference they must “stay the course” on the plans, he issued a statement saying: “We are not proceeding with the abolition of the 45p tax rate.”

    “We get it, and we have listened,” he added, in language echoed in a tweet from the Prime Minister less than 24 hours after she said she remained absolutely committed to the cut.

  • 2 часа, 1 минута назад 04.10.2022Politics
    Liz Truss ‘betrayed conservatism’ by being ‘laziest left-wing caricature’ of Tory

    Liz Truss has been accused of “betraying conservatism” by adopting the “laziest Left-wing caricatures of Toryism” as her “roadmap”. Less than a month into the role, some commentators are suggesting the Prime Minister could already be leading her party towards defeat.

    The former Liberal Democrat is likely hoping her party’s conference will help to cover over cracks which have appeared in her first weeks as office.

    But some are suggesting the Prime Minister’s troubles lie deeper than her response to the fast-paced issues of the day.

    UnHerd Foreign Affairs Editor Aris Roussinos has argued is it Ms Truss’s vision – or lack thereof – that is pushing the Conservative Party towards electoral defeat.

    He described the Tory leader as “a career politician who seems to view the laziest Left-wing caricatures of Toryism as a political roadmap: a pure zealot of unrestrained capital with no vision of the good beyond libertarian think tank pamphlets and a burning faith in the might and power of the market’s invisible hand”.

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    This line echoes that of Brexiteer and trade unionist Paul Embery who last week argued the Prime Minister was “listening to” free market groups like the Institute for Economic Affairs rather than social conservative commentators like Nick Timothy.

    He added that, having done this, the party has “alienated their new electoral constituency”.

    Mr Embery’s comments followed the publication of data which suggested the Tory party has moved further from its base since 2019.

    Analysis by the Financial Times suggested that Tory voters are typically more left wing when it comes to economics and more traditional regarding social values.

    It added that since the 2019 election, after which Boris Johnson thanked so-called ‘Red Wall’ voters for lending the Tory party their support, the Tories have moved further away from their voters, becoming more right wing economically and more progressive regarding social values.

    Even before this shift, the parliamentary party was some distance from its voter base, according to the FT research.

    Mr Roussinos commented: “The Conservatives were elected on a simple mandate to reform Britain’s failing economic model and slash our current, record-high levels of immigration; instead, Truss is doubling down on both.”

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    The Prime Minister is considering further loosening immigration rules in an attempt to boost the economy, according to reports.

    A Number 10 source told the Sun: “We need to put measures in place so that we have the right skills that the economy, including the rural economy, needs to stimulate growth.

    “That will involve increasing numbers in some areas and decreasing in others. As the Prime Minister has made clear, we also want to see people who are economically inactive get back into work.”

    Any such plan would likely prompt anger across many areas of the UK, with voters repeatedly expressing their frustration over years of high immigration numbers into the country.

    Brexit is argued to have become a byword for immigration in the run-up to the 2016 vote, pointing to the salience of the topic.

    Writing on her first weeks in power, Mr Roussinos concluded that “in choosing Truss, the Conservative Party chose to make the Tory case for Labour”.

  • 2 часа, 1 минута назад 04.10.2022Politics
    Beleaguered PM Liz Truss dealt another blow as new poll sees Labour grab 25-point lead

    Liz Truss has been dealt another devastating blow for her leadership while at the Tory conference in Birmingham as a new poll has revealed Labour has a 25-point lead over her party. On a day where the Prime Minister had to cave in to demands she ditch plans to scrap the 45p income tax top rate, the poll by Savanta ComRes put Labour on 50 points – up seven to the Tories’ 25 points – which was down four.

    The ComRes findings follow two late last week which also suggested the Tories are heading for an election wipeout.

    YouGov gave Labour an unprecedented 33 point lead which would leave the Conservatives on a mere three seats according to the prediction website Electoral Calculus.

    Meanwhile, the Techne UK tracker poll for Express.co.uk gave Labour a 20 point lead which would leave the Tories with just 113 seats, worse than their outcome in the 1997 general election when Tony Blair woon a 179 seat majority.

    Chris Hopkins, Political Research Director at Savanta ComRes said: “Large Labour leads are now becoming commonplace, and this 25pt lead is the largest in Savanta ComRes history.

    “If this played out at a General Election, the Conservative Party could be pretty much wiped out, and Labour would have such a commanding lead it could put the Conservatives out of power for generations.”

    According to Electoral Calculus if the ComRes poll was the result in an election, Liz Truss’ party would be reduced to 32 seats while Labour would have 526 giving Sir Keir Starmer a majority of 402.

    This would enable Labour to take the UK back into the EU unopposed without needing to get help from the Lib Dems or SNP.

    Savanta ComRes interviewed 2,113 UK adults aged over 18 online from 30 September – 2 October before Ms Truss performed her U-turn on 45p rate.

    The decision though has sent Tories into a tailspin at their conference in Birmingham with different factions criticising the Government for making the policy in the first place oor dropping the policy.

    Questions have been asked about the future of Chancellor Kwasi Kwarteng with Brexiteer Sir John Redwood being proposed as a replacement.

    Ms Truss has found herself under siege from supporters of her rival former Chancellor Rishi Sunak led by Michael Gove and Grant Shapps.

    Gove and Shapps engineered a rebellion against cutting the 45p rate yesterday which meant that the Prime Minister was staring at a defeat in Parliament.

    Meanwhile, former cabinet minister Nadine Dorries, who supported Ms Truss’ leadership bid, has also attacked her and demanded she call an election.

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  • 2 часа, 1 минута назад 04.10.2022Politics
    Johnny Mercer launches blistering attack on Truss as he breaks silence after sacking

    Johnny Mercer has launched a furious tirade against Liz Truss a month on from his sacking. The Plymouth Moor View MP was removed as veterans affairs minister during a major Government reshuffle by the Prime Minister last month.

    In a Facebook post this evening, Mr Mercer admitted he had found the “recent turn of events surprisingly tougher to deal with than I expected”.

    In a blistering attack as the Tory conference in Birmingham is underway, the former soldier said: “Of course I have a view on what is going on in Government, and you can guess what it is.

    “You know I will not accept budgets like the one we saw last week.

    “It is hard watching these rather comedic figures masquerading as Government Ministers sprawling around in the media.”

    Mr Mercer vowed to speak out in the Commons and defiantly added that the Tories can “do whatever they like with the whip”.

    He said: “It is deeply unfunny for normal people, and I will waste no time in letting them know in the Commons at the first opportunity.

    “I will not support anything that doesn’t help the brilliant people of Plymouth through intensely difficult times – they can do whatever they like with the whip.”

    Mr Mercer continued: “Yes, veterans have been a large part of my work, but achieving tangible things for Plymouth has always been my higher priority, although I accept I have not always demonstrated that enough, and now I have a chance to really go to town on both in my remaining time in office.”

    It comes after Mr Mercer’s wife branded Ms Truss an “imbecile” in an outburst the day of his sacking on September 6.

    Felicity Cornelius-Mercer tweeted a picture mocking the Prime Minister as a character from The Muppets TV show.

    She said: “He asked her ‘why would you do this, who is going to be better at this role than me, which of your mates gets the job, you promised a meritocracy?’

    “PM – I can’t answer that Johnny. This system stinks and treats people appallingly. Best person I know sacked by an imbecile Liz Truss.”

    Mr Mercer, who did not say who he was backing in the Tory leadership race over the summer, had tweeted a lengthy statement saying he was “disappointed” but accepted the Prime Minister is “entitled to reward her supporters”.

    He also suggested he could quit the Commons, saying: “I have to accept that I will never possess the qualities required for enduring success in politics as it stands, and to be fair to my wonderful family, I must consider my future.”

    He added: “I will be spending time with my family and doing no media requests.”

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Politics Liz Truss reverses National Insurance hike giving Britons £330 a year boost to income