The UK’s chancellor, Jeremy Hunt, will discuss the medium-term fiscal plan in a statement that will be made later Monday.
On October 31, the chancellor would release the medium-term fiscal plan with a forecast from the independent Office of Budget Responsibility.
Today, Chancellor Jeremy Hunt will seek to soothe the markets by revealing how he plans to demolish portions of the mini-budget proposed by Liz Truss and Kwasi Kwarteng.
He will outline billions of pounds in cutbacks in an emergency address on Monday to stabilize the national finances.
It was intended to “guarantee that healthy public finances support economic development.”
The decision will be seen as an effort to calm the financial markets after weeks of turbulence caused by former chancellor Kwasi Kwarteng’s mini-budget tax giveaway.
Following his unexpected appointment on Friday, Mr. Hunt dismantled Ms. Truss and Mr. Kwarteng’s earlier economic blueprint to reduce taxes to stimulate economic development.
Last night, the chancellor briefed the Bank of England governor and the Debt Management Office head on his proposals.
After crisis talks at Chequers over their new fiscal plan on Sunday, Jeremy Hunt insisted that Liz Truss was still “in charge” as prime minister despite her increasingly precarious position. He also warned of further public spending cuts and did not rule out the possibility of other U-turns on her disastrous mini-budget, including eliminating the 1p amount to the income tax base rate.
Hunt spent the weekend attempting to reassure the public that the government was in charge of the economy. Despite this, he presented a bleak image of what it would take to stabilize the economy after a few weeks in which the government abandoned plans to reduce the 45p top income tax rate and freeze corporate tax. It is believed that he is contemplating delaying by one year his promises to reduce the income tax by one cent next April.
Treasury insiders acknowledged that even defense expenditure, which Truss had pledged to boost by 3 percent of GDP, and the health service would be subject to cutbacks. It is believed that the Office for Budget Responsibility has detected a £72bn black hole in the public budget, which is higher than the £62bn reported by the Institute for Fiscal Studies last week.
Truss is struggling for her political life, with Conservative MPs threatening to unseat her and even friends saying she has only days to turn around her leadership after tearing up her economic policy and selecting Hunt as chancellor following the dismissal of Kwasi Kwarteng.
Mr. Hunt can calm the ship, but he cautioned that if “it fails to please the markets and everyone else, and the economy remains in disorder, then I believe we will be in a very precarious position.”
After merely a few weeks in office, it seems to many observers that the Prime Minister’s resignation is imminent.
This afternoon, Hunt will also provide a report to the House of Commons.
The decision will be seen as an effort to calm the financial markets after weeks of upheaval caused by the outgoing chancellor’s £45 billion ($50,3 billion) mini-budget tax giveaway.