Latest updates: chancellor says ‘we’ve learned that you can’t fund spending or borrowing without showing how you are going to pay for it’
Good morning. We’ve got less than a week to go now until the autumn statement – in effect, the second budget of the autumn – and already a blame game has broken out in the Conservative party about who is responsible for the massive spending cuts and tax rises the nation is about to face.
In an interview with Talk TV last night, his first since he was sacked as chancellor, Kwasi Kwarteng, rejected claims that his mini-budget was primarily to blame. When it was put to him that Rishi Sunak and Jeremy Hunt, the new chancellor, were going to blame him for all the problems, Kwarteng replied:
You know, the only thing that they could possibly blame us for is the interest rates and interest rates have come down and the gilt rates have come down. The black hole and structural problems are already there. I mean, it wasn’t that the national debt was created by Liz Truss’s 44 days in government.
The national debt wasn’t radically changed by Liz Truss … There isn’t a black hole and the interest rates and the gilt rate funding the debt is exactly the same as it was before the mini-budget. So the black hole hasn’t been caused by the mini budget. It’s something that Jeremy and Rishi and their officials are going to have to tackle on their own regardless of what happened in the budget.
All I would say is that when we produced a fiscal statement that didn’t show how we were going to bring our debts down over the medium term, the markets reacted very badly and so we have learned that you can’t fund either spending or borrowing without showing how you are going to pay for it and that is what I will do.
