RISHI Sunak will deliver a major speech on the economy this morning, ahead of Wednesday’s long-awaited Autumn Statement.
At a college in North London, the PM will outline the state of Britain’s economy and lay the groundwork for any imminent tax and spending changes.
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With inflation now sitting at 4.6 per cent, Mr Sunak will tell Brits there is light at the end of the cost of living crisis tunnel is near.
The Autumn Statement is set to be one of the final chances for Mr Sunak and Jeremy Hunt to try and win over voters using economic policy.
It’s also a critical opportunity for the PM to placate frustrated backbenchers who are angry that the UK’s tax burden is at its highest since the Second World War.
Over the weekend Mr Hunt vowed to harness Britain’s entrepreneurial spirit to create a “fizzing” place to do business.
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The Chancellor fuelled speculation it was time to cut business levies in a bid to boost growth after saying the tax burden was “too high”.
The move came as it emerged he was considering last-minute cuts to income tax and national insurance after being given extra spending power.
Mr Hunt told Sky News: “I think it’s important for a productive, dynamic, fizzing economy that you motivate people to do the work, to take the risks that we need.”
He outlined how his priority is to back British business adding that “lower tax is essential to economic growth”.
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Mr Hunt expressed his frustration over too much negativity about the UK economy – saying the tech sector which will define the country for the next two decades is thriving.
He said: “There is a sort of defeatism. Actually, when you look at it, there’s a lot going for it.”
The Chancellor insisted yesterday that “everything was on the table” as it emerged he was looking at an income tax and national insurance reduction for workers despite fears it could hike inflation.
He said: “I want to show people there’s a path to lower taxes. But we also want to be honest with people, this is not going to happen overnight. It requires enormous discipline year in, year out.”
He also said: “If you want to bring down personal taxes the only way to do that sustainably is to spend public money more efficiently. Rome wasn’t built in a day, these things take time.”
Ministers are under pressure to hike the pensions triple lock by average earnings of 8.5 per cent rather than 7.8 per cent if you strip out bonuses.
Mr Hunt could also face fury if he increases benefits in line with the usual September rate of inflation which was 6.7 per cent or the lower 4.6 per cent, offering a saving £2 billion.
Shadow Chancellor Rachel Reeves said: “If you pick and choose from year to year which inflation number is the cheapest thing to do, then what you see is the gradual erosion of people’s incomes.”
