Rishi Sunak and Jeremy Hunt meeting today to ‘finalise’ Budget as Chancellor hits out at Liz Truss’ mistakes
RISHI Sunak and Jeremy Hunt will meet today to “start finalising” next Thursday's massive Autumn Statement.
The crunch meeting comes as the Chancellor blasted Liz Truss this morning over her disastrous mini budget.
The unfunded, tax-slashing bonanza sent the pound plummeting and mortgage rates soaring.
It’s partly responsible for the mess the British economy is in today.
Last night Mr Hunt's predecessor Kwasi Kwarteng dramatically broke his silence on the doomed budget.
He admitted on TalkTV there had been “no real tactical plan” and that he and Ms Truss should have adopted “a much more measured approach”.
Responding to the shock confession, Mr Hunt said: "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."
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On November 17 the Chancellor will unveil the government’s highly anticipated Autumn Statement.
The budget will lay out how the Treasury plans to fill an estimated £50bn black hole in public finances.
It will include a range of tax rises and spending cuts, which the Chancellor says are essential for balancing the books and clamping down on inflation.
This morning new stats revealed the UK economy shrank by 0.2 per cent in the last three months.
The Bank of England warned Britain is on the brink of a “very challenging” two-year recession.
Meanwhile, a new report from the Food and Drink Federation today showed that nearly half of food and drink manufacturers are cutting or pausing investment projects as they battle the "toughest trading conditions anyone can remember".
Food and drink businesses have seen costs increase by an average of 21 per cent over the last year, with a similar hike expected in 2023.
Mr Hunt responded to the GDP doom and gloom by saying it’s not “entirely unexpected news”.
But he added that the government must now “present a plan to the country to tackle the root cause of the issues we face”.
The Chancellor said next Thursday’s budget will be tailored to “protect the most vulnerable”.
It is widely expected that following weeks of heated debate in Westminster, the pension triple lock WILL stay in place.
In a potentially major win for hard-up Brits, it’s also likely that benefits WILL be uprated in line with inflation.
But Treasury sources say the Chancellor has had to “think the unthinkable” to balance the books, and a bundle of tax hikes are on the way.
For one, Mr Hunt is considering extending a freeze on income tax thresholds until 2028 – dragging millions more into a higher rate of tax.
The freeze was originally supposed to end in 2026.
By extending it, Brits who earn over £50,000 a year could end up paying £3,659 more in tax overall.
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The Chancellor is also mulling a shock tax raid on the rich that would see tens of thousands of extra high earners slapped with the top rate.
The £150,000 threshold at which the additional rate of income tax kicks in could be lowered and that rate of 45p in the pound even raised.
And millions of Brits could be hit with higher council tax bills as Mr Hunt weighs up scrapping a rule that forces local authorities to hold a referendum if they want to increase rates above 2.99 per cent.
In a move that will have major implications for businesses, the Chancellor is set to freeze the threshold companies must start paying VAT at £85,000 turnover, rather than raising it with inflation.
After today, Mr Hunt and the PM are expected to hold a final few set of meetings early next week before Thursday’s major announcement.
This morning the Chancellor said: "There isn't uncertainty about a basic choice we make as a country, which is whether we're going to pay our way.”
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"And if we don't give that certainty to the world, what we'll see is higher interest rates, higher inflation, more instability, and more worries for families and businesses.
"And that's why it's so important to show the world that we are a country that pays our way."