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Truss pitfalls lying an embattled prime min.

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Liz Truss is battling to save her premiership after just over a month in the job – what are the key hurdles she faces?

Halloween horror show?

Two things are going to happen on 31 October which could spook MPs.

Chancellor Jeremy Hunt will publish independent forecasts for the UK’s economic outlook, by the Office for Budget Responsibility (OBR).

And he will set out details of spending cuts and possible tax rises he will say are needed.

The chancellor has already ditched nearly all of his predecessor Kwasi Kwarteng’s tax-cutting mini budget, in the biggest economic U-turn in British history.

Many Conservative MPs have said they are waiting to see what Mr Hunt has to say, and how the markets react to it, before deciding whether to continue supporting Liz Truss.

The OBR forecasts are expected to be bleak. The Institute for Fiscal Studies suggests the UK economy is facing a £60bn “black hole”, while press reports suggest the OBR analysis will point to a larger gap of £72bn.

The £32bn package of tax cut reversals and rises announced by Mr Hunt this week will only take the chancellor part of the way to filling that, although there is much uncertainty around the numbers.

Spending cuts

Jeremy Hunt has already told government departments to come up with efficiency savings, and warned that public spending will not rise as quickly as some had expected.

In plain language, that means spending cuts.

Mr Hunt has said he is “not taking anything off the table”.

UK armed forces train Ukraine recruits
The UK is committed to military aid to Ukraine

Health, education and defence are the biggest spending departments, but cutting the budget of any of these would be politically toxic and hard to sell to Tory MPs.

Defence Secretary Ben Wallace – tipped by some as a potential replacement for Ms Truss – has said he intends to hold the PM to her promise to increase defence spending to 3% of GDP by 2030.

The welfare budget, which is the biggest source of cash spending, could end up taking the hit.

Pensions triple lock

The state pension – the biggest item in the welfare budget, according to the OBR – has long been seen as untouchable in British politics, with both Labour and the Conservatives promising to keep the triple lock guarantee. This is the policy which ensures the state pension goes up in line with inflation or average earnings or 2.5%, whichever is higher.

Under the guarantee, state pensioners would get a rise of about 10% in April 2023, which would take their weekly payment from £185.15 to just over £200.

Chancellor Jeremy Hunt indicated on Monday that the government was no longer committed to the triple lock, as he sought savings. This was echoed by the foreign secretary on Wednesday morning.

But Liz Truss told MPs she remains committed to the triple lock, at Prime Minister’s Questions at midday on Wednesday.

The PM’s official spokesman said Ms Truss had agreed to keep the triple lock after discussions with the chancellor, but declined to say whether she had overruled Mr Hunt.

Ms Truss believes pensioners are in a “unique position” because they are “unable to increase their earnings through work”, her spokesman said.

Uprating benefits

The chancellor could also attempt to break the previous government’s commitment to ensure that benefits increase in line with the rising cost of living.

But this would not go down well with many Tory MPs, including Commons leader Penny Mordaunt, another figure tipped as a replacement for Ms Truss, who have argued strongly against it.

Some benefits – such as the disability living allowance – do have to be uprated in line with inflation, by law. If the government wanted to uprate those benefits in line with earnings instead, it would need to pass a whole new law, which would face stiff resistance inside and outside Parliament.

There are different rules for other benefits, including universal credit, which can be increased through tweaks to existing law.

Fracking

One of Liz Truss’s first acts as prime minister was to announce an end to the ban on fracking, as part of a package of measures to boost domestic energy production.

But she has said it would only resume where there is local consent – and the government has yet to spell out how this will be sought.

A number Tory MPs have spoken out against the resumption of fracking, which was banned in 2019, reflecting constituents’ concerns about earth tremors.

However, given that overturning the ban does not require a new law, MPs may have to find other ways to get ministers to back down.

Labour is attempting to force a Commons vote on banning fracking and is urging Tory MPs to back it.

The opposition has already warned Tory MPs they will use the issue of fracking to campaign at the next election.

Cuadrilla fracking site
Ms Truss’s government has backed fracking as a way to boost the UK’s domestic gas supplies

Planning reform

The government still plans to push ahead with potentially controversial planning law reforms, which were a key part of Liz Truss’s plan to boost economic growth.

Ms Truss wants to deregulate planning, cutting environmental regulations and reducing the number of affordable homes in new developments. She also wants to scrap centrally-set housing targets. Some of the plans could be unveiled before 31 October, but they may prove difficult to get through.

Attempts by Boris Johnson’s government to fast track new developments had to be rethought after opposition from backbench Tory MPs.

Net zero review

In 2019, the UK made a legally binding commitment to reach the target of net zero carbon emissions by 2050. When he was prime minister, Mr Johnson was an enthusiastic supporter of net zero.

But at a time of historically high energy prices and soaring inflation, some Tory MPs have questioned the wisdom of spending money on hitting the target.

Their concerns have been taken on board by Ms Truss, who has commissioned an independent review into the delivery of net zero.

Led by former energy minister Chris Skidmore, the review with a focus on “ensuring the UK’s fight against climate change maximises economic growth, while increasing energy security and affordability for consumers and businesses”.

He will report to the government with a set of recommendations by the end of this year.

Reports /TrainViral/

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Politics

Gething downfall delivers Starmer 1st headache

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Just when you’d have been forgiven for thinking politics might quieten down a bit…

The Welsh Labour government was for so long a case study in how the party could operate in power during its long years of opposition at Westminster.

And yet here we are less than a fortnight into a UK Labour government, and the Welsh Labour government is imploding.

So much for all that talk about bringing stability back to politics.

Last week Vaughan Gething was sharing smiles here not just with the new prime minister but the King too.

Now, he’s a goner, delivering Sir Keir Starmer a headache rather than a handshake.

When I was here in March covering Mr Gething’s victory, the seeds of his political demise were germinating before our eyes.

The donations row had already sprouted and his defeated opponent, Jeremy Miles, legged it from the venue without so much as any warm words about the victor on camera.

It was another sign of the cultivating anger, the political knotweed that would soon flourish and ensnare Vaughan Gething.

Along came the row about alleged leaking, a sacking, a confidence vote — and a first minister whose tenure up until today at least amounts to 2.4 times that of Liz Truss. Ouch.

Westminster has generated its fair share of turbulence in the last decade.

But it is far from unique as a source of turbulence in UK politics.

In February, Michelle O’Neill became first minister of Northern Ireland with Emma Little-Pengelly her deputy, after a long period without devolved government at Stormont.

In March, we had a new first minister of Wales, when Mark Drakeford stood down and Vaughan Gething took the job.

In April we had the resignation of the first minister of Scotland Humza Yousaf.

He was replaced the following month by John Swinney. June was the quiet month then. Just the small matter of a general election campaign.

And here we are in July, and Mr Gething is resigning.

So will begin another leadership race, a new government in Wales, a new first minister and a new team of senior Welsh ministers.

There will also be more arguments about Welsh Labour – its direction, its priorities, its capacity to govern effectively and its relationship with the UK party.

If you’re watching this in Downing Street, it’s the last thing you need.

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Shoplifting crackdown expected to be unveiled

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A crackdown on shoplifting is expected to be announced in the King’s Speech on Wednesday.

The government is due to unveil a new crime bill to target people who steal goods worth less than £200.

The policy would be a reversal of 2014 legislation that meant “low-value” thefts worth under £200 were subject to less serious punishment.

The government is also expected to introduce a specific offence of assaulting a shop worker to its legislative agenda.

It will not be clear until legislation passes through Parliament what the punishments for any new or strengthened offences would be.

Data from the Office for National Statistics shows that last year was the worst on record for shoplifting in England and Wales.

Police recorded over 430,000 offences in those nations in 2023 – though retailers say underreporting means these figures are likely to represent only a fraction of the true number of incidents.

Michelle Whitehead, who works at a convenience store in Wolverhampton, said her shop had been “hit every day” by thieves.

People were stealing “absolutely anything” including “tins of spam, tins of corned beef, all the fresh meat”, Ms Whitehead told BBC Radio 4’s World at One programme.

“They’re just coming in, getting their whole arm and sweeping the lot off the shelves,” she said. “The shelves were always empty.”

She said she believed “organised” criminal gangs, rather than individuals struggling with the cost of living, were behind the thefts in her shop.

The crackdown on “low-value” shoplifting “will help a lot of little shops,” Ms Whitehead said.

While retailers and shop workers have welcomed the anticipated proposals, a civil liberties group has raised concerns about criminalising people struggling to make ends meet and overburdening the prison system.

The new legal measures are expected to be announced as part of the King’s Speech on Wednesday, a key piece of the State Opening of Parliament that allows the government to outline its priorities over the coming months.

Before the general election, the Labour Party pledged to reverse what it described as the “shoplifter’s charter” – a piece of 2014 legislation that reduced the criminal punishment for “low-value shoplifting”.

Tom Holder, spokesperson for the British Retail Consortium (BRC), told BBC News the impact of the 2014 legislation has been to “deprioritise it in the eyes of police”.

“I think police would be less likely to turn up to what they see as low-level theft,” he said.

Shoplifting cost retailers £1.8 billion in the last year, which could impact prices, according to the BRC.

“Shoplifting harms everyone in that sense – those costs eventually get made up somewhere, whether it’s prices going up or other prices that can’t come down,” Mr Holder said.

Co-op campaigns and public affairs director Paul Gerrard said the supermarket chain had also recorded rising theft and violence against shop workers.

“There’s always been people who will steal to make ends meet. That’s not what is behind the rise we’ve seen,” he told BBC Radio 4’s Today programme on Tuesday. “What’s behind that rise is individuals and gangs targeting large volumes of stock in stores for resale in illicit venues like pubs, clubs, markets, and out the back of cars.”

But Jodie Beck, policy and campaigns officer at civil liberties organisation Liberty, had concerns about the expected proposals, saying there is “already a wide range of powers” the police can use to tackle shoplifting and anti-social behaviour levelled at retail staff.

Ms Beck said the “£200 threshold” would not just target criminal gangs but also “people who are pushed into the desperate situation of not paying for things” because they cannot afford to make ends meet.

She urged the government to avoid focusing on “criminal justice and policing solutions instead of doing the thoughtful work of looking at the root causes of crime, which we believe are related to poverty and inequality”.

Ms Beck also argued the additional legislation could serve to worsen the UK’s “enormous court backlog” and its “bursting prison system”.

Last week, Justice Secretary Shabana Mahmood announced plans to release thousands of prisoners early to ease overcrowding in the country’s prisons.

A spokesperson for Downing Street said the government would not comment on the King’s Speech until it has been delivered by the monarch.

The National Police Chiefs’ Council has been approached for comment.

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Government launches ‘root and branch’ review

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Defence Secretary John Healey hailed the government’s defence review as the “first of its kind” and said it will “take a fresh look at the challenges we face”.

Mr Healey noted the “increasing instability and uncertainty” around the world, including the conflict in the Middle East and war in Ukraine, and said “threats are growing”.

The strategic defence review will consider the current state of the armed forces, the threats the UK faces and the capabilities needed to address them.

Sir Keir Starmer has previously said the review will set out a “roadmap” to the goal of spending 2.5% of national income on defence – a target he has made a “cast iron” commitment to but is yet to put a timeline on.

On Monday, the prime minister said the “root and branch review” of the armed forces would help prepare the UK for “a more dangerous and volatile world”.

The review will invite submissions from the military, veterans, MPs, the defence industry, the public, academics and the UK’s allies until the end of September and aims to deliver its findings in the first half of 2025.

“I promised the British people I would deliver the change needed to take our country forward, and I promised action not words,” Sir Keir said.

“That’s why one of my first acts since taking office is to launch our strategic defence review.

“We will make sure our hollowed out armed forces are bolstered and respected, that defence spending is responsibly increased, and that our country has the capabilities needed to ensure the UK’s resilience for the long term.”

The review will be overseen by Defence Secretary John Healey and headed by former Nato Secretary General Lord Robertson along with former US presidential advisor Fiona Hill and former Joint Force Commander Gen Sir Richard Barrons.

The group will have their work cut out.

The global security threats facing the UK and its Western allies are more serious and more complex than at any time since the end of the Cold War in 1990.

They also coincide with what many commentators have said is a catastrophic running down of the UK’s armed forces to the point where the country is arguably no longer considered to be a Tier One military force.

In terms of the number of troops in its regular forces, the British Army is now at its smallest size since the time of the Napoleonic Wars two centuries ago.

Recruitment is failing to match retention, with many soldiers and officers complaining about neglected and substandard accommodation.

The Royal Navy, which has spent vast sums on its two centrepiece aircraft carriers, is in need of many more surface ships to fulfil its tasks around the globe.

Its ageing fleet of nuclear-armed Vanguard submarines, the cornerstone of the UK’s strategic defence and known as the Continuous At Sea Deterrent (CASD), is overdue for replacement by four Dreadnought class submarines and costs are mounting.

Commenting on the review, Mr Healey said: “Hollowed-out armed forces, procurement waste and neglected morale cannot continue.”

Too many UK commitments?

The defence and security threats facing the UK, Nato and its allies further afield are multiple.

They include a war raging on Europe’s eastern flank in Ukraine against Russia’s full-scale invasion. The UK, along with the EU and Nato, has opted to help defend Ukraine with multi-billion pound packages of weapons and aid, stopping short of committing combat troops.

The policy behind this is not entirely altruistic. European governments, especially those closest to Russia like Poland and the Baltic states, fear that if President Putin wins the war in Ukraine it will not be long before he rebuilds his army and invades them next.

Some of those countries are already busy beefing up their own defence spending closer to 3% or even 4% of GDP.

The challenge for Nato has been how to provide Ukraine with as much weaponry as it can, without provoking Russia into retaliating against a Nato state and risk triggering a third world war.

The Royal Navy has been in action recently in the Red Sea, where it has been operating alongside the US Navy in fending off attacks on shipping by the Iranian-backed Houthi rebels in Yemen.

But the UK has also made naval commitments further afield in the South China Sea with the Aukus pact, comprising of Australia, UK and the US, aimed at containing Chinese expansion in the region.

Critics have questioned whether a financially-constrained UK can afford to make commitments like this on the other side of the world.

Closer to home in Europe, there is a growing threat from so-called “hybrid warfare” attacks, suspected of coming from Russia.

These are anonymous, unattributable attacks on undersea pipelines and telecoms cables on which Western nations depend.

As tensions increase with Moscow there are fears such actions will only increase and the UK cannot possibly hope to guard all of its coastline all of the time.

But while those nervous Nato partners living close to Russia’s borders are busy beefing up their defence spending closer to 3 or even 4% of GDP, the UK has so far declined to put a timetable on when it will raise its own defence spending to just 2.5%.

Opposition figures have criticised the government for refusing to say when defence spending will be increased.

Before his election defeat, former prime minister Rishi Sunak committed to reaching 2.5% by 2030.

Shadow defence secretary James Cartlidge previously said: “In a world that is more volatile and dangerous than at any time since the Cold War, Keir Starmer’s Labour government had a clear choice to match the Conservatives’ fully funded pledge to spend 2.5% of GDP on defence by 2030.

“By failing to do so, they’ve created huge uncertainty for our armed forces, at the worst possible time.”

Reports /Trainviral/

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