“U-turn if you want to. The lady’s not for turning,” Liz Truss ally Simon Clarke said of the soon-to-be prime minister during the Tory leadership campaign. But it turns out she really is.
Here are the five biggest, screechiest, U-turns Truss has made so far.
1. Windfall taxes
During the leadership campaign Truss was unequivocal. “I absolutely don’t support a windfall tax,” she said. “I don’t think profit is a dirty word, and the fact it’s become a dirty word in our society is a massive problem.”
Speaking during her first outing at PMQs, she repeated her position. Windfall taxes were “wrong” as they put companies off from investing in the UK.
Truss has now imposed a windfall tax on green energy firms. Renewables and nuclear companies are to have their profits capped to stop them raking in huge profits due to record gas prices.
2. Who runs the Treasury
One of Truss’ government’s first acts was to sack Tom Scholar, the experienced permanent secretary at the Treasury. It was a blunt move showcasing a desire to shake-up what the PM had branded “Treasury orthodoxy”. It was greeted by critics as a “sure route to bad decision-making”.
In his place, Truss planned to appoint Antonia Romeo, the top civil servant at the Ministry of Justice. She had never worked in the Treasury.
But instead, the job has gone to James Bowler. He has been the permanent secretary at the Department for International Trade since August 2021. He is a veteran of the Treasury, having held top jobs in the department for many years. Bowler also worked as a senior adviser to both David Cameron and Gordon Brown.
3. The date of the ‘medium term fiscal plan’
Kwasi Kwarteng was going to announce his medium term fiscal plan from November 23 — two months after his mini-Budget. The statement to parliament will explain how he proposes to meet his goal of reducing debt.
Tory MPs worried that one aspect of the market freakout gripping the country was the delay. But at the start of October, the chancellor insisted: “It’s going to be November 23.”
On October 10 he changed his mind. It is now due on October 31 — Halloween. Asked by the BBC on Wednesday morning if that new date was set in stone, business secretary Jacob Rees-Mogg did not say yes.
4. 45p tax rate
In one of the screechiest U-turns of all time, Truss and her chancellor ditched their headline grabbing plan to abolish to 45p top rate of tax. The announcement had been made with a flourish during the mini-Budget on September 23. Markets reacted with confusion and horror. As did a sizeable chuck of the Conservative Party.
The move came during a Tory conference dominated by in-fighting. Truss’ decision to dump the plan — on the eve of Kwarteng’s speech — was so last minute that TV interviews were broadcast the next day in which she was still defending the idea.
5. Paying people outside London less
Perhaps the signs were there. During the leadership contest Truss floated the idea paying workers living in cheaper areas of the country less than their counterparts in places like London and the South East. Tory MPs were livid, with one describing it as “austerity on steroids”.
Truss complained there had been a “wilful misrepresentation” of the plan by the media. There had not. Quickly U-turning on the proposal, Truss said it showed she was “honest and decisive”.
More to come?
Truss remains under pressure from her own MPs to ditch further parts of the mini-Budget, amid warnings she will have to impose £60bn of spending cuts if the government sticks to its current tax cutting plans. Once again, asked this morning if he could rule out more U-turns, Rees-Mogg did not say yes.
Tory MPs have also been campaigning hard to ensure the prime minister increases benefits in line with inflation, with one former chief whip warning the chancellor yesterday not to balance the books “on the back of the poorest people”.
