Liz Truss admits budget mistakes and apologises after Jeremy Hunt announces mini-budget U-turn

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By Euronews
Britain's Prime Minister Liz Truss holds a press conference in the Downing Street Briefing Room in central London, Friday Oct. 14, 2022.
Britain's Prime Minister Liz Truss holds a press conference in the Downing Street Briefing Room in central London, Friday Oct. 14, 2022.   -   Copyright  Credit: AP

The UK's prime minister apologised as she admitted her government had made mistakes over the mini-budget last month that spooked the financial markets.

Liz Truss was speaking after new finance minister Jeremy Hunt ripped up her economic plans.

He dramatically reversed most of the tax cuts and spending proposals that his predecessor Kwasi Kwarteng announced less than a month ago. 

"Now I recognise we have made mistakes," Truss, who has only been in office a little more than a month, told the BBC. "I'm sorry for those mistakes, but I fixed the mistakes. I've appointed a new chancellor. We have restored economic stability and fiscal discipline."

Hunt's swift U-turn on Truss' mini-budget has undermined the PM's authority and some have questioned how much longer she can remain in office.

Responding to questions about her future, Truss said she wanted to focus on "delivering for the British public".

"We are in difficult economic times, we are in difficult international times with the war being perpetrated in Ukraine," she added. "And now is the time to focus on delivering."

Hunt said almost all the previous tax measures are to be reversed in a move aimed at raising £32 billion (€37 billion) a year. 

A planned 1% cut in the basic rate of income tax for next April is being cancelled.

He also said the massive energy support package will not be continued beyond next April. Instead, a Treasury-led review into how best to support homes and businesses with energy bills will be launched.

The former health and foreign affairs minister has been racing to overhaul the government's financial plans since he replaced Kwarteng, who was sacked on Friday

Kwarteng's unfunded tax cuts announced on 23 September sent the pound tumbling, borrowing costs soaring, and sparked a collapse in support for the ruling party.

On Sunday, Hunt and Truss held a crisis meeting at her country residence to prepare a new budget plan. Defending the government's new direction, he acknowledged his predecessor's mistakes and warned of "difficult decisions" to come.

Opinion polling shows Truss' Conservatives trailing the UK's main opposition party, Labour.

Its leader, Sir Keir Starmer, said Truss was "clinging onto power" and that her government "no longer have a mandate from the British people".