On 6 September, Liz Truss assumed the office of prime minister after receiving support from 57.4% of Conservative Party members who voted in the leadership election. Those members consist of a mere 0.4% of the UK population.
Now, Truss’s laughing chancellor Kwasi Kwarteng has unveiled a mini-budget which can only be described as an all-out declaration of war on workers, particularly the poor.
Meanwhile, the Bank of England has made it clear that the UK is now in recession.
Rich get richer
The winners from the Tory mini-budget are the well-off – those earning more than £150k a year. Indeed, it’s understood that someone earning more than £1m a year will be the beneficiary of tax cuts of more than £55k a year.
Moreover, the so-called tax cuts for the less well-off is an illusion, explains Howard Beckett of Unite the Union:
The government put your income taxes up – not down.
They’re freezing your personal tax allowance until 2026.
When you add inflation it means a tax of £1,500 in total for every minimum wage worker in the UK from 2022-6.
The drop to 19p will barely make a dent in that.
— Howard Beckett (@BeckettUnite) September 25, 2022
Other budgetary measures include removing the cap on how much bankers get in bonuses.
The Resolution Foundation posted a graph that demonstrates how the rich will disproportionately benefit from the budget:
Almost two-thirds of the personal tax cut gains go to the richest fifth of households, who will be better-off on average by £3,090 next year. Strikingly, almost half will go to the richest 5 per cent, while the poorest half of households will gain just £230 on average next year. pic.twitter.com/ruViGGyrBn
— Resolution Foundation (@resfoundation) September 23, 2022
“Brutal” measures
Kwarteng is also targeting Universal Credit recipients by threatening to pause or reduce their benefits.
Independent SAGE member and former WHO director Anthony Costello tweeted that these measures are “brutal”:
After announcing he’ll remove restrictions on banker’s pay, the Chancellor says that 120,000 more people on Universal Credit must "take active steps to seek more and better-paid work, or face having their benefits reduced". Brutal, structural violence against women +children. pic.twitter.com/4Tjy3FRFJ8
— Anthony Costello (@globalhlthtwit) September 23, 2022
Meanwhile, Greater Manchester mayor Andy Burnham called the measures in the budget “immoral”. He also posted a graph that sums up the impact Kwarteng’s mini-budget will have:
I’m trying to think of the word that best describes today’s Budget and only one does it: immoral. pic.twitter.com/UEpPQWEqy7
— Andy Burnham (@AndyBurnhamGM) September 23, 2022
The energy bills rip-off
Then there’s the energy bill crisis, which will leave poor people that much more worse off. Beckett points out how these bills are “a complete rip off”:
By October your energy bills will have gone up 85% this year alone, 140% from March ‘21.
Meanwhile wholesale gas is 40% cheaper than March, 54% cheaper than August.
It’s a complete rip off.
— Howard Beckett (@BeckettUnite) September 16, 2022
As The Canary has previously pointed out, instead of a windfall tax on the energy companies, those companies will receive billions of pounds. And the cost will be met by tax payers.
Failing economy
In the wake of Kwarteng’s budget and the rise in the cost of borrowing, the pound tumbled against the US dollar to its lowest level since 1985. It will likely mean prices of imports will rocket, leading to higher prices generally, as well as higher inflation. And it’s predicted that interest rates could rise to 5% in 2023, affecting mortgages and consumer credit to add to the squeeze.
Regarding Truss’s economic strategy, this is supposedly based on the myth of trickle down economics. One Twitter user neatly summed this up:
I saw a homeless guy and I felt bad for him.
So I did what I think any of us would do – drove to a nearby affluent area, found the biggest, nicest house and put a tenner through their letter box.
You mark my words, before long that money will trickle down to the homeless guy.
— James '2 Fringe Shows' Cook (@jamesecook) September 24, 2022
As for exports, another Twitter user pointed out that Brexit is costing the UK £100bn a year in lost output, according to the Financial Times:
So #Brexit is costing the UK £100 billion a year in lost output according to government's own figures.
That's 11 years worth of EU membership each single year but with none of the benefits.
Jaw dropping figure. pic.twitter.com/np9gkvjHPb
— Britain People (@Britain_People) September 18, 2022
Also, the number of UK businesses exporting goods to the EU fell 33%, from 27,321 businesses in 2020 to 18,357 in 2021, according to data from HMRC.
Other anti-worker measures
Previously, The Canary warned of other measures planned for by Truss. For example, we published details of how Truss intends to destroy hard-won employment rights and environmental protections.
And earlier in 2022, Kwarteng changed the law to make strike-breaking legal:
https://twitter.com/KwasiKwarteng/status/1550081224890351617?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1550081224890351617%7Ctwgr%5E8a7a4f14a4706ff4485d222076e2130fcf1733e3%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Fwww.thecanary.co%2Fuk%2Fanalysis%2F2022%2F09%2F11%2Fthe-anti-rights-bill-is-shelved-but-liz-trusss-class-war-continues-unabated%2F
Class war moves up a level
The Canary has been comprehensively covering the Tories’ class war in its many manifestations. Now, Kwarteng’s mini-budget takes that war to another level, so further widening the gap between rich and poor.
The Tories’ brutal measures will likely cause more people to become destitute, starve, or die. Moreover, inflation will ensure interest rates continue to rise, affecting those on mortgages or in debt. Overall, except for the very wealthy, these latest measures will negatively affect millions of people.
As for Truss, she is backed by the secretive European Research Group. This is the same group that’s responsible for the hard-line approach on Brexit which the Johnson government adopted. So expect more hard-line measures in the coming months.
It’s time we fought back, as Beckett says:
£50 billion budget giveaway for the richest.
£130 billion bung to energy corp moguls.
£500 rise in your gas bill starting next Friday.
This is class war, it’s time we fought back.
— Howard Beckett (@BeckettUnite) September 23, 2022
Just how much more can people take?
Featured image via YouTube
