Nadhim Zahawi
(Picture: PA Wire)Chancellor Nadhim Zahawi on Monday pledged to cut 20 per cent from every government department as the Tory leadership race heats up.
Mr Zahawi is one of eleven MPs vying to replace Boris Johnson as party leader and prime minister.
He said slashing jobs and spending in Whitehall would give him “headroom” to be able to deliver tax cuts and bring down spirilling inflation.
He told Sky News: “I think it’s only right that across government we do this exercise. It’s an important exercise. It’s only right that we exercise fiscal discipline when it comes to public sector pay. Why? Because if we do that, we can bear down on inflation, that in itself brings down inflation.”
Asked whether Mr Zahawi’s pledge to cut 20 per cent from the budgets of Government departments would mean civil servants losing jobs, former Cabinet Secretary Lord Butler said: “I expect it would”.
The former senior mandarin – who served Margaret Thatcher, John Major and Tony Blair – added to it was not impossible but that it “ought to be done with respect and care for the people whom you are employing”.
Mr Zahawi was promoted from education secretary last week when Rishi Sunak, who is also a leadership candidate, resigned.
He claimed that while leading the Department for Education he was able to cut spending by almost a fifth.
“It was a tough exercise,” he said. “We looked at how can we continue to deliver our pledges in the manifesto and skill schools families...
“But I managed it. I managed to get close to that number. I want all of my colleagues as chancellor to do the same thing.”
It comes as multimillionaire Mr Zahawi was under scrutiny over his own tax affairs. Experts from the Inland Revenue are reportedly investigating his finances in a probe which was initially launched by the National Crime Agency (NCA) in 2020.
“I was clearly being smeared,” he said. “I was being told that he Serious Fraud Office that the National Crime Agency that HMRC are looking into me. I'm not aware of this. I've always declared my taxes. I paid my taxes in the UK.
“I will answer any questions HMRC has of me, but I will go further. I'm going to make a commitment today that if I am Prime Minister, I think the right thing to do is to publish my accounts annually.”
Fellow Tory leadership candidates Tom Tugendhat and Liz Truss also pledged to cut taxes on Monday.
Mr Tugendhat said he would "lower taxes across every aspect of society".
The Foreign Affairs Committee chair was one of a few Conservative MPs to vote against the national insurance hike earlier this year.
"I certainly think that we should be looking to lower taxes across every aspect of society," he told BBC Radio 4's Today programme.
He argued for "taking the brakes off" the economy as it is the "private sector that generates growth", but did not explain how he would finance the tax cuts.
Mr Tugendhat blamed quantitative easing for inflation, saying it has been "pumping up the economy and inflating a sugar high of growth".
He added that Britain should “take advantage” of Brexit and tear up EU regulations to do new trade deals.
The former Remainer said: “There are any number of different policies and regulations that are, at the moment, or at least up until recently, fixed in Brussels that can now be fixed in Westminster, that can now be changed, and we need to take advantage of that.
“Frankly, we just haven’t yet done it.
“Boris has quite rightly got Brexit done. What we now need to do is deliver the benefits.”
