RISHI Sunak has said he is taking “five long-term decisions” in a bid to grow the economy and public finances.
The Prime Minister declined to give any specifics ahead of Wednesday’s Autumn Statement, although stressed the focus is “very much the supply side” of the economy in a sign that business tax cuts are more likely than personal ones.
Sunak (below) said he was able to move onto the “next phase” of the UK Government’s economic plan after inflation fell to 4.6% in October.
They would focus on reducing debt, cutting tax, building sustainable energy, backing British businesses and delivering world-class education.
He said: “We will do this in a serious, responsible way, based on fiscal rules to deliver sound money, and alongside the independent forecasts of the Office for Budget Responsibility.
“And we can’t do everything all at once. It will take discipline and we need to prioritise. But over time, we can and we will cut taxes.”
Although Sunak has met one of his previous five pledges to halve inflation in 2023, the rate of the Consumer Prices Index is still well above the Bank of England’s 2% target.
The PM repeatedly refused to “pre-empt” any decisions ahead of the financial statement, but said: “We will prioritise, we will be disciplined and our focus is very much the supply side and growing the economy.”
The prospect of tax giveaways comes ahead of a General Election expected next year and with the Tories seeking a boost to turn around opinion polls which have shown consistent Labour leads.
The Prime Minister contrasted his approach to the public finances with that of Labour and his predecessor Liz Truss (below).
He claimed Sir Keir Starmer and Rachel Reeves wanted to continue the “big government, big spending approach” of the pandemic, with up to £28 billion of borrowing a year for Labour’s green plans.
“This makes the same economic mistake as last year’s mini-budget, blowing tens of billions of pounds on unfunded spending is just as dangerous as blowing tens of billions of pounds on unfunded tax cuts.”
In a direct pitch to voters, Sunak said they could trust him on the economy as he brandished his background “working and investing in businesses large and small”.
“Whether you like me or not, I hope you know that when it comes to the economy, when it comes to your job, your family, your incomes, I’ll always take the right decisions for our country,” he said.
“So now you can trust me when I say that we can start to responsibly cut taxes.”
It comes after Deputy First Minister Shona Robison urged the Chancellor to avoid “ill-timed tax breaks” for wealthy people in the Autumn Statement.
She said: “The UK faces a combination of low growth and high interest rates. The Autumn Statement must learn the lessons from last year’s mini budget – it must not compound these problems with ill-timed tax breaks which would place even greater pressure on the public finances.
“The Scottish Government is using the levers available to us to support people through this difficult time.
“However, it is important that the UK Government uses its full range of reserved powers to address these challenges.”
She continued: “With many families continuing to struggle with the cost of living, the Chancellor must not use this statement to cut benefits.
“The Autumn Statement provides an important opportunity for the UK Government to support us to deliver the investment and services that Scotland needs, to demonstrate its commitment to net zero, and to help people and businesses with the economic challenges they face.”
A Treasury spokesman said: “Total departmental spending will be around £100 billion higher in four years’ time, even after taking account of inflation, while reducing national debt.
“The Autumn Statement will focus on how we get the economy growing healthily again by unlocking investment, getting people back into work and reforming our public services so we can deliver the growth our country needs.”
The Prime Minister also branded it a "national scandal" that around two million working-age people were not in employment.
“It’s not sustainable for the country, for taxpayers, it’s not fair,” he said, promising reform of the welfare system.
“We must do more to support those who can work to do so, and we will clamp down on welfare fraudsters because the system must be fair for taxpayers who fund it.”
