Conservative leadership candidate Rishi Sunak has accused former Cabinet colleagues of a having a “rose tinted” view of the last days of Boris Johnson’s government as he defended his plans to slash income tax.
The former Chancellor is battling to regain ground on rival Liz Truss as the pair enter a crucial week in the leadership contest. The 160,000 Conservative members will receive their ballot papers this week, with some able to submit their votes from Monday, as the pair prepare for their second hustings event, in Exeter on Monday night.
On Monday morning, Chancellor Nadhim Zahawi became the latest senior minister to endorse Mr Truss following Defence Secretary Ben Wallace last week and former Northern Ireland Secretary Brandon Lewis on Sunday.
With early polls of Conservative members showing Ms Truss comfortably ahead, some commentators have blamed Mr Sunak’s decision to quit Mr Johnson’s cabinet amid concerns over “a very serious ethical issue” and a disagreement on economic policy, which triggered the Prime Minister’s downfall last month.
But speaking to BBC Radio 4’s Today programme, Mr Sunak said: “I do think there is a risk that people are looking at the last few months of the government with slightly rose-tinted glasses about what it was really like, because it wasn’t working as it should and crucially, the government found itself on the wrong side of a very serious ethical issue.
“For me also going down the wrong economic path. That’s why in the end, more than 60 Members of Parliament at last count, I think, resigned from the government, of which I, after a lot of deliberation and months of standing by the PM, was one of them.
“If people want to have rose-tinted spectacles about what was going on in government, that’s up to them, but they have to recognise it.”
In a last-ditch effort to win over the party faithful before they start voting, Mr Sunak attempted to shake off his image as the tax-hiking former chancellor by promising the “biggest income tax cut since Margaret Thatcher’s government”.
He vowed to slash the basic rate from 20 per cent to 16 per cent within seven years if he becomes prime minister, in a move immediately branded as a “flip-flop” by allies of Ms Truss after weeks of labelling her plans for sweeping tax cuts as “comforting fairy tales”.
Mr Sunak’s plan builds on his previously announced 1p cut to income tax in April 2024, with the additional 3p to be slashed dependent on economic growth to fund it, a move which could costs as much as £19billion.
The former Chancellor denied he was performing another U-turn on tax - less than a week after he announced he would introduce a temporary cut to VAT on energy bills to help ease the cost of living crisis, a move his critics said he had resisted while he was running the Treasury.
Asked whether the tax cutting plan was an attempt to claw back ground on Ms Truss, he told the BBC: “No, definitely not. This is entirely consistent with what I’ve been saying for a long time.
“And that’s why as Chancellor I set out a plan to cut income tax in this Parliament already. The first penny off the basic rate in almost 15 years was something I announced as Chancellor. But what I’m talking about today is my desire to go further than that over time, and people should know that that’s where I want to take the economy.”
He also rejected a swipe from Mr Zahawi, who wrote in the Telegraph, that Ms Truss would overturn a “stale economic orthodoxy” in the Treasury and “run our economy in a Conservative way.
“I was on the side of rejecting it [the orthodoxy] in the pandemic,” he said. “What people saw from me was I ripped up the rulebook, I did something that never been done before in this country and created the furlough scheme. That was completely no orthodoxy about that. It worked. It saved millions of people's jobs, and I'm proud that I did it.
“And actually, when it comes to business taxation, as you mentioned, it's my opponent in this contest, who wants to stick with the failed orthodoxy of having these ultra low corporation tax rates.”
In a further swipe at his opponent, who has pledged to delay a steep rise in Corporation Tax from next year if she wins the race to Downing Street as well as scrapping the rise in National Insurance, Mr Sunak said: “I don't think embarking on a spree of excessive borrowing at a time when inflation and interest rates are already on the rise would be wise. I think everyone gets it that is a point of differentiation between us but we need to also look beyond that. And that's why I want to give people a sense of where I want to take the economy once we grip inflation.”
But Chief Secretary to the Treasury Simon Clarke, who is backing Ms Truss, rounded on Mr Sunak’s tax plans saying: "Liz will cut taxes in seven weeks, not seven years."
A Truss campaign source added: "It’s only a shame he didn’t do this as Chancellor when he repeatedly raised taxes.
"He has also made it conditional on getting growth first - knowing full well that his corporation tax rises are contractionary.
"The public and Conservative Party members can see through these flip flops and U-turns."
