Wokingham politicians slam government economic plans
Local politicians have lambasted the government for being ‘out of touch’ and ‘economically illiterate’ as the value of the pound fell to a record low yesterday.
Boosted by new Chancellor Kwasi Kwarteng’s mini-tax cut budget announced last week, the pound fell to 1.0327 against the US dollar.
Wokingham Liberal Democrat parliamentary candidate Clive Jones called the announcement a “recipe for disaster” that will leave people “suffering” from soaring prices.
“With the worst inflation in decades, rising interest rates and an economy heading into a recession, the Conservatives’ claim to be the party of business now looks like a bad joke,” Cllr Jones added.
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The cut came after Mr Kwarteng announced his intention to boost growth by cutting income tax and stamp duties, while increasing borrowing, at a time of double-digit inflation and refusing to provide economic forecasts from the Office for Budget Responsibility (OBR).
Wokingham MP John Redwood, a supporter of new Prime Minister Liz Truss during the recent leadership debate, tweeted this ‘synthetic anger’ over the lack of ‘dumb’ OBR forecasts as they are ‘wildly inaccurate’ “.
Wokingham’s Labor campaign co-ordinator, Councilor Andy Croy, has accused the Tories of launching a ‘special financial operation’ on the UK economy which would have ‘devastating consequences’ for the local population.
“The Conservatives have cut taxes on the wealthy and are borrowing money to pay. We will all have to repay the loans necessary to pay for these tax cuts. Not only is it terribly unfair, but it is also economically illiterate,” he added.
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The pound rebounded to around $1.08 at 7am this morning, but economists have warned it could still fall to parity with the dollar this year for the first time, with many predicting that the Bank of England (BoE) will have to raise interest rates to stem the flow.
In his blog, Mr Redwood warned the BoE to “be careful” as the government “provides massive help” through energy support measures and tax cuts.
Cllr Croy called the government ‘economically illiterate’ and ‘lost control’ after some mortgage lenders withdrew deals in response to market turmoil.
He accused the Tories of allowing energy prices to double while companies sit on ‘mountains of cash’ instead of bringing in a windfall tax.
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The Liberal Democrats are also calling for a new windfall tax on oil and gas companies, as well as an immediate freeze on domestic energy prices and the removal of banker bonus increases.
Mr Redwood said he would like ‘to see borrowing go down’ and the budget to be balanced, but there is ‘no option for that to happen easily’.
The MP for Wokingham suggested the government could save money by seeing ‘more people get jobs’ and ‘get a better grip on the number of illegal and low-paid economic migrants’.
Mr Redwood did not respond when approached about whether leaving the world’s largest economy was ideal if the government needed more growth, whether to cut taxes and increase borrowing at a time of inflation is already high is a good idea or whether the Conservatives should go back. the electorate to seek a mandate for such a drastic change in economic policy.