Responds in the House of Commons to the mini-budget
Fleur Anderson reacts to the government's 'fiscal event'. Picture: Twitter
Fleur Anderson, the MP for Putney has made a strongly worded statement in parliament condemning the government’s fiscal policy. She said the fiscal event or mini-budget will be terrifying for many already stretched households in her constituency.
She told the House of Commons, “The people of Putney, Roehampton and Southfields will see right through this budget for how little it will do for them. The only growth this ‘growth plan’ will deliver is a growth in inequality.”
She was speaking this Friday (23 September) following the announcement by the Chancellor of the scrapping of a planned increase in National Insurance, the abolition of the 45% tax rate band and the eventual reduction of the basic rate of income tax to 19% as well as reductions in Stamp Duty.
Afterwards she said, “Today's announcement is nothing short of is casino economics - gambling the mortgages and finances of every family in Putney and across the country to keep the Conservative party happy.
“Twelve years of Tory government have left us with lower growth, lower investment, lower productivity, and today - the lowest consumer confidence since records began. The only things that are going up are inflation, interest rates, bankers’ bonuses and levels of inequality.
“Putney, Roehampton and Southfields has one of the highest financial vulnerability levels in South West London, and the highest in the borough of Wandsworth and levels above both the London and UK average. Today's announcement will be terrifying for the already stretched and anxious households in our community.
“Costs of housing in London are also rising along with energy bills and food. But this mini-budget won’t help renters or mortgage payers. Increased inflation will increase mortgages and scrapping stamp duty during COVID led to selling off houses, a shortage of homes for rent and higher rents.”
The only growth the Chancellor’s ‘growth plan’ will deliver is a growth in inequality.— Fleur Anderson MP (@PutneyFleur) September 23, 2022
It lets oil and gas companies off the hook but will keep mortgages and rents high. #minibudget2022 @RachelReevesMP #Putney #Roehampton #Southfields pic.twitter.com/aIRJ61rvrW
The initial reaction of financial markets to what the government is calling a ‘fiscal event’ was initially very unfavourable with the value of sterling falling sharply and a rise in bond yields indicating further increases in interest rates are inevitable. Although the level of the pound has recovered it remains significantly down this year against the dollar and the Bank of England is widely expected to announce at least one rate increase before the end of the year.
Labour is proposing that oil and gas companies be made subject to a windfall tax to reduce the amount of money the government would need to borrow to put a cap on energy bills for businesses and households. It is also advocating a Green Prosperity Fund to boost growth by investment in sustainable energy sources.
The chancellor, Kwasi Kwarteng, has denied that the government is not committed to fiscal sustainability despite the huge increase in borrowing required in his plans. He argues that supply side reforms will cool inflation, as increased capacity brings down prices.
He said, “I’m confident that with our growth plan and the upcoming medium-term fiscal plan — with close co-operation with the Bank — our approach will work.”
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September 27, 2022