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Only my growth plan will reverse Britain’s managed decline, says Liz Truss

The Telegraph logo The Telegraph 01/10/2022 Edward Malnick
Liz Truss has pledged to 'bring people with me on this journey' as she seeks to quell discontent over the UK economy - Eddie Mulholland for The Telegraph © Eddie Mulholland for The Telegraph Liz Truss has pledged to 'bring people with me on this journey' as she seeks to quell discontent over the UK economy - Eddie Mulholland for The Telegraph

Liz Truss has declared that only her plan to transform Britain into a low tax, high growth economy will reverse the “current trajectory of managed decline”.

In her first newspaper interview since becoming Prime Minister, Ms Truss said that “tough decisions” are needed to boost growth in order to increase wages, investment and employment.

She insisted that the public is more concerned with jobs and education than “what the polls were last year”, warning that voters “feel that there has been a failure to address some of the fundamental issues that affect our country”.

Unveiling new reforms to cut red tape for small businesses, the Prime Minister said that she wants to combat Britain’s “lack of dynamism”.

Seeking to quell discontent among Tory MPs over measures such as the abolition of the 45p tax rate, the Prime Minister said that she wants to “bring people with me on this journey”.

“Change is always something that people might find worrying,” she said. “But what I’m fundamentally saying is we do have to change, and the status quo isn’t an option.”

Ms Truss’s intervention in The Telegraph has come on the eve of the Conservative Party’s annual conference and after a string of backbenchers joined opposition parties in publicly criticising her plans.

Liz Truss arriving in Birmingham on Saturday for the Conservative Party conference - Geoff Pugh for The Telegraph © Provided by The Telegraph Liz Truss arriving in Birmingham on Saturday for the Conservative Party conference - Geoff Pugh for The Telegraph

On Sunday, Michael Gove, who backed Rishi Sunak in the Tory leadership contest, is expected to join those demanding a change in course.

Ms Truss said her planned combination of tax cuts and supply-side reforms is part of a “reset” to “get the economy going” and drive growth.

She said: “That’s what people need to look at, they need to look at the fundamentals of what we’re doing and the way the British economy does need to change.

“We cannot continue on the current trajectory of managed decline... We must take a new direction.”

Ms Truss disclosed that the first of her supply-side reforms, intended to dovetail with her tax cuts, will be lowering the threshold for firms to qualify as a “small business” and therefore benefit from an exemption to regulations.

She said: “One of the things we’ll be announcing is raising the definition of a small business, in terms of regulation, from 250 employees to 500 employees.”

The Prime Minister said the change would release an additional 40,000 firms from red tape and “make it easier for them to get on with their business”.

The Telegraph can also reveal that Ms Truss is planning to drive the creation of new “childminder agencies” under a French-style system to slash the cost of childcare.

The Prime Minister said: “If we had not acted and let this situation drift, we would have been seeing businesses go out of business, we would see inflation up to five points higher than it would have been. And we’re looking at a very severe economic slowdown.”

Liz Truss has criticised the 'declinist mentality' of her opponents - Eddie Mulholland for The Telegraph © Provided by The Telegraph Liz Truss has criticised the 'declinist mentality' of her opponents - Eddie Mulholland for The Telegraph

Ms Truss dismissed suggestions that she would sack Kwasi Kwarteng, saying: “The Chancellor is doing an excellent job and we are working very closely together. The decisions that have been taken are the right decisions that had to be taken in a hurry.”

Taking aim at her critics, including the Labour Party, the Prime Minister said: “I think it’s a declinist mentality, the idea that Britain’s best days are behind us and that all this is about is managing the distribution between people, rather than growing the size of the pie.

“I believe we can grow the size of the pie. But we need to take the tough decisions to do that.”

Meanwhile, writing in this newspaper, Jake Berry, the Tory chairman and former leader of the Northern Research Group of backbenchers, said that many commentators criticising the measures were people who previously spent time “bashing Brexit”.

He added that spending cuts are needed to help tackle the budget deficit.

Patrick Minford, a free market economist who has advised the Prime Minister, predicted growth of more than two per cent next year if Ms Truss pursues her policies.

On Sunday James Cartlidge, a former minister and an early backer of Mr Sunak’s leadership campaign, became the latest of a string of backbenchers to publicly criticise Ms Truss – as one of her senior ministers suggested the Government wanted to reduce spending on the “very large welfare state”.

Amid private dissent from some figures in government, one minister said: “The state of the party is the most parlous I can remember. I can’t believe I would say this but I don’t know if Liz will survive long-term. But I hope she can right the ship.”

Jeremy Hunt, who stood against Ms Truss in the Tory leadership race, has urged colleagues to give her “time”.

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