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Liz Truss’s low tax plan was wrecked by slow civil service, says MP trying to rescue her agenda

The i 14/03/2023 Serina Sandhu
Ranil Jayawardena was environment secretary during Liz Truss's time as prime minister (Photo: Chris J Ratcliffe/Getty) © Provided by The i Ranil Jayawardena was environment secretary during Liz Truss's time as prime minister (Photo: Chris J Ratcliffe/Getty)

Liz Truss is the doctor who got the diagnosis of Britain’s economic woes right, but her “prescription ended up being not quite what we needed.”

That’s the claim of Ranil Jayawardena, Truss’s former environment secretary who is fronting the effort to salvage her low tax agenda from the ashes.

He extends the analogy when asked why he believed her 49-day stint in Number 10 ended as it did in an interview with i. “I think the support for the doctor actually could have been better.”

“The problem was the machinery of Government,” he says. It’s not that civil servants set out to sabotage her regime – the system just didn’t respond fast enough to the demands put on it. “I just think things need to be far more agile than they were in the past.”

Jayawardena fronts the newly formed Conservative Growth Group which he claims has 55 MPs supporters, a number large enough to cause Rishi Sunak problems, although he insists he wants to be helpful.

On his account it was an unfortunate mixture of global economic factors and inadequate support that crashed the Truss project – and very nearly the British economy – rather than its objectives.

It’s a bold endeavour and one likely to raise eyebrows – if not the blood pressure – of those paying larger mortgages as a consequence of last autumn’s crisis. Most experts believe that the loss of confidence in the UK’s ability to pay its debts was induced by Kwasi Kwarteng’s budget with its huge tax giveaways.

With an almost permanent grin, the 36-year-old MP for North East Hampshire is the amiable face of the Truss agenda. He appears to be well aware of the need for a tactical retreat.

He acknowledges that scrapping the top rate of income tax was a mistake, for example, and says the group is not – currently – seeking any changes to headline rates.

But in meetings with Chancellor Jeremy Hunt ahead of Wednesday’s budget the Trussite group has been pushing for tax breaks for the relatively well-off. It does so on the grounds it would help the NHS.

He lists a number of what he calls ‘doctors’ taxes’ – like the cap on how much the state pays into private pensions and the removal of the personal allowance from those earning over £100,000 – that the group want removed on the grounds that it would help keep doctors in the NHS and so reduce backlogs.

Other asks include rolling back anti-avoidance measures known as IR35 introduced to stop so-called ‘disguised employment’ which critics say place unfair restrictions on contractors and freelancers as well as raising the VAT threshold from £80,000 to £250,000.

Jayawardena, who was accompanied by former levelling-up secretary Simon Clarke and Sir John Redwood when he met Hunt, says he believes the Chancellor “is someone who believes in growth.”

Unusually for a Tory MP these days he is prepared to defend austerity. The term was a mistake, he says, but not the effort to tighten the focus of state. He worries that a ‘hangover’ from Covid is a mistaken belief that the state can and should always protect people. He thinks cutting VAT on fuel bills may be a better way of dealing with high energy costs than continuing with the attempt to cap average bills.

As environment secretary Jayawardena found himself at the centre of a storm of protests from green groups outraged at suggestions that environmental protections were going to be rolled back in the name of economic growth.

He defends himself – as well as his Tory predecessors – from claims they didn’t do enough to stop the discharge of raw sewage into rivers.

“There is this view that this is a brand new problem that has suddenly come about because of nasty Conservatives when actually this has been going on since Victorian times when the sewers work built in this way.”

He says Labour share the blame for failing to include environmental safeguards along with consumer protections when they designed the regulatory system but adds that the companies themselves must take responsibility. “I do believe that those companies should be held to account more directly by politicians.”

He adds that he hopes the Sunak regime will follow through on significant increases in fines that he proposed during his brief period in office. He’s not a wild swimmer he says but would he get into one of our rivers if he were? “Well I don’t swim,” he answers, which is very much not a ‘Yes’.


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