UK’s Kwarteng promises to bring public spending under control

THE British government will make a new “commitment” to bring public spending under control following a week of financial turmoil, British finance minister Kwasi Kwarteng said in an op-ed in The Telegraph on Friday.

Kwarteng vowed to publish a “credible” plan in November to reduce debt.

He also doubled down on his mini-budget, writing that while some measures may not be universally popular “we had no other choice.”

Kwarteng unveiled a string of lower taxes last week that were, unusually, not accompanied by forecasts from the Office for Budget Responsibility (OBR).

Sterling fell to a record low against the US dollar and the sell-off led the Bank of England to intervene with emergency bond-buying to protect pension funds from partial collapse.

In his article in the newspaper, Kwarteng wrote: “The Medium-Term Fiscal Plan will set out a credible plan to get debt falling as a share of GDP in the medium term, with new fiscal rules and a commitment to spending discipline. And this will be alongside a full forecast from the Office for Budget Responsibility.”

SEE ALSO

Truss says UK tax cuts are the ‘right plan’ amid market rout

Lessons for Truss when economic orthodoxy bites back

UK economy still below pre-pandemic size, underscoring challenge for Truss

Sterling slips after Truss, Kwarteng meet fiscal watchdog

More

DECODING ASIA

Navigate Asia in
a new global order

Get the insights delivered to your inbox.

British Prime Minister Liz Truss said on Friday she recognised there had been some financial market disruption following the government’s so-called mini budget and that it was important monetary and fiscal policy are coordinated. REUTERS