Financial secretary to the Treasury, Andrew Griffith, has defended the government’s tax-cutting measures outlined in the mini-Budget, after they were subjected to fierce criticism this week.
The tax cuts have been greeted by an extraordinary market reaction, with the cost of borrowing surging and the pound sterling falling in value.
Labour leader Sir Keir Starmer has called on ministers to renege on the mini-Budget and recall Parliament, a plea which Downing Street has rejected.
Sir Keir's party has also been pressuring government throughout the week to publish in detail how the Treasury intends to finance the measures and reduce public debt in the longer-term.
Elsewhere, the International Monetary Fund has called on the government to reconsider implementing large-scale tax cuts at a time of inflationary pressure, warning that it could widen the inequality gap and exacerbate cost-of-living woes.
However, Griffith (pictured) has rebuffed the calls and insisted that the government’s approach is the “right” way to instigate growth.
He is the first minister to comment publicly on the market reaction to the mini-Budget. Peer and former minister of state at the Cabinet Office, Lord Frost, had publicly referred to the market turmoil as an “overreaction” prior to Griffith’s statement.
Griffith said that “every major economy is dealing with exactly the same issues” that the UK is facing, and the government was right to cut tax to address the “underlying problems in the economy.”
Highlighting that the UK had one of the best debt to GDP ratios in the world’s major economies, Griffith said: “We think they (the tax cuts) are the right plans, because those plans make our economy competitive.
“At the end of the day, that's ultimately what we've got to do.”
He praised the Bank of England’s decision to step in and control the soaring cost of borrowing by purchasing government bonds, saying that they had “done their job” in doing so.
Photo by Richard Townshend on Wikimedia Commons
