Liz Truss urges PM to cut taxes a year after Downing Street exit

Liz Truss has vehemently defended the policies she tried to enact during her short time as prime minister.

She acknowledged that she tried to do things in a rush in her time in office.

But the Tory MP argued that she could not deliver her plans due to the "political and economic establishment", blaming "institutional bureaucracy".

The former PM also called on Rishi Sunak to cut taxes, reduce benefit increases, raise the retirement age and delay net-zero commitments.

Her speech at an event held by the Institute for Government think tank comes almost a year after her government unveiled a series of economic measures - described as a mini-budget - that included £45bn of tax cuts alongside support for people struggling with rising energy bills.

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The plans triggered weeks of economic turmoil and just a few weeks later Ms Truss was forced to scrap almost all of the measures.

Her premiership did not survive the massive U-turn and she resigned on 20 October 2022, less than a month after the mini-budget.

The speech is one of the few occasions she has spoken in public about her tenure and she said: "Some people said we were in too much of a rush.

"And it is certainly true that I didn't just try to fatten the pig on market day - I tried to rear the pig and slaughter it as well. I confess to that.

"But the reason we were in a rush was because voters wanted to see results.

"I knew with the level of resistance and the lack of preparation time that things weren't going to be perfect."

She said that communication "could have been better and the operation better honed" but also that she was unable to implement her plans because there was a "powerful force comprising the economic and political elite, corporatists, parts of the media and even a section of the Conservative parliamentary party" opposed to her ideas.

She also argued that her tax cuts were not unfunded as they would have increased revenue in the long term.

In addition to reflecting on her time in office, Ms Truss used her speech to urge the government to reinstate VAT-free shopping for tourists and abolish the windfall tax on oil and gas firms.

"We need to get a grip on the ballooning welfare and pensions bill. This means slowing the rate of increases to benefits and tougher work requirements. It also means raising the retirement age further," she said.

'System problem'

During a question session following her speech, Ms Truss further defended her policies.

Following her mini-budget, interest rates jumped sharply leading to rising mortgages and hundreds of products being removed from the mortgage market.

However, the former prime minister said interest rates had been "artificially low" for many years and would have risen, regardless of her policies.

Ms Truss also criticised the civil service, saying that while she had worked with "brilliant people" there was a "system problem".

Asked for examples of civil service interference, she said officials tended to be more enthusiastic and active when implementing climate policies, compared to delivering the government's plan to send migrants to Rwanda.

She also hit back at Mark Carney - the former Bank of England governor - who, over the weekend, said Ms Truss had failed to turn the UK into "Singapore-on-Thames" but instead delivered "Argentina-on-the-Channel".

Ms Truss said Mr Carney had contributed to the "25-year economic consensus that has led to low growth across the western world".

Having largely spent the past year since leaving No 10 keeping a lower profile, Ms Truss is likely to become more vocal in the next 12 months.

She is writing a book - due for publication in April - entitled Ten Years to Save the West, in which she will "share the lessons" from her time in government.

She will also attend the Conservative Party conference in Manchester later this month.

Liz Truss said she did not want to participate in a Conservative Party soap opera - so there was no direct attack on her successor as PM.

But the policy gulf between her and Rishi Sunak was obvious.

She advocated the opposite of many of the policies he was pursuing.

From corporation tax - which she wanted cut - to the very top rate of income tax, which she wanted to abolish.

If she had regrets, they really were almost too few to mention.

She did admit perhaps she had gone a bit too quickly.

She used a porcine analogy to concede she hadn't just tried to fatten the pig on market day, she had reared and slaughtered it in the same timescale.

But she argued that when she herself had faced the chop, it wasn't because her policies had been wrong.

It was instead down to a rogue's gallery of opponents who had undermined her: The political and economic establishment, parts of the media and a chunk of her own parliamentary party.

Her speech wasn't just of historic interest.

It is worth remembering that a majority of rank-and-file party members had backed her leadership bid last year.

Although she said she didn't envisage a return to Downing Street, were her party to lose power at the next election, a debate over its future direction is likely to ensue - and others may take on her free market mantle.

Downing Street said Rishi Sunak had not watched the speech, but when asked for his response, Business Minister Kevin Hollinrake said: "I don't think there's any other option than to do what the prime minister is doing now, which is we need to balance the books at the same time as we're doing other things like growing the economy."

However, it did spark criticism from opposition politicians, as well as some from her own party. Conservative MP Conor Burns - whom she sacked - said: "She is a drag anchor to any cause she attaches herself to. And toxic on the doorsteps. Only service she could provide is sustained silence."

Another Conservative MP and former minister Damian Green said: "It's been a year since Liz wrote a Budget. I'm glad she's not responsible for this year's."

Rupert Harrison - the economic adviser to former Conservative Chancellor George Osborne - wrote on X, formerly Twitter, that Ms Truss had a "brass neck" adding: "To presume to offer advice after what happened. And still no genuine acknowledgment of the real mistakes that were made. Happily, nobody in the Conservative Party or the government is listening."

Responding to her speech, the Liberal Democrat's deputy leader Daisy Cooper said: "Liz Truss giving a speech on economic growth is like an arsonist giving a talk on fire safety."

Meanwhile Labour have called on the prime minister to block Liz Truss's resignation honours list. Labour's shadow paymaster general Jonathan Ashworth argued that "those who crashed the economy" should not be rewarded.