• Thursday, December 01, 2022

HEADLINE STORY

From market chaos to ministerial exits, UK leader Truss’s time in office

By: Pramod Thomas

British Prime Minister Liz Truss is fighting for her political survival after only six weeks in the job.

Below is a timeline:

SEPT. 5 – TRUSS WINS LEADERSHIP CONTEST

Truss is elected Conservative Party leader by the party’s membership, winning 57% of the vote to succeed Boris Johnson.

SEPT. 6 – TRUSS OFFICIALLY BECOMES PM

Johnson formally tenders his resignation to Queen Elizabeth and Truss is appointed prime minister.

SEPT. 8 – TRUSS ANNOUNCES ENERGY SUPPORT PACKAGE

Truss announces the government will cap soaring consumer energy bills for two years to cushion the economic shock of war in Ukraine, a plan expected to cost the country tens of billions of pounds.

SEPT. 8 – QUEEN ELIZABETH DIES

The British monarch dies at 96. Ten days of national mourning begin, effectively putting politics on hold.

SEPT. 19 – QUEEN’S FUNERAL

Truss makes her first appearance on the international stage as prime minister by giving a Bible reading at the funeral.

SEPT. 20-21 – TRUSS TRAVELS TO UN

Truss travels to the United Nations General Assembly in New York, her first foreign trip as prime minister, and has her first in person meeting with U.S. President Joe Biden.

SEPT. 23 – MINI-BUDGET

Truss’s finance minister Kwasi Kwarteng sets out a “mini-budget” which includes 45 billion pounds ($50 billion) of unfunded tax cuts and huge increases in government borrowing, sending sterling and British government bonds into freefall.

He is criticised for failing to publish growth and borrowing forecasts from the Office for Budget Responsibility (OBR) government watchdog alongside the budget.

SEPT. 26 – BANK OF ENGLAND CONCERNED

The central bank says it will not hesitate to change interest rates and is monitoring markets “very closely”, after the pound plunged to a record low and British bond prices collapsed in response to the new government’s financial plans.

SEPT. 28 – BANK OF ENGLAND STEPS IN

The Bank of England seeks to quell the firestorm in Britain’s bond markets, saying it will buy as much government debt as needed to restore order.

SEPT. 29 – TRUSS STICKS TO HER PLAN

Truss breaks her silence after nearly a week of market chaos to say she is prepared to make controversial and difficult decisions to get the economy growing.

OCT. 3 – U-TURN ON TOP RATE OF TAX

Truss and Kwarteng are forced to reverse a planned cut to the highest rate of income tax after turmoil in markets and opposition from many of their own Conservative lawmakers.

OCT. 6 – TRUSS ATTENDS MEETING OF NEW EUROPEAN CLUB

Truss attends the inaugural meeting of the European Political Community in Prague, with some hoping her decision to attend was the sign of a reset in relations between Brussels and London.

OCT. 10 – KWARTENG BRINGS FORWARD BUDGET DATE

Under pressure to rebuild shattered investor confidence, Kwarteng brings forward the publication date for fiscal plans and economic forecasts to Oct. 31, from Nov. 23.

OCT. 11 – BANK OF ENGLAND ACTS AGAIN

The Bank of England expands its programme of daily bond purchases to include inflation-linked debt, citing a “material risk” to British financial stability and “the prospect of self-reinforcing ‘fire sale’ dynamics”.

OCT. 12 – NO PLANS TO REVERSE TAX CUTS

The government says it will not reverse its vast tax cuts or reduce public spending despite ongoing market turmoil. British government borrowing costs hit a 20-year high.

OCT. 14 – TRUSS SACKS KWARTENG, U-TURNS ON CORPORATION TAX

Truss fires Kwarteng and acknowledges her government’s plans had gone “further and faster” than investors were expecting. She appoints Jeremy Hunt as his replacement.

She also announces corporation tax will rise to 25%, reversing an earlier plan to freeze it at 19%, and says public spending will have to grow less rapidly than previously planned.

OCT. 17 – NEW FINANCE MINISTER HUNT REVERSES MOST OF BUDGET

Hunt reverses nearly all of the mini-budget and reins in the vast energy subsidy plan, saying the country needs to rebuild investor confidence. He says changes to planned tax cuts will raise 32 billion pounds and government spending cuts will also be needed.

OCT. 19 – INTERIOR MINISTER RESIGNS, CHAOTIC PARLIAMENT VOTE

Home secretary Suella Braverman resigns after breaking rules by sending an official document from her personal email. She also says she has serious concerns about the government and that just hoping problems would go away is not a viable approach.

Hours later, Conservative lawmakers openly row amid confusion over whether a vote on fracking is a confidence vote in the government. The government wins the vote but more than 30 Conservatives do not take part and Truss’s office says those without a reasonable excuse can expect disciplinary action.

(Reuters)

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