LONDON (Parliament Politics Magazine) – The Today show this morning has been featuring an interview with Rishi Sunak, the former chancellor who will only defeat Liz Truss in the race for the Tory leadership if several surveys turn out to be entirely off. He has recently accepted a lot of interviews, which may be partly explained by the fact that he performs well in front of the media but more likely reflects the fact that, as the underdog in the competition, he has nothing to lose. Truss, on the other hand, has consistently turned down requests for formal media interviews.
Sunak refused to promise to support Truss’ planned emergency budget in September in case she wins when speaking to Today host Amol Rajan. Given how strongly he disagrees with her proposal to roll back the national insurance hike that he implemented as chancellor, he has already stated that he would not accept a position in her cabinet. In his opinion, it would result in an unfunded tax cut, increase inflation, and benefit the wealthy disproportionately. Sunak avoided answering a question about whether he would support Truss’s plan if she won in the Tory hustings last night in Birmingham. Rajan made another attempt, this time asking Sunak if he would vote against Truss’ proposed emergency budget. Once more, Sunak remained silent.
He only replied saying that he wouldn’t engage in those things partly because it was wrong to act as though the race hadn’t ended.
However, elsewhere in the conversation he reiterated his assertion that Truss’s tax measures were essentially impossible.
He said that governing was difficult. It involves making tough trade-offs and making decisions.
Plans that seem to imply that you could have absolutely everything you wanted and didn’t have to make a difficult choice – that you could have lots of tax cuts, you could help people with the cost of living, borrowing didn’t matter, inflation would take care of itself – whether they came from his opponent, the energy companies, or anyone else – if all that sounded too good to be true, it probably was.
Sunak claims that freezing the energy price cap will necessitate excessive government borrowing
He explained his choice not to support proposals to freeze the present energy price cap by claiming that doing so would need excessive government borrowing. Energy price caps are being proposed by Labour and the Liberal Democrats, and many energy companies agree that they should be frozen at their current levels with a system in place to make up for the income they would lose. Sunak said that he had not directly discussed the proposal with the energy corporations. (He appeared to be alluding to the Scottish Power rescue plan request for £100 billion.) But he argued that this would need excessive borrowing. He stated:
That was a challenge that would persist for some time. In light of it, they needed to ensure that their actions were not only within their means but also wouldn’t worsen the inflation situation.
Additionally, at a time when they were already heavily indebted, he believed it was risky to implement policies and programmes that would permanently increase their debt by not just tens of billions of pounds but hundreds of billions as well. That was a discussion that had taken place during the leadership race.
He believed that was a gamble with people’s pensions, savings, and mortgage rates to further entrench inflation, and if that happened, nobody would benefit because inflation makes everyone poor. It was pernicious.
Therefore, he was nervous and dubious about programmes that were lax about that risk.
