From frying pan to fire: UK PM Truss replaces acolyte FM with a rival to perk up the economy
Virendra Pandit
New Delhi: Embattled British Prime Minister Liz Truss, barely 40 days after moving into 10 Downing Street in London, has been forced to replace his acolyte Kwasi Kwarteng as the Chancellor of Exchequer with a rival, Jeremy Hunt, in a last-ditch effort to reassure the financial markets where the country’s currency pound has tanked to over 20 percent in a matter of weeks.
Hunt was a high-profile supporter of Truss’s main opponent, Indian-origin Rishi Sunak, during this summer’s leadership campaign, praising his “formidable ability” as the former Chancellor.
While Hunt has no Treasury experience, he has been running his education business Hotcourses as ‘evidence’ of his business acumen.
Under extreme pressure from her own Conservative Party, the opposition Labour, and amid the global economic chaos, Truss, 47, hopes that having Hunt, 55, by her side might help convince investors that her fiscal plans can work, the media reported on Saturday.
Hunt’s entry as her finance minister, she believes, might appease the many Tory lawmakers alarmed by her decision to surround herself with ideological loyalists, rather than experts, after she took office on September 6. Amid fervent calls to bring Rishi Sunak back to set the economy right, they are angry by the chaos she has unleashed on the markets and the party.
The third woman PM, Truss expects Hunt to put the public finances on a sustainable path, sacrificing no more of the controversial package of tax cuts that tipped the administration into crisis three weeks ago.
While Truss had to ditch her cherished plans to reduce taxes for the highest earners and on Friday announced an increase in corporate levies to wipe out almost half of her £45 billion (USD 50 billion) giveaway, she still needs to find another £24 billion to get debt falling relative to GDP, the reports said.
During the debates for the leadership race a few months ago, Hunt wanted to continue with a rise in national insurance, rather than reverse it as Truss has since done. He also advocated increased spending on healthcare and defense. But he was eliminated from the contest in the first round of voting.
Irrespective of Hunt’s success in his new job, the fact is, Truss had brought in a potentially ‘dangerous rival’ who could replace her.
“You should see Liz Truss as the chairperson and Jeremy Hunt as the chief executive. And he’ll be a very effective chief executive,” Steve Brine, a Tory lawmaker, and a Hunt ally told the BBC. “But he’s obviously made no secret of the fact he wanted the top job.”
Hunt served as a cabinet minister under David Cameron and Theresa May. He ran the health department for six years before becoming a foreign secretary for a year. In 2019, Boris Johnson defeated him in the prime ministerial sweepstakes.
Thereafter, he led the health and social care select committee, hitting the headlines by grilling ministers and officials over the government’s much-criticized response to the Covid pandemic.
