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Within 3 weeks, the UK’s new PM Liz Truss loses sheen as Tories want her challenger Rishi Sunak back!

Within 3 weeks, the UK’s new PM Liz Truss loses sheen as Tories want her challenger Rishi Sunak back!

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Virendra Pandit

 

New Delhi: “Come back Rishi Sunak, all is forgiven”, reads an editorial in The Daily Telegraph on Tuesday.

Will he have the last laugh?

Within 20 days, the new British Prime Minister Liz Truss has lost her sheen as the country still grieving the loss of the former Queen, Elizabeth II, is facing the highest inflation in 40 years, as she spearheads the biggest tax cuts in 50 years.

Her own party members want Indian-origin former Chancellor Rishi Sunak back to rescue the world’s sixth largest economy from an unprecedented meltdown.

On Thursday, the plummeting British pound sterling was worth only USD 1.08.

After weeks of controversies—including an alleged racial bias and the pique of being ruled by someone from a former ‘slave’ India—Liz Truss had taken an oath as the new British PM only on September 10. Her chief challenger, Sunak, was seen as fading out.

Now, the son-in-law of Indian IT behemoth NR Narayan Murthy might bounce back.

Rishi Sunak, 42, served as Chief Secretary to the Treasury from July 2019 to February 2020 and as Chancellor of the Exchequer from February 2020 to July 2022. A member of the Conservative Party, he has been the Member of Parliament for Richmond since 2015.

The Sunak supporters in the ruling Conservative Party leadership race, which concluded earlier this month with opponent Liz Truss elected as British Prime Minister, are increasingly reiterating what their former Chancellor had warned against, the media reported on Thursday.

While Sunak himself has remained reticent and conspicuously silent, his backers within the ruling party and others recall how the so-called Trussonomics of illogical tax cuts and higher borrowing have spooked the markets worldwide and sent the pound sterling tumbling against the US dollar.

During the Tory leadership contest, Sunak had clearly warned that Liz Truss’ plans to borrow to fund tax cuts were dangerous’ and risked making everything worse. His prophecy, dismissed as doomsterism, has already come to haunt London, it said.

Huw Merriman, a Tory MP who chairs the House of Commons Transport Select Committee and a prominent ally of Sunak during the eight-week-long leadership election campaign after Boris Johnson quit, took to Twitter in response to a new YouGov poll in The Times‘ showing the Opposition Labour Party race ahead with its biggest lead in over a decade at 17 points over the ruling party.

Those of us who backed Rishi Sunak lost the contest, but this poll suggests the victor is losing our voters with policies we warned against, said Merriman.

For the good of our country, and the livelihoods of everyone in our country, I still hope to be proven wrong, he said.

In a BBC interview last month on the campaign trail, Sunak reiterated his policy plank of a measured approach to tax cuts and offering targeted financial help to the most vulnerable people to address the cost-of-living crisis.

“Liz’s plans are promising the earth to everybody. I don’t think you can have your cake and eat it. I don’t think life is that simple, and I think her plan risks making everything worse,” he said.

Citing these warnings, Lord Gavin Barwell, who was Downing Street chief of staff for former Prime Minister Theresa May, said this week: “I think people are pretty furious with those who acted as cheerleaders for the government’s policy when many, not least Rishi Sunak, warned exactly what the consequences would be.”

The reaction follows the much-hyped mini-budget being tabled by Truss’ new Chancellor, Kwasi Kwarteng, in the House of Commons on Friday, the media reported.

It has since seen the cost of borrowing soar as the financial markets reacted adversely to the announcement of the biggest tax cuts for 50 years to be paid for by additional government borrowing.

The Bank of England said on Monday it would “not hesitate” to hike already high-interest rates further after the pound hit record lows.

Concerns among investors about the UK’s ability to meet its rising public debt are believed to be behind the value of the pound being pushed down while the cost of UK government borrowing is pushing upwards.

A weaker pound also makes imports and goods priced in dollars, such as oil, costlier and risks fuelling price rises at a time when UK inflation is already at its highest for 40 years.

 

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