Sunday morning: tell the country we are definitely pressing ahead with the plan to scrap the 45p tax rate.
Monday morning: tell the country we are definitely scrapping the plan to scrap the 45p tax rate.
And with that, the new Prime Minister swiftly dismantled her own shaky argument that Britain’s growth would be spurred by attracting high earners through lower taxes.
The PM who promised to make big decisions has already rowed back on one of them. Her reasoning, we can assume, is that by doing so she will limit the damage of what was always going to be a highly controversial measure.
Yet as far as the markets are concerned, much of the damage was already done. We can also assume that suggestions the policy was in grave danger of being voted down by her own MPs will also have influenced her decision.
And what impact will this U-turn have? As far as the economy is concerned very little, according to the Institute for Fiscal Studies, which puts the tax cutting package down to £43bn from £45bn.
Politically however, the consequences are likely to be massive.
The latest self-inflicted disaster to hit Ms Truss’s struggling premiership has helped turn the ongoing Conservative Party conference into something resembling a wake. Events since the widely unpopular and market-destroying ‘mini-budget’ had already prompted a great deal of soul searching for many Tory MPs.
Now the mood has gone from grim to glum.
It has been less than a month since Ms Truss was elected Tory leader. In the immediate aftermath of her victory many of her MPs wholeheartedly got behind her pledge to unite the party. Even among those who still pined for Boris Johnson, there were plenty who were looking forward to a return to more traditional Conservative policies. Instead they found themselves forced into backing a new fiscal approach that appeared tailor-made to feather the nests of the rich.
Little thought – or care – appeared to have gone into how the measures would be viewed in ‘Red Wall’ areas, many of which the Tories landed for the first time ever in 2019. MPs who, begrudgingly, publicly supported the scrapping of the 45p top rate – let’s not forget they were threatened with losing the whip if they dared to oppose it – have now been made to look foolish.
And to compound their misery they will now be tasked with defending this embarrassing U-turn by peddling whatever claptrap line the Government comes out with (this is currently, “we have listened to the country”).
It is little wonder one Conservative MP likened the current situation to what Labour MPs went through ahead of the 2019 election.
Make no mistake, while the Government will be focused on getting out of a mess that is largely self-inflicted, MPs will already have one eye on the next general election.
As things stand the polls are a disaster, with the Tories hitting new lows. One gave Labour an eye-watering 34-point lead, while a former Downing Street pollster said a defeat at the next election was all but guaranteed.
There are genuine concerns in Tory circles that despite continued pledges over levelling up, the current administration is turning its back on the ‘Red Wall’. In the West Midlands, hard-working Conservative MPs know there is a real risk they will be losing their seats next time the country goes to the polls.
Some will perhaps consider that voters in this region are unlikely to return in large numbers to Labour, surmising that many of them will see through Sir Keir Starmer’s act and view the current version of his party as representing the woke agenda and little else. But as we saw in the North Shropshire by-election last year, massive majorities can easily be over-turned if Tory voters stay away. And stay away they will unless Ms Truss acts fast.
Currently, Tory MPs will have almost nothing to campaign on. Measures to address the energy crisis have been broadly welcomed, but the PM needs to show she has the political nous to get her party – and the country – through an extremely testing time.
By backtracking on a key policy her administration looks incompetent. She needs to go back to the drawing board and ensure that a clear plan is in place by the time MPs return to the Commons.
The PM also needs to show she is capable of working hand-in-glove with her Chancellor Kwasi Kwarteng, who thought it a good idea to attend a champagne reception with City of London financiers on the day of his mini-budget.
Even at this early stage, the Government cannot afford anymore poorly thought out decisions. The most damning indictment is that under Ms Truss, the Tories currently look as clueless and incompetent as Corbyn’s Labour.