Truss says British economy ‘needs a reset’ after market sell-off

Prime Minister Liz Truss has said that “Britain’s economy needs a reset” and pledged to prioritize “aspiration, enterprise and growth” as the Conservative Party prepares to gather for its annual conference after a week of market turbulence.

MPs and party members will meet in Birmingham on Sunday and Truss is expected to try to rally their support for her political vision.

She is facing mounting dissatisfaction with the government’s £45 billion ‘mini’ budget last week, after which the pound fell to record lows against the dollar, gilts sold off sharply, banks withdrew thousands of mortgage products and the Bank of England launched a £65 billion bond purchase program to stabilize government bond markets.

Truss said Saturday night the Conservatives are “the party of aspiration, entrepreneurship and growth.”

“We believe in making it easier for our wealth creators, doers and doers to get things done,” she said. “Britain’s economy needs a fresh start. We cannot continue the current course of controlled decline. Instead, we must take a new direction. I will lead us on this path to a better future.”

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The overarching theme of the four-day conference is ‘Getting Britain moving’ and speakers will cover issues such as public services and fostering economic growth.

Truss, who is due to address Tory members on Wednesday, is expected to argue that the party remains committed to fiscal responsibility and that a high-tax, low-growth economy is an unsustainable approach.

However, some within the party have raised alarms about the impact of the government’s economic plans on public confidence. On Friday, Tory grandee Charles Walker warned that the Tories are at risk of losing the next general election, stressing that they have a responsibility to “put public finances in the best possible shape”.

Recent polls have revealed widespread public dissatisfaction with the government, with Labor rising to a 33-point lead, according to a poll released by YouGov earlier this week.

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Speaking to the Sun newspaper over the weekend, Truss acknowledged her government’s “mini” budget had caused short-term “disruptions” but insisted she has “a firm grip on national finances”.

“Not everyone will like what we’re doing, but I want to reassure the public that the government has a clear plan that I believe is right for the country,” Truss wrote.

Truss and Chancellor Kwasi Kwarteng met with officials from the Bureau of Fiscal Responsibility on Friday to reassure them of their commitment to reducing debt and boosting growth.

Kwarteng wrote in the Telegraph newspaper that even in the face of “extreme volatility in global markets” the government will prove to investors that its economic plan is “sound, credible and pro-growth”. He will address Tory MPs on Monday.

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The Chancellor is expected to outline his financial plans on November 23, along with projections of the economic impact of government policies through the OBR.

Leveling Secretary Simon Clarke warned that cuts in public spending may be needed to support Government policies. “I think it’s very hard to cut taxes if you don’t have the right spending profile and supply-side reform,” he said in an interview with the Times newspaper.

Welsh Secretary of State Robert Buckland denied on Saturday that investor unease was solely due to the “mini” budget.

“We have seen weakness in the pound, yen and euro against the dollar over the last few months,” he told BBC Radio 4’s Today program on Saturday. “I don’t think it would be fair to say that the Friday was the sole cause of the turbulence.”