After tax cut debacle, Truss pledges to steer UK through 'stormy days'

Prime Minister Liz Truss pledged on Wednesday to steer Britain through "stormy days" and transform its economy, fighting to restore her authority over a party in revolt after a chaotic first month in office.''

Addressing Conservative lawmakers and members at an annual conference overshadowed by internal bickering and confusion over policy, Truss said the party needed to unite to kick-start stagnant growth and tackle the many problems facing Britain.

So far, however, her misfiring attempt to cut 45 billion pounds ($51 billion) of taxes and hike government borrowing has sent turmoil through markets and her party, with opinion polls pointing to electoral collapse rather than a honeymoon period for the new leader.

"We gather at a vital time for the United Kingdom. These are stormy days," she said, referring to the COVID-19 pandemic, war in Ukraine and the death of Britain's longest reigning monarch, Queen Elizabeth.

"In these tough times, we need to step up. I'm determined to get Britain moving, to get us through the tempest and to put us on a stronger footing."

As she started to speak, two protesters held up a sign asking "Who voted for this?" before they were escorted away by security personnel as the crowd chanted "out, out, out".

Truss, elected by party members and not the broader electorate, was addressing the party faithful after she was forced to reverse plans to scrap the top rate of tax. She acknowledged that change brings "disruption".

That U-turn has emboldened sections of her party who are now likely to resist spending cuts as the government seeks ways to fund the overall fiscal program.

That risks not only the dilution of her "radical" agenda but also raising the prospect of an early election.

Having entered the conference hall to a standing ovation and the sound of M People's "Moving On UP", Truss told party members and lawmakers that she wanted to build a "new Britain for the new era".

"For too long, the political debate has been dominated by how we distribute a limited economic pie. Instead, we need to grow the pie so that everyone gets a bigger slice," she said in the central English city of Birmingham.

"That is why I am determined to take a new approach and break us out of this high-tax, low-growth cycle."

Crowning glory?

The conference, once expected to be her crowning glory after being appointed prime minister on Sept. 6, has turned into a personal nightmare, and a battle for the country's political future.

As the debate moved on from tax cuts to how the government would fund them, lawmakers and ministers openly clashed, in stark contrast to the sense of discipline on display at the opposition Labour Party conference last week.

Some lawmakers fear Truss will break a commitment to increase benefit payments in line with inflation, something they argue would be inappropriate at a time when millions of families are struggling with the cost of soaring prices.

Ministers say they are yet to take a decision and are obliged to look at economic data later this month.

While markets have largely stabilized after the Bank of England stepped in to shore up the bond market - albeit after the cost of borrowing surged - opinion polls now point to an electoral collapse for the Conservatives.

John Curtice, Britain's best known pollster, said before the speech that Labour now held an average lead of 25 percentage points and the Conservatives needed to accept they were "in deep, deep electoral trouble".

(REUTERS)