Politics

Kwasi Kwarteng accused of disregarding mini-budget warnings

Kwasi Kwarteng says he 'regrets turbulence' in market after mini-budget

Kwasi Kwarteng was warned about how disastrous the mini-budget could be but went through with his plans anyway, apparently.

Speaking at a treasury select committee, top civil servants outlined how they gave the then chancellor appropriate advice, warning him about how the financial markets could respond to his policies, but said he did not take it on board.

James Bowler, the treasury's top civil servant told the MP he was “absolutely confident treasury officials set out the right advice” to the then chancellor.

He said that they could not persuade Kwarteng to change his view, saying “officials advise but ministers decide”.

Meanwhile, Beth Russell, joint second permanent secretary said that her colleague Cat Little and her were "confident that we gave all the advice to ministers on the economic and fiscal backdrop, the impacts and the market position and particularly around the financing requirement, which was a big issue because of the cost of the measures.”

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Asked if there was more they could have done, she said: “Ultimately the decisions here are for the ministers. It’s our job to make sure we give the best advice possible on the impacts and the consequences, and I think we both feel we did that on the situation in the markets.”

In case you've blocked it out of your mind, the mini-budget was the one thing Kwarteng and then prime minister Liz Truss got around to doing in the seven weeks they were in power. It completely tanked the economy and became the main reason she was forced to resign.

Bowler said this and other major events had impacted civil servants.

“It’s been a tough year for Treasury civil servants,” he said. “There’s been a lot of crisis upon crisis, so Covid, Ukraine energy, so the mini-budget came on top of that.

"Political change, so four chancellors since the summer, and in some quarters negative commentary on Treasury civil servants, none of that has been helpful. In terms of morale I think that has had an impact but staff understand they’re working on really, really important areas.”

The more we learn about the mini-budget, the more infuriating it becomes.

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