UK Prime Minister Truss faces severe stress to resign after a failed finances

LONDON – British Prime Minister Liz Truss is facing calls for her resignation from her own Conservative Party just six weeks after she entered Downing Street.

Truss and her former finance minister, Kwasi Kwarteng, announced a tax package — known as a mini-budget — on Sept. 23. The measures sparked market turmoil, from a falling pound to bond panics, and a rare public censure from the International Monetary Fund.

Bit by bit, the plans have been refined and scuttled — including rolling back plans to eliminate a corporate tax hike, scrapping plans to eliminate the top income tax bracket, and cutting the Energy Guarantee, which aims to subsidize consumer and business energy bills two years to just six months.

The latest plans were announced by Jeremy Hunt on Monday, just three days into his tenure as Treasury Secretary. He is the fourth person to fill the position since July.

Truss fired Hunt’s predecessor on Friday, and now lawmakers across the political spectrum are demanding she follow him outside.

Elected members of Truss’s own party are openly calling for their resignation, while up to 100 members of the party are said to have tabled letters of no confidence in the prime minister, the newspaper i reports.

Angela Richardson, Conservative MP for Guildford, said on Times Radio on Monday that it was “no longer tenable” for Truss to remain Prime Minister, while Jamie Wallis, Conservative MP for Bridgend, wrote to the PM urging her to step down.

“I am asking you to resign as Prime Minister as I believe you no longer enjoy the confidence of the country or the parliamentary party,” Wallis said in the letter. “It’s the right thing to do to ensure the stability, security and prosperity of the people to whom we owe everything.”

Truss' scrapped tax cut plan couldn't have come at a worse time, says KPMG's tax policy chief

The leader of the opposition Labor Party, Keir Starmer, said via Twitter on Saturday: “The Tories no longer have a mandate from the British people.”

Labor has also urged Truss to face scrutiny by lawmakers after she answered just four questions from reporters at a news conference on Friday.

“Liz Truss has to at least take [questions] of MPs representing the families whose livelihoods she is jeopardizing,” Starmer said.

According to The Guardian, Opinium Research polls for the Trades Union Congress show Labor will win a landslide victory in the next election.

It’s not just current MPs that are already giving Truss’ leadership time.

Former Conservative Treasury Secretary George Osborne said on Channel 4’s The Andrew Neil Show on Sunday that the “likeliest outcome is her falling before Christmas”.

More instability lies ahead

Truss’ policies – and their reversal – have gripped the financial world, leading banks to question the Prime Minister’s future.

“It is not easy to see how Truss – whose personal mandate is now in shambles – can continue as prime minister for long,” said analysts at Berenberg Bank.

“We wouldn’t be surprised if Conservative MPs pressured Truss to resign [the] in the coming days. With more than two years to go before general elections need to be held (January 2024), the Conservative Party may decide the best way to stay in power is to move on quickly with a new leader,” Berenberg analysts said.

Citi went further and questioned whether Truss’ party would be able to weather and survive the current economic crisis.

“The fundamental question here is whether a conservative leader can provide credible economic direction. We are increasingly insecure,” the bank said in an analysis note.

“The implication is that PM Truss is now faced with pressure between their parliamentary party on the one hand and the markets on the other. … We believe further market instability is likely to ensue,” it said.

The Cabinet Office did not immediately respond to a request for comment.

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