It will be devastating. A high cost of living on top of the recession will be a blow to ordinary families. It’s not just a bunch of numbers on a balance sheet, it’s a human nightmare of lost jobs and missed mortgage payments. With bills already rising and families having to cut spending, imagine the pressure on families if they find themselves spiraling into unemployment.
The Center for Social Justice has clear evidence that when families get into debt, they are more likely to break up, which puts enormous pressure on children. Such a breakdown greatly expands the terrible effect of a recession on families across the country, Liz is right, we must not make the current difficulties even more difficult.
As independent economists have pointed out, there are ways to reduce the pain. After all, inflation is currently being driven by supply-side factors, following the pandemic, compounded by weak monetary policy. We do not have an overheated economy.
That’s why Liz Truss is right to call for tight monetary policy to fight inflation, but looser fiscal policy in the face of weaker demand.
To that end, evoking a former prime minister who challenged orthodoxy, Liz Truss’ determination to cut taxes is the right move.
Halting the corporate tax hike will encourage investment in a competitive global market.
Getting rid of the job-killing National Insurance hike and suspending green levies will help average families.
But above all, this looser fiscal policy will encourage vital growth and benefit all British families.
Liz also clarified that where needed, she will ensure targeted support reaches those most in need as inflation and the cost of living rise.
The Conservative Party was elected to challenge the orthodoxy that has provided low growth in Britain for too long. Sure, we had the pandemic, but that should spur us on to stick to our manifesto and not break the promises made in 2019.
We were elected to improve the quality of life for people in areas that have been neglected for too long by leveling up. We were not elected to implement the national insurance tax.
Keeping our commitments is what we must do now.