Tory leadership – live: Truss tax plans could force cuts to public services, warns Sunak ally

Keir Starmer ‘really hated’ Beergate police investigation

The UK government has said that they are “disappointed” that the European Commission has launched new legal action against the UK.

They said that a “legal dispute is in nobody’s interest” and “will not fix the problems facing the people and businesses of Northern Ireland.”

Earlier this afternoon, the European Union launched legal action against the UK over failures to comply with the post-Brexit Northern Ireland Protocol in a further souring of relations.

The European Commission triggered four new infringement procedures on Friday. They said that it had been forced to act because the UK had failed to take part in “meaningful discussion” over the Northern Ireland protocol since February.

The commission accused the UK of failing to comply with customs requirements and not imposing EU rules on VAT for e-commerce.

The move will increase the heat on Liz Truss, who as foreign secretary has had oversight of the negotiations with Brussels.


Little justification for cutting taxes, economist says

There is little justification for cutting taxes in the UK, a top economist has said as the two remaining Tory leadership candidates face off over the tax issue.

Philip Shaw, chief economist at banking group Investec, said that it will be tempting to give people more money in their pockets as the cost of living soars.

But “there is little economic justification to cut taxes right now, despite the cost-of-living crisis resulting in an obvious temptation,” he said.


‘A legal dispute is in nobody’s interest’, says UK after EU legal action over Brexit

A government spokesperson has said that they are disappointed that the European Commission has launched new legal action against the UK.

They said that a “legal dispute is in nobody’s interest”.

A spokesperson said: ““It is disappointing that the EU has chosen to bring forward further legal action, particularly on goods leaving Northern Ireland for Great Britain which self-evidently present no risk to the EU single market,” a government spokesperson said.

“A legal dispute is in nobody’s interest and will not fix the problems facing the people and businesses of Northern Ireland. The EU is left no worse off as a result of the proposals we have made in the Northern Ireland Protocol Bill”.


Both potential Tory leaders would be ‘terrible for Scotland’, Nicola Sturgeon says

Both Liz Truss and Rishi Sunak would be “terrible for Scotland” if they became prime minister, Scotland’s first minister Nicola Sturgeon has said.


EU move makes it harder for next PM to compromise, says Theresa May’s former adviser

Theresa May’s Europe adviser, Raoul Ruperal, has said he thinks the EU Commission’s approach and timing of its new legal action against the UK is “unwise”.

He argued that it would make it harder for the next Tory leader to compromise with the EU.


Interest rates will have to rise as high as 7%, says Truss economic guru

Interest rates will have to rise as high as seven percent to allow for future tax cuts, an economist cited by Liz Truss has said.

Professor Patrick Minford was mentioned by the foreign secretary as one of the few economists who agreed with her wide ranging tax cuts.

Mr Minford has now told The Times that high interest rates were a “good thing” because they protected savings. He also said they killed off “zombie companies” who were slowing down economic growth.

Mr Minford, who has been advising Ms Truss’ campaign, said: “Getting rid of a lot of regulations will upset a lot of pressure groups. But it all really starts in Whitehall and the first thing [Truss] has got to do is get Treasury into line.”

However he said that, rather than arguing for tax cuts, he was wanting to not put them up.

“The key to growth is not having high taxes,” he said. “We’re not talking about cutting them, we’re just talking about not putting them up to a catastrophic level.”

He conceeded that interest rates will have to go up, saying: “A normal level is more like 5-7 percent and I don’t think it will be any bad thing if we got back to that level.”


Sunak to push ahead with privatisation of Channel 4

Rishi Sunak has said that he will continue with the government’s commitment to privatise Channel 4 if he becomes prime minister.

The move is also thought to be supported by foreign secretary Liz Truss.

A Sunak campaign spokesperson told The Guardian: “Rishi will take forward Channel 4’s privatisaion. Channel 4 is a crucial part of British broadcasting and supports our brilliant creative industries, but a lot has changed since the 1980s when it was set up to provide viewers with more choice.

“Privatisation will help Channel 4 to thrive in an age where they are also competing with Netflix, Amazon, Apple and many more – standing still is not an option.”


UK has already paid £120m for Rwanda deal

The UK has already paid Rwanda £120million to take migrants despite no one yet being sent to the country due to legal challenges.

Rwandan officials have confirmed that it has received the entire initial payment for the deal.

When asked by reporters how much money had already been paid by the UK, Rwandan government spokeswoman Yolande Makolo said: “There was an initial transfer of £120 million. This has already been paid and we are already using the funds to prepare.”

Rwanda remains “committed” to the partnership, she added.


Ukraine Russia expert Tim White to answer reader questions about the conflict in ‘Ask Me Anything’ event

Can Ukraine really win this war? Will Russia need to move to full mobilisation, with forced conscription?

Tim White, who has been tweeting detailed updates every day since the war began, will be on hand to answer any questions readers may have, as we approach 150 days since Russia invaded Ukraine in February.

As the West steps up its support for Ukraine, readers will have the chance to ask questions about all things to do with the Russia conflict during an ‘Ask Me Anything’ on today at 2pm.

See below on more details to join the event:


Kemi Badenoch angles for position in new PM’s government

Kemi Badenoch, who came fourth in the Tory leadership contest, has said that she has “worked hard enough” to be given a job in the new PM’s government.

She revealed to The Telegraph that she only decided to run for the leadership the day after Boris Johnson resigned and that her children only found out about her bid from the TV news.

Speaking about the potential of a position in the new government, Ms Badenoch said: “It’s going to be up to whoever is the prime minister to decide what they think I would do best. And I like to think that I’ve worked hard enough now to show that I can do things. They might not give me anything.”

Speaking about launched her bid for leadership, she said: “My children are quite young. So they found out on TV – ‘Mummy’s on TV’ – and they got very excited about the counting.”


Truss tax cuts will push up inflation, says Sunak

Rishi Sunak has warned that Liz Truss’s tax-cutting plans – worth at least £30bn a year – will mean a “huge borrowing spree” and push up inflation and interest rates.

The former chancellor did not pull any punches in an interview with LBC. Sunak said he thought borrowing for unfunded tax cuts would be “inflationary”.

Sunak is understood to be keen to wait until autumn 2023 before cutting income tax, if inflation can be brought down by next summer.

He claimed Truss’s plans were “unfunded” – adding that going on a “huge borrowing spree” would only “make the situation worse”.

Sunak said his plan to put corporation tax up was “perfectly reasonable”, claiming his economic plan to wait to bring down inflation before tax cuts is “common sense Thatcherism”.

The former chancellor is understood to be keen to wait until autumn 2023 before cutting income tax, if inflation can be brought down by next summer.

Source: UK Politics -


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