The resignation letters finally released on July 6, 2022, is that the chancellor felt his approach to the economy was fundamentally too different from that of Boris Johnson. The context was the PM’s plan for a joint speech with the chancellor as the plan’s anchor to show the government taking control of the cost of living crisis. The article contains The Resignation Letters by Rishi Sunak Released.
That speech was due. They could not agree on its contents. Notably, the chancellor said the public is ready to hear the truth about the tough times ahead. This echoes some comments by Mervyn King, Former Governor of Bank of England that the government should level with the public about the fact that the inflation energy crisis has made the nation poorer.
The cost-of-living crisis means a series of complicated trade-offs for the government in the upcoming months. Public sector pay review bodies have started to report back. The Treasury believes it is irresponsible to even discuss pay claims matching the 9% inflation. However, yet, a 10% rise in pensions is penciled for 2022.
Governments are facing rising costs to provide public services, but cash budgets are yet to be increased. As a result, tax cuts are being promised, but only in two years, if borrowing is under control. Fuel prices reached new records, but the 5p Budget reduction didn’t go. Domestic energy prices are going even higher than predicted at the time of the chancellor’s final cost of the living package.
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