Truss: I will put an end to ‘Stalinist’ housing targets
Tory leadership hopeful Liz Truss talks tax cuts, challenging Whitehall and why she is the candidate for change
LIZ TRUSS has pledged to scrap “Whitehall-inspired Stalinist housing targets”, as the Foreign Secretary said she would do away with “Labour approaches” in favour of tax cuts and deregulation to encourage firms to build new homes.
In an interview with The Sunday Telegraph, Ms Truss said she would deliver “the biggest change in our economic policy for 30 years”, to tackle decades of low growth and rising inflation.
Ms Truss intervened as she takes on Kemi Badenoch, the former equalities minister, for support from the Right of the Conservative parliamentary party. Ms Truss has told allies Mrs Badenoch would be offered a prominent role in her Cabinet if she won the leadership contest. In her interview, the Foreign Secretary would only say that her rivals were “incredibly talented” and she was a believer in “having all the players on the pitch”.
Meanwhile, Ms Truss suggested that she would lift the fracking ban to allow shale gas to be extracted using the hydraulic fracturing method in areas where there was local support.
She said it depended on “whether there is support in the area for it. But we need to be doing all we can to lower the cost of energy for consumers.”
The former chief secretary to the Treasury warned that business rates “hamper growth” and said she would “look again” at the Bank of England’s mandate “to make sure it is tough enough on inflation”. She voiced fears inflation has been worsened by excessive money supply. She added: “I would also have a very clear direction of travel on monetary policy.”
Ms Truss said she would amend the Levelling Up Bill to replace centralised targets with tax cuts and reduced red tape in “opportunity zones” to make it easier and quicker for developers to build on brownfield land in those areas.
She said: “I want to abolish the topdown Whitehall-inspired Stalinist housing targets, I think that’s the wrong way to generate economic growth.”
Ms Truss’s intervention comes after Michael Gove, the former housing secretary, distanced himself from the Conservatives’ manifesto pledge to build 300,000 homes per year.
She was one of the Government’s earliest and most enthusiastic adopters of Instagram. Now Liz Truss reveals the secret weapons in her social media strategy: her teenage daughters.
And Frances, 16, and Liberty, 14, have also taken to providing advice on the Foreign Secretary’s leadership campaign.
“My youngest daughter has been at quite a few campaign meetings and doesn’t hesitate to offer me a lot of political advice,” says Ms Truss.
“And actually, I’m not going to tell you what her advice is, but it’s been 100 per cent spot on so far.”
Frances is on her way back from an overseas school trip but has also “been keeping in touch”.
Ms Truss, 46, is sitting in an upstairs reception room in an 18thcentury London townhouse owned by Lord Howard of Rising, while her campaign team scuttle around downstairs. She has just finished a telephone call with Dmytro Kuleba, the Ukrainian foreign minister, with whom she has been in regular contact since Russia’s invasion.
The building, a little more than a stone’s throw from Parliament, previously acted as Boris Johnson’s initial operations centre for his bid to take over from Theresa May in 2019. Before that, it was Sir Iain Duncan Smith’s campaign headquarters. Earlier still, Michael Portillo was given the use of the building to plan his unsuccessful coup against John Major in the 1990s. The then Defence Secretary’s plotting was revealed when BT engineers were spotted installing 40 phone lines at the house.
Today, Ms Truss’s campaign relies more on discreet WhatsApp chats than BT landlines, but the Foreign Secretary has hardly been secretive about her leadership ambitions. Her rehearsal for this moment came in 2019 when she considered standing to succeed Theresa May, and carried out a series of interviews setting out her low-tax, small state vision.
Since then, a pandemic and war in Europe have contributed to sluggish growth and the highest inflation levels in 40 years.
But Ms Truss has set herself apart from Rishi Sunak by insisting that tax cuts are still a significant part of the answer – prompting accusations by the former chancellor during Friday night’s live TV leadership debate that she is pursuing a “fairy tale”.
Today she insists that the current approach, championed by Mr Sunak, is not working.
“Do we want a continuity economic policy, which has led to low growth for decades, and also isn’t doing enough in the current economic crisis we’re facing? Or do we have a bold new approach?
“I’m the candidate who has a vision for a bold new approach: supply-side reforms, tax cuts, getting a grip on public spending.”
Just as Ms Truss is urgently battling this weekend to be put through to the final stage of the leadership contest, she is conscious that the party as a whole has little time to be seen to deliver for the public.
“We need somebody who can hit the ground running ahead of the election in 2024 and really show people across the United Kingdom that we are
‘I opposed the National Insurance rise in Cabinet. I thought it was a mistake at the time’
delivering to them, we’re changing things on the ground, and that things are on the up.”
Ms Truss has already committed to a series of tax cuts, including reversing the National Insurance hike, stopping a planned increase in corporation tax and suspending the green energy levy on household bills.
In recent days rival candidates Penny Mordaunt, the trade minister, and Tom Tugendhat, the foreign affairs committee chairman, have also promised specific tax cuts, with Mr Tugendhat saying that he too would reverse the increase in National Insurance.
All of the candidates left in the leadership race, including Mr Sunak, are now promising supply-side reforms – a staple of Ms Truss’s pitch in 2019 and now. So how does she differ from her rivals on an economic front?
“This is not a new position for me on tax cuts. I opposed the National Insurance rise in Cabinet – I thought it was a mistake at the time. I also opposed raising corporation tax.
“And my view is that in these very difficult economic times, the last thing we should do is raise taxes, because we need to attract new investment to our country, we need to encourage people to get into work.”
“It is the wrong time to be raising taxes,” she adds, emphasising her differences with Mr Sunak, who intends to press ahead with the corporation tax increase.
Ms Truss also attempts to set herself apart from Ms Mordaunt, Mr
‘It is imperative we get on with delivering post-Brexit opportunities. We cannot afford to wait any longer’
Tugendhat and Kemi Badenoch – without mentioning any by name – by adding: “Where I differ is on delivery and experience. I’ve got a record of getting things done in Government.
“I’m somebody who is prepared to be bold … I am prepared to challenge the Whitehall orthodoxy. And that’s what we need to do. Because the orthodoxy isn’t working.
“And in order to deliver what we’ve promised,… in order to deliver a better life for our constituents around the country, we need to do things differently.”
Another tax at which Ms Truss reveals she intends to take aim is business rates. “In my view, they do hamper growth,” she states.
Ms Truss believes there has been a lack of ambition on housing. She wants to replace centralised targets with tax and regulatory incentives for firms to build new homes, which she considers far more likely to encourage companies to act.
“I want to abolish the top-down, Whitehall-inspired Stalinist housing targets, I think that’s the wrong way to generate economic growth,” she says. “The best way to generate economic growth is bottom up by creating those incentives for investment through the tax system, simplifying regulations.”
Ms Truss wants to amend Mr Johnson’s Levelling Up Bill to legislate for new low-tax “investment and building zones”. The centralised targets are a “Labour approach”, she says. “It’s not Conservative.”
She adds: “What I want to achieve is the biggest change in our economic policy for 30 years. That’s the scale of the challenge we face.”
As well as slashing taxes she wants to cut red tape “to get our economy moving”.
That includes overhauling the EU’s Solvency II rules which tie the hands of insurers, and “to liberate more of our pension funds to be able to invest in high tech startups”.
“We need to do things differently in terms of the way that we regulate – we need to get our economy moving.
“There is a tendency in Whitehall to be cautious, to be risk-averse and to be slow. But we cannot afford to wait any longer. There is an imperative that we get on with delivering those postBrexit opportunities.”
Ms Truss also appears concerned
about the Bank of England’s response to inflation. She says she would “look again” at the mandate agreed with the Government “to make sure it is tough enough on inflation”. And in a severe break with the Treasury’s approach to date she would set a “clear direction of travel” on monetary policy.
“I fear that some of the inflation has been caused by increases in the money supply. For me, handling inflation is an issue of monetary policy.
“And as well as having a very clear plan on how we reform the supply side, how we get public sector spending under control over time, I would also have a very clear direction of travel on monetary policy.”
Another preoccupation among many MPs on the Right of the Conservatives is fracking and she indicates agreement that the current ban should be lifted.
“I support the Net Zero objective, but we need to reach Net Zero in a way that doesn’t harm businesses or consumers ... I am very supportive of using gas as a transition fuel.
“On the subject of fracking, I think it depends on the local area, and whether there is support in the local area for it. But I certainly think we need to be doing all we can to lower the cost of energy for consumers.”
So she believes there is a strong case for lifting the ban and leaving local residents to decide whether fracking takes place in their area?
“Yes.”
Ms Truss hints each of her rivals would have a place in a Government that she led.
“I think Penny, Tom, Kemi, Rishi, are all great people who now have a strong future in the Conservative Party. I’m a great believer in having all the players on the pitch. And I would run my government as a team.”
Someone who would not play a role in No 10, however, is Ms Truss’s accountant husband Hugh O’Leary.
Mr Johnson has faced constant claims about his wife Carrie’s alleged involvement with decision-making - prompting the question, how involved would Mr O’Leary be?
“My husband, he’s a fantastic support to me and is very interested in politics. But I think it’s fair to say he’s never wanted to be on the front line of politics. He’s a great person, but I don’t expect him to be involved in the business of Government.”
Ms Truss will now be hoping that her campaign can make a hat-trick of successful bids launched from her Westminster headquarters, rather than going the way of Mr Portillo’s earlier attempt.