'He wants to return to the 70s': Former Chancellor Kwasi Kwarteng slams Burnham's 'socialist' cost-of-living measures
Mr Kwarteng said that the policies were due to the new Prime Minister wanting to be popular but insisted he should prioritise growing the economy
Former Chancellor Kwasi Kwarteng has accused Andy Burnham of wanting Britain to return to the 1970s after announcing 'socialist' cost-of-living measures on his first full day in office.
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After declaring that Britain needs a "cost-of-living" government, the new Prime Minister announced that VAT on energy costs would be abolished from October 1.
The measure will reportedly save households around £45 a year.
The move will cost the Exchequer £850 million - and has triggered backlash from one ousted Starmer ally who branded the cut “unfunded”.
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Mr Kwarteng, whose short spell in Number 11 Downing Street serving in Liz Truss' government coincided with an economic crash and raised interest rates which hit mortgage holders, said of the move: "If that suggestion is that they're going to intervene and keep prices down, that seems to me like a socialist measure.
"You're just going to try and suppress prices; you're giving away money. But then the question is, who's going to be taxed to pay for all of those giveaways?"
On the reasoning for the policy, the former Conservative Business Secretary told Tom Swarbrick: "I get Andy Burnham. He wants to be popular. Keir Starmer was very unpopular. And he feels that he's got to address people's concerns. But the answer can't be just, you know, taxing people and spending indefinitely.
"You've got to grow the economy."
On the left-ward turn of the Labour government, Mr Kwarteng was scathing, saying: "The idea that you can tax rich people in a kind of Robin Hood way and then redistribute it infinitely, it doesn't work.
In the end, the rich people just think, actually, why bother? If you're, if you're a rich person, you're being taxed 50% of your income. That's a massive disincentive.
"For every pound you earn, 50p goes to the government. And a lot of people just say, actually, do you know what? I'm gonna leave the country. And that's what happened in the '70s. And as far as I could see, Andy Burnham wants to return to the '70s."