Unfair to blame mini-budget for interest rate hike, Liz Truss says as she rules out being PM again

6 February 2023, 18:26 | Updated: 6 February 2023, 19:52

Liz Truss has embarked on a political comeback
Liz Truss has embarked on a political comeback. Picture: Getty/Spectator TV
Kieran Kelly

By Kieran Kelly

Liz Truss has said it is unfair to blame the mini-budget introduced by her government for the subsequent hike in mortgage and interest rates, and ruled out running for prime minister again.

Ms Truss stood down as prime minister after 44 days in charge due to intense political pressure following her government's mini-budget.

The budget included the biggest tax-cut in over seven decades, which Ms Truss and her team said would be funded by an economic boom.

Shortly after the mini-budget, the pound fell to its lowest-ever level against the dollar and gilt prices collapsed.

Meanwhile, government bond yield rose dramatically, forcing the Bank of England to intervene with a promise to buy up to £65bn government bonds. As a result, the interest rates charged to those with mortgages rose sharply.

However, Ms Truss said it would be unfair to blame the mini-budget for the rise in interest and market rates.

Liz Truss in an interview with Spectator TV
Liz Truss . Picture: Spectator TV

She told Spectator TV: "On the mortgage point I do want to address this – because we’ve been living in a very low interest rate world and mortgage rates have been going up.

"The reason there was a specific issue around the time we’re talking about in September, a lot of it is to do with the liability driven investments [LDIs] and the impact they had on the market.

"So I don’t think it’s fair to blame interest rises on what we did. I think that’s unfair."

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Ms Truss' interview with Spectator TV comes a day after she had an op-ed published in The Sunday Times, which also reflected on her time inside Number 10.

Despite her recent media appearances, Ms Truss confirmed that she does not want to run for prime minister again.

She said: "I definitely want to be part of promoting a pro-growth agenda. I definitely want to carry on as an MP.

"I’m positive about the future of Britain and I’m positive about the future of the Conservative party.

"I think we need to start building more of a strong intellectual base. But I’m not desperate to get back into Number 10, no."

Liz Truss stood down after 45 days in Number 10
Liz Truss stood down after 45 days in Number 10. Picture: Getty

She added that she would be "delighted" to allow for more people to make the case for "growth politics", but said there "aren't enough people making the case".

She added: "I believe that I’ve learnt a lot in my time in government, I understand what some of the pitfalls are, I’ve been through the mill on this and we do need to do things differently."

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