“After the mini-budget, we were going at breakneck speed and I said we should slow down. She said, ‘Well, I’ve only got two years’ and I said, ‘You will have two months if you carry on like this’. And that’s I’m afraid what happened.”
That was former Chancellor of the Exchequer Kwasi Kwarteng speaking about his advice to disgraced ex-Prime Minister Liz Truss after their fiscal announcement in September upended financial markets.
In an interview with TalkTV, Kwarteng said that he warned Truss it was crazy to fire him, and she would only last “three or four weeks” if she did. “This is mad. Prime ministers don’t get rid of chancellors,” he recalled telling her.
“Little did I know it was only going to be six days,” Kwarteng added.
Liz Truss fired Kwarteng on Oct. 14, making him the fourth finance minister in four months. She resigned six days later on Oct. 20.
He also revealed he found out that he was going to be sacked via a journalist tweeting while he was en route to 10 Downing Street.
Kwarteng unveiled the now-infamously disastrous mini-budget on Sept. 23 comprising a variety of tax cuts, sinking the British pound to record lows, surging U.K. bond yields and necessitating Bank of England intervention. One UBS economist likened the Truss government at the time to a doomsday cult.
“I think the prime minister was very much of the view that we needed to move things fast. But I think it was too quick,” he said.
Yet both Truss and Kwarteng doubled down on their policies, despite negative market reaction. Kwarteng even said a few days after the announcement that more tax cuts were coming.
The weeks after the calamitous announcement caused Truss’s government to U-turn on a number of its tax-cutting policies to calm down the markets.
In the interview, he added that he took responsibility for what happened after the mini-budget and won’t “wash my hands” of it.
“I was Chancellor of the Exchequer. I was also part of the top team, but looking back, I think we could’ve have had a more measured approach.”
He praised Rishi Sunak as the U.K.’s new prime minster but added that new Chancellor Jeremy Hunt should not blame him for the government’s current problems.
“The only thing that they could possibly blame us for is the interest rates and interest rates have come down and the gilt rates have come down. I mean, it wasn’t that the national debt was created by Liz Truss’s 44 days in government.”