Rishi Sunak attacks Liz Truss's economic credibility

Ex-chancellor criticises leadership opponent's plans, warning they would increase borrowing and fuel inflation

Rishi Sunak and Liz Truss have made it through to the final two in the Tory leadership race. PA

Conservative leadership candidate Rishi Sunak said he would not make promises he could not keep when it came to the cost-of-living crisis as he compared his approach to Margaret Thatcher's readiness to say things "that may have been difficult to hear, but were right for the country".

The former chancellor acknowledged Wednesday he is the underdog in the race to become the next prime minister but insisted it was important the public had the chance to debate the "very clear difference" between the two candidates' approaches.

Liz Truss defended herself against accusations her economic proposals were dangerous, saying she was challenging “Treasury orthodoxy”, during the latest hustings event as Mr Sunak used the event to say that millions of UK households could face “destitution” without further aid this winter.

The cost-of living-crisis dominated the latest debate as both candidates clashed at the latest leadership hustings at Birmingham’s National Exhibition Centre.

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“This whole language of ‘unfunded’ tax cuts implies the static model, the so-called abacus economics that the Treasury orthodoxy has promoted for years, but it hasn’t worked in our economy because what we have ended up with is high tax, high spending and low growth,” Ms Truss told the audience of Tory members.

“That is not a sustainable model for Britain’s future.”

Ms Truss sought to pitch her proposals as a new economic model before the hustings, claiming that “business as usual” could not go on.

Chancellor Nadhim Zahawi claimed that Ms Truss “understands the economics of growth” as he introduced the foreign secretary.

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Candidates Rishi Sunak and Liz Truss at the Conservative Party leadership election hustings at Wembley Arena, London. This was the final hustings attended by Tory Party members who will vote for the new leader and next prime minister. EPA

The Sunak campaign has attacked Ms Truss’s economic credibility in the final weeks of the race, after reports suggested she will not ask the independent Office for Budget Responsibility for a forecast before the measures she is planning for next month, if she becomes prime minister.

Conservative Treasury Select Committee chairman Mel Stride, who is backing Mr Sunak, has written to the chancellor and the Office for Budget Responsibility to ask whether work is being carried out to prepare for a potential emergency budget.

During the hustings, Ms Truss criticised the media for “constantly” making comparisons between her and former prime minister Margaret Thatcher, saying that the UK was in a “very different situation” from when the Iron Lady came to power in 1979.

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But her rival welcomed the support of Baroness Thatcher’s Cabinet ministers.

“I think unfunded tax cuts are wrong and do you know what?” said Mr Sunak.

“Her [Thatcher’s] chancellor Nigel Lawson agrees with me, the head of her policy unit agrees with me, Norman Lamont agrees with me.

“All of these people who understood Margaret Thatcher’s economics are supporting my economic plan because it is the right one for our country and it is a Conservative approach to managing the economy.”

Everything you need to know about Rishi Sunak — video

The former chancellor was earlier forced to fend off the suggestion that he should quit the contest to allow the next prime minister to take charge of the worsening economic situation as soon as possible.

He told broadcasters that tax cuts “may sound attractive at first, but if they risk stoking inflation and actually do nothing to help poorer people and pensioners, then they actually are going to be bad for everyone”.

“I don’t want to put fuel on the fire, I don’t think that is the right approach,” he added.

Mr Sunak also said that he would “fix” the energy market so that electricity companies would not be able to “charge us a very high price based on what’s going on in the natural gas markets”.

Outside the exhibition centre, about 40 protesters gathered at the hustings, chanting “Tory scum — out of Brum”, while party members queued to get in.

Updated: August 24, 2022, 5:14 PM