Rishi Sunak has defended his much-criticised spring statement, arguing that the UK is recovering from its biggest shock in 300 years and he is doing what he can.
The chancellor said he knows families are struggling with the rising cost of living and that is “why I announced a tax plan which delivers the biggest net cut in personal taxes in over a quarter of a century”.
Mr Sunak told Sky News: “I’m cutting fuel duty at 5p a litre, raising national insurance thresholds, giving 30 million workers a tax saving of £300 and cutting income tax for the first time.”
He added that people should “judge me by my actions”, including the measures he took during the pandemic.
Read more:As Sunak chooses to pocket £10bn, will he have to return in the autumn with more money?
Advertisement 1:27 Three measures from the spring statementChancellor criticised for not helping the poorest
After the spring statement yesterday, the chancellor has been accused of failing to help those who are out of work and on lower incomes.
More on Cost Of Living Related Topics: Cost of livingRishi SunakUK economyThe Office for Budget Responsibility, which provides the government with economic forecasts, said the rise in inflation is expected to cause “the biggest fall in living standards in any single financial year since ONS records began in 1956-57”.
The Resolution Foundation, a living standards think tank, warned the lack of support for low-income families in the spring statement leaves 1.3 million people – including 500,000 children – on the verge of “absolute poverty”.
The Institute for Fiscal Studies said “the biggest omission” from the spring statement was “anything for those subsisting on means-tested benefits”, who will be facing cost of living increases of about 10% “but their benefits will rise by just 3.1%”.
Its director, Paul Johnson, told a news conference: “His choice to increase national insurance rates and reduce the basic rate of income tax looks, to me at least, indefensible from an economic point of view – though one can see the political attractions.”
The ultimate aim is to encourage more people off benefits and into better-paying work.
Most of the newspapers on Thursday morning, even those that are normally supportive of the government, also criticised the lack of support.
Read more:Key points in Rishi Sunak’s spring statement
3:19 Analysis: Disposable incomes under strain‘Poorest are my priority’
Mr Sunak defended his position, saying: “I can’t solve every problem and I’ve always been honest about that and where I can make a difference, of course, I want to and I think the plan I announced yesterday will do exactly that and support hard-working British families.”
He added that those who are the least well off “actually are my priority” and they will benefit from a “more generous” Universal Credit system, tax cuts and a 6.6% increase in the national living wage from next month.
“I do believe the policies that we’re putting in place will help those people on low incomes disproportionately in fact,” he said.
Image: Mr Sunak said his priority is the poorest people‘High taxes are a reflection of the pandemic’
On the point that taxes are going to be at their highest level ever, Mr Sunak said: “That is a reflection of two things – first and foremost the fact we’ve experienced a pandemic, that was a pretty exceptional episode in our country’s history.
“Borrowing spiralled up to levels we haven’t seen since the Second World War, [it was the] biggest economic shock in over 300 years and we had to introduce interventions like furlough.
“I think most people would understand an exceptional experience like that probably does lead to an exceptional response and that’s what we’re now grappling with, the aftermath of COVID.
“But also, continue to invest in public services and that’s what people want us to do as well.”
Asked how those who are struggling to pay for food and heating, Mr Sunak referred to the 5p a litre cut on fuel he announced on Wednesday.
“When I go out and about talking to people, fuel duty is one of the things that is raised most often,” he added.