Rishi Sunak defends taking money from deprived urban areas as he faces latest hustings with Liz Truss – UK politics live

Rishi Sunak has defended his comments after a video, shared with The New Statesman magazine, shows him telling grassroots Tories in Kent that he had been working to divert funding from “deprived urban areas” towards prosperous towns.
The former chancellor said today that it is not solely “big urban areas that require that extra investment”. He told Sky News: “It’s right that those funding formulas are accurate, that they actually look at the need in different areas, measure that properly and reflect how things have changed from the past.

“And I think that’s an entirely sensible thing to be doing, because it’s not just big urban areas that require that extra investment.

“It’s also people in rural communities, it’s also people in towns and that’s what we’ve done, both as a Government in the past, what I want to do as prime minister in the future.

“Level up across the country so that no matter where people live, they feel incredible opportunities and pride in the place that they call home.”

The latest Conservative Party leadership hustings is taking place at 7pm in Eastbourne, you can follow all the action here.

Liz Truss has been accused by Labour of being “deeply irresponsible” for threatening to tinker with the Bank of England’s mandate on the brink of a recession.

The shadow chancellor, Rachel Reeves, attacked the Tory leadership frontrunner after Truss and her allies repeatedly questioned the performance of the Bank’s governor, Andrew Bailey, and said she would review the institution’s remit.

“This is deeply irresponsible from a Conservative leadership candidate. It creates huge uncertainty that will hold back vital investment in our economy,” Reeves said.

Rishi Sunak has defended his comments after a video, shared with The New Statesman magazine, shows him telling grassroots Tories in Kent that he had been working to divert funding from “deprived urban areas” towards prosperous towns.
The former chancellor said today that it is not solely “big urban areas that require that extra investment”. He told Sky News: “It’s right that those funding formulas are accurate, that they actually look at the need in different areas, measure that properly and reflect how things have changed from the past.

“And I think that’s an entirely sensible thing to be doing, because it’s not just big urban areas that require that extra investment.

“It’s also people in rural communities, it’s also people in towns and that’s what we’ve done, both as a Government in the past, what I want to do as prime minister in the future.

“Level up across the country so that no matter where people live, they feel incredible opportunities and pride in the place that they call home.”

Conservative former minister Philip Dunne believes Rishi Sunak is the candidate able to “attract people to come back to the Conservatives”.

The MP for Ludlow announced he is a Sunak supporter on BBC Radio 4’s PM programme, saying: “I have done a survey of my constituents. I’ve had 1,250 people respond and of the Conservative members about 250 replied, and they were 35% for Liz Truss and 33% for Rishi Sunak.

“But importantly, 32% undecided. So I think this is all to play for. I think that what we need for the next prime minister is somebody who is going to be able to unite the party and attract people to come back to the Conservatives, who we’ve lost in recent months.

“And I think that from the evidence of my survey, where it’s four and a half to one for those who didn’t vote Conservative in favour of Rishi Sunak, I’m going to support Rishi Sunak for prime minister.”

A majority of Britons believe Rishi Sunak would be the best candidate to end a recession, according to the latest YouGov poll.
When asked which of the leadership candidates would be best able to end a recession, 19% of respondents chose Sunak compared to 12% who said Liz Truss. However, almost half, 46%, said “neither”.

Councils across England have written to the health secretary, Steve Barclay, warning that social care reforms could push some local authorities “over the financial edge” and force others to cut back on “vital council services”, ITV News reports.

The Local Government Association (LGA) has written a letter to Barclay calling for key reforms – such as an £86,000 cap on the costs of care and a new means-tested system – to be delayed by six months to urgently ease pressure on councils.

The letter, written on behalf of the LGA by David Fothergill, leader of the Conservative group on Somerset Council, and with the backing of many other Tory council leaders, says:

The serious and precarious nature of our existing adult social care system, and the very real consequences of current pressures on people who draw on care and support, is unquestionable.

It adds that much of the immediate challenge “can be traced back to historic under-funding, which continues to this day on a significant level.”

The letter lists concerns about unpaid carers, providers closing down or handing back contracts, and reductions in quality and choice.

Fothergill writes:

Social care’s lack of capacity to deliver the care that people need has been evidenced time and time again and the government needs to step in.

If it doesn’t, we can expect one of the most challenging winters in recent times, with knock-on effects that will continue to impact on people and their loved ones.

According to ITV News, government sources said that while they wanted to work constructively with the sector, they did not accept any need to lengthen the timetable.

Managers employed by Network Rail have voted to accept a 4% pay offer in a move seized on by the government as a breakthrough in the wider rail strikes dispute.

The Transport Salaried Staffs’ Association (TSSA) confirmed its management-grade members had accepted the deal, which should ensure a skeleton service will continue to run during planned strikes in August.

The decision was announced the day after 2,500 other TSSA members at Network Rail confirmed they would take action alongside 40,000 Rail, Maritime and Transport workers’ union (RMT) members, including signallers and train operating staff, on Thursday 18 and Saturday 20 August.

The transport secretary, Grant Shapps, said it was “fantastic news”, adding:

This acceptance by these TSSA members will mean that we have a strong, reliable contingency staff for any future strikes and will be able to run services for passengers and minimise disruption to lives of everyday people.

Unions working with industry instead of against is the only way forward out of this dispute and a necessary step to end these destructive strikes and to put our railways on a secure footing for the future.

Read the full article here.

Keir Starmer is facing a leadership crisis over his decision to ban Labour frontbenchers from appearing on trade union picket lines, HuffPost UK is reporting.

The Labour leader is being urged to clarify his approach to frontbenchers attending picket lines, after an embarrassing standoff with Lisa Nandy, the shadow levelling up secretary, who was pictured chatting with striking CWU workers in her Wigan constituency on Monday.

Nandy’s team has said she informed Starmer’s office beforehand of her intention to attend the CWU picket in her constituency.

But one senior Labour MP told the news website:

She says she rang Sam White [Starmer’s chief of staff], who told her she could go to the picket line. The big question for him is why did he not say don’t do it?

A Labour source said:

Nobody forced Keir to choose this issue as the big test of his authority, but he did and his authority has been tested by junior frontbenchers and his opponent in the last leadership election and he is not doing anything about it.

His office was floundering in terms of its response. It was a total shit show.

Another MP said the issue has severely damaged Starmer’s authority and it was a “dangerous moment” for the Labour leader ahead of the party conference next month.

They added:

The whole thing is just a mess and I don’t see it being resolved. It will cast a very long shadow and has the potential to derail conference.

The UK business secretary, Kwasi Kwarteng, has admitted it will be more than a month before ministers can introduce any measures to tackle the rising cost of living.

Kwarteng, who is backing the foreign secretary, Liz Truss, to become the next leader of the Conservative party, said he was expecting a new prime minister to introduce a “support package” in an emergency budget but it could not happen until after they start work next month.

Both Boris Johnson and the chancellor, Nadhim Zahawi, are on holiday as the Bank of England warns the economy will enter the longest recession since the 2008 financial crisis. The UK is forecast to suffer an economic downturn lasting more than a year.

Kwarteng said: “I don’t know where Boris is,” but claimed the public would not begrudge the outgoing prime minister taking a honeymoon. He went on to say he was in “regular contact” with Johnson.

Read the full article here.

Tony Danker, the CBI director general, has said he fears a power vacuum amid the Tory leadership contest, warning that the economic crisis “cannot wait until 5 September for action”.

His comments came as both Boris Johnson and Nadhim Zahawi are both on holiday as the country braces for a looming economic crisis.

He told BBC Radio 4’s World at One:

I have no problem with people having short holidays. My fear is much more profound, which is that there will be a vacuum from now until 5 September. We need the current prime minister and the current chancellor to fill that vacuum. We need them to make decisions. We need them to make plans. We need them to reassure firms, markets and households that we are gripping this.

We cannot wait until 5 September for action. We cannot wait until 5 September for plans and we cannot wait until 5 September for reassurance.

He added:

I think they need to be developing these interventions that are going to help people with the cost of living in the autumn. They need to be signalling on 26 August when Ofgem signal what the price rise is going to be.

They need to be signalling that the government has a response and an answer. And they need to be setting out growth plans and growth intentions now.

Industry bosses have accused Liz Truss and Rishi Sunak of “cherrypicking” between inflation and growth.

Tony Danker, the director general of the Confederation of British Industry, said the Tory leadership candidates must tackle both.

He told BBC Radio 4’s World at One:

I think the candidates are having a debate about stagflation actually. Each candidate is sort of picking their worse evil to focus on first. But the trouble with stagflation is you don’t get to choose between tackling inflation or tackling recession, you have to tackle both.

So, that’s challenge number one to the candidates, to not pick which one of inflation or recession they care about more, but to come up with a plan that tackles both.

He added:

We need a genuine plan about growth, that when it comes to tax we need to talk about the whole tax regime, not cherrypicking the ones that are most totemic.

We also need to think way beyond tax, we need to think about regulation that’s pro-growth, we need to think about boosting growth markets, and above all, given where most people are in business today, is we need to think about a plan to tackle labour and skills shortages.

Lisa Nandy, the shadow secretary of state for levelling up, has written to Greg Clark, the levelling up secretary and Tunbridge Wells MP, about Rishi Sunak’s “scandalous” admission that he “funnelled public money away from deprived areas and gave it to affluent Tory shires”.

The Labour MP for Wigan called on Clark to “urgently investigate” what changes were made to funding and what justified them.

It’s scandalous that Rishi Sunak funnelled public money away from deprived areas and gave it to affluent Tory shires.

The Levelling Up Secretary needs to urgently investigate what changes were made to funding formulas and what justified the changes.

✍️ My letter to @GregClarkMP pic.twitter.com/wQHV7ESHPi

— Lisa Nandy (@lisanandy) August 5, 2022

Richard Holden, the Conservative MP for North West Durham, has defended Rishi Sunak over the Tunbridge Wells video in which he said that as chancellor he tried to divert funding from deprived urban areas (see also 10:59).

He told Sky News:

This is exactly the sort of policy that he’d be speaking about whether he’s in Tunbridge Wells or is in places like Consett and County Durham where I represent.

He added:

We can’t just see money constantly funnelled as it has been over the last few years into those same urban areas. thats why he tore up those green book plans … that’s why Ben Houchen [the Tees Valley mayor] has come out today and welcomed exactly what Rishi Sunak said.

He claimed that the “formulas that have been there to date” have “left behind” constituencies across the country.

Richard Holden MP defends Rishi Sunak after a video emerged of the Tory leadership candidate telling party members that he diverted funds from deprived areas to wealthier towns when he was Chancellorhttps://t.co/RcCUwmZJbZ

📺 Sky 501 and YouTube pic.twitter.com/LFQT0ZUs9U

— Sky News (@SkyNews) August 5, 2022

My colleagues Jessica Elgot and Heather Stewart have written a profile on Kwasi Kwarteng: the low-tax Tory frontrunner to be the next chancellor.

There are few ministers who clashed more with Rishi Sunak during his time in office than Kwasi Kwarteng, from windfall taxes to net zero. Now the business secretary is among those touted to have a turn in Number 11.

Kwarteng has been a longtime loyal supporter of Liz Truss, making discreet inquiries with MPs about support for her potential leadership bid for many months. That dedication and his relative seniority has placed him as a frontrunner alongside Thérèse Coffey, the work and pensions secretary, and Sajid Javid – who briefly held the job before.

But it is quickly becoming a poisoned chalice. The next chancellor has an in-tray which contains the worst outlook for the economy since the 2008 banking crash, a lengthy recession, eye-watering inflation and rising interest rates, potential mass defaults on energy bills and an NHS going into a winter crisis.

Sunak began his own political career with an entrenched small state ideology, which was steamrollered in his first weeks in the job by the pandemic and the need to introduce the unprecedented furlough scheme.

Kwarteng would enter the Treasury if appointed as a free marketeer and is likely to find his beliefs will face extraordinary challenges from the economic headwinds.

Read the full article here.

The Tory former cabinet minister Liam Fox was speaking earlier to Sky News where he said it was “a bit surprising that we’re not hearing more from the chancellor” following the Bank of England’s forecast.

Fox, who is supporting Rishi Sunak in the leadership race, said he believes a recession is “inevitable” despite Liz Truss suggesting that is not the case.

He added:

What Liz seems to be saying is, at a time when we are already spending 85 billion on debt interest, twice as much as we’re spending on defence during a conflict in Europe, we should be borrowing even more money.

That’s been tried before. If there was an easy way to get out of the inflationary problem and growth, don’t you think it would have been done here or the United States or in Europe?

He went on to say:

There is a global inflation element to deal with here. The question is how do we do that? My view is you deal with inflation first. Get control of borrowing. Then you take the measures to help grow the economy. And then you start to think about reducing taxes.

Conservative politicians have been responding to Rishi Sunak’s remarks that he had been working to divert funding from “deprived urban areas” towards more prosperous towns.

Foreign Office minister Zac Goldsmith said the leaked video was “one of the weirdest – and dumbest – things I’ve ever heard from a politician”.

This is one of the weirdest – and dumbest – things I’ve ever heard from a politician https://t.co/lxFzrHGeYY

— Zac Goldsmith (@ZacGoldsmith) August 5, 2022

Jake Berry, the chairman of the Northern Research Group of Tory MPs, said that in public Sunak “claims he wants to level up the North, but here, he boasts about trying to funnel vital investment away from deprived areas”.

In public @RishiSunak claims he wants to level up the North, but here, he boasts about trying to funnel vital investment away from deprived areas?

He says one thing and does another – from putting up taxes to trying to block funding for our armed forces and now levelling up… https://t.co/Hwwn9fWffe

— Jake Berry MP (@JakeBerry) August 5, 2022

But supporters of Sunak rallied around him, with Conservative Tees Valley mayor Ben Houchen arguing Boris Johnson led the party to electoral victory on a pledge to invest in areas “that have been ignored at the expense of urban cities”.

Strangely enough,most red wall areas that voted Conservative for the first time in 2019 -who have been left behind for decades -aren’t urban/city areas.Exactly the whole point of levelling up. Like the Green Book favouring London and Birmingham over Boro and tunbridge wells

— Ben Houchen (@BenHouchen) August 5, 2022

About The Author

Annalissa Cantot