Tory leadership race: Sunak allies defend 'sensible' VAT cut amid U-turn accusations
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A senior supporter of Rishi Sunak has defended the former chancellor's pledge to scrap VAT on energy bills for a year if he becomes prime minister and insisted it is not a U-turn.
Grant Shapps, the Transport Secretary, said Mr Sunak had "always said he would keep a very close eye" on cost of living issues and adjust his approach when necessary.
Mr Shapps said the VAT cut "is consistent with what he has said all along which is he will always keep these things under review" and it is "perfectly sensible and a rational way to operate" to act when the situation changes.
Allies of Liz Truss accused Mr Sunak of performing a "screeching U-turn" on the issue and said the Foreign Secretary's Tory leadership rival had "spent the last few weeks... branding everyone else’s tax cuts immoral and fairytales".
Mr Sunak has promised to introduce the “temporary and targeted” VAT measure to save £160 on the average household bill as energy prices soar this winter.
Follow the latest updates below.
10:07 AM
Grant Shapps rules out joining rail strike talks
Grant Shapps will not at any stage intervene in negotiations between Network Rail, train operating companies and union bosses as he said calls for him to join the talks to secure a breakthrough are a "game by the unions".
There are fears the nation could face repeated strike action on the railways in the coming months but Mr Shapps today insisted it is not his job as Transport Secretary to resolve the dispute over pay, jobs and conditions.
Asked "no or yes" if he would intervene, he told Sky News: “It is a no. It is a game by the unions. It is a complete red herring as well, by the way, and it is simply not how strikes are resolved.
“It can only ever be the employer, in this case Network Rail, the train operating companies and the unions.”
10:00 AM
Grant Shapps: 'I’m a reasonable guy'
Grant Shapps, the Transport Secretary, has insisted he is a “reasonable guy” amid an ongoing row over union strike action.
Asked about his plans to restrict strikes, the Cabinet minister told the BBC: “I’m a reasonable guy and I think that people should have the right to withdraw their labour and strike.
“The question is one of proportionality. We have, in this country, a railway that still works, in many cases, on rules and regulations from the ’70s, the ’60s, the ’50s and in one case from 1919. That’s where the lack of Sunday working comes from. We simply have to modernise it.”
He added: “It is perfectly reasonable to withdraw your labour. You shouldn’t be able to ballot on one subject, as has happened here, and then widen the strike out to everything else, and then keep it going in a forever strike kind of fashion.”
09:40 AM
Pictured: Jeremy Corbyn joins RMT chief Mick Lynch on the picket line
09:29 AM
Team Truss insists Sunak VAT pledge is a U-turn
Team Truss is adamant that Rishi Sunak's pledge to slash VAT on fuel bills for one year if he becomes PM does represent a U-turn after the former chancellor previously criticised other Tory leadership candidates for promising tax cuts.
Kwasi Kwarteng, a leading supporter of Ms Truss, told Sky News: “It is a U-turn. Let’s not beat about the bush. This is a U-turn.”
He added: “It is a U-turn. If this isn’t a U-turn, I don’t know what is.”
Told that he appeared to be "having a pop" at Mr Sunak, Mr Kwarteng said: "I am not having a pop at him. I think he is a really capable person, I think he is a good colleague, he is very likeable.
“I am saying that his tax policy I think is wrong and I am very pleased that he shifted ground on that.”
09:16 AM
'Rishi Sunak has now come late to the party'
Rishi Sunak has come "late to the party" on tax cuts, Kwasi Kwarteng said this morning as he welcomed the former chancellor's apparent U-turn on pledging a VAT cut on fuel bills.
The supporter of Liz Truss was asked what government job he would like if she wins the Tory leadership contest and he told Sky News: “It is not a question of what job I would like. Liz I know very well. I think she has got a really good agenda in terms of tax cuts.
"Delighted to see that Rishi Sunak has now come late to the party and decided that tax cuts are a good idea and they are not a fairytale and that being a grown up does mean, because that is what he said… that does mean that you can have tax cuts.
“I am delighted to see that he has come round to that view.”
09:13 AM
Kwasi Kwarteng defends Truss plan to cut crime
Liz Truss last night unveiled a target to cut crime by 20 per cent in the next two and a half years if she becomes prime minister (you can read the full story here).
Kwasi Kwarteng, one of Ms Truss's supporters, said the cut would be achieved by asking the police to focus on the most serious crimes.
He said: “That is the target and she specified the crimes that she wants them to look at is to very much focus on serious crime which affects people very seriously every day and that is what she wants the focus on.
“Less on the perhaps the bureaucratic side, less on following what is going on on Twitter and that sort of thing, that is very much I think the focus.”
08:52 AM
'He has flip-flopped and U-turned'
After saying he is "very convinced" that Liz Truss would win the next general election if she becomes Tory leader, Kwasi Kwarteng was asked if that meant he believed Rishi Sunak would not be able to win the election.
The ally of Ms Truss told LBC Radio: "Well, I think I'd back Rishi, I think he is a very capable politician. He has flip-flopped and U-turned on this tax issue which I find somewhat concerning.
"But he is a capable politician and very likeable chap."
08:48 AM
Kwasi Kwarteng 'very convinced' Truss can win general election
Kwasi Kwarteng, a supporter of Liz Truss, said he is "very convinced" that the Foreign Secretary can lead the Tories to victory at the next general election.
Asked why he believes Ms Truss would win a general election, the Business Secretary said: "I think Liz has got a very wide appeal. She is a politician that many people don't know. She did extremely well in the debates earlier this week.
"Many people were looking at her for the first time and she just had a fresh, optimistic, dynamic approach, talking about wealth creation, talking about reducing people's tax burden, talking about investing in this country and I think it is a really exciting offer.
"I am pretty convinced, I am very convinced in fact that she will win a general election."
08:41 AM
'No one is cutting any deals or talking about jobs'
Kwasi Kwarteng has said he has not spoken to Liz Truss about potentially being her chancellor should she win the Tory leadership race and secure the keys to No 10.
The Businesses Secretary, who is an ally of Ms Truss, was asked if he could be the next chancellor and he told LBC Radio: "We haven't had any conversations. It is going to be a very keenly fought, balanced and difficult contest.
"I am very hopeful that Liz will make it. But no one is cutting any deals or talking about jobs now. We have got to just get over the line first."
08:37 AM
Kwasi Kwarteng criticises Rishi Sunak over VAT pledge
Kwasi Kwarteng, a leading supporter of Liz Truss, has criticised Rishi Sunak over his new pledge to temporarily cut VAT on energy bills if he becomes PM.
The Business Secretary said that Mr Sunak had opposed such a move until very recently.
He told LBC Radio: "She [Ms Truss] has been very clear that tax cuts are the way to re-energise our economy and also to incentivise people. He said that tax cuts were I think a fairytale, that was the word he used, he also said that, implied that he was the grown up because he was simply going to continue the status quo of increasing taxes.
"Belatedly I am very happy to see that he has changed his mind and that the VAT cut that he is proposing today was the very cut that he opposed when he was chancellor, only three weeks ago.
"We have got to remember that he was in office until about three weeks ago and he was two and a half years in that job where he didn't think it was right to cut VAT on energy bills, in fact earlier this year he was in the House of Commons... and he said that this was the wrong tax cut because it would disproportionately favour richer households."
08:31 AM
'The course we’re on will lead to low growth'
Business Secretary Kwasi Kwarteng said Liz Truss’s plans for a tax-cutting Budget and increased borrowing are designed to boost economic growth.
He told Times Radio: “We can’t keep burdening people with more taxes and expect them to be able to enjoy their lives and have a high standard of living.
“And I’m afraid that the course we’re on will lead to low growth, it will lead to stagnant wages and in the end, we could face a recession. And that’s not what we want to see.
“I think Liz has got a dynamic set of policies.
“We want to have low tax and a high-growth economy. At the moment, we have a high tax and a low-growth economy.”
08:28 AM
Truss ally claims Sunak is 'under a lot of pressure'
A senior ally of Liz Truss said Rishi Sunak’s apparent U-turn on cutting VAT on energy bills and his handling of the TV debates were a sign he is under pressure in the Tory leadership race.
Kwasi Kwarteng, the Business Secretary, told Times Radio: “I think he’s under a lot of pressure. That’s why we see all these statements: He was the person who said the VAT cut would disproportionately benefit rich families and now he’s saying that a VAT cut on energy bills is the right thing.
“He was saying that tax cuts were a fairytale, now he is proposing an unfunded tax cut. There comes a time in campaigns when people are under a lot of pressure, he clearly felt under a lot of pressure in the debate and he wanted to get out on the front foot and interrupt Liz.
“I think that was the wrong look for him, I think that was the wrong action, but I can understand why he did that.”
08:26 AM
'I am sure that the whips will be looking at this'
Anneliese Dodds, the chairman of the Labour Party, said she is sure that the party's whips will be "looking at" Sam Tarry's decision to join a rail strike picket line this morning (see the post below at 08.12).
She told Sky News: "That is obviously a decision for him. I personally will not be on a picket line because I am a politician and I believe what politicians should be doing now is what the Conservative Government has so appallingly failed to do but what the Welsh Labour government has done because there aren't strikes taking place in Wales today."
Pressed on what action could be taken against the shadow transport minister given that Sir Keir Starmer told his frontbenchers to stay away from picket lines, Ms Dodds said: "Ultimately, as I said, it is a decision for that individual but I am sure that the whips will be looking at this in terms of it being a disciplinary matter."
08:19 AM
'I have no doubt Sir Keir Starmer will want to sack him'
Grant Shapps said he has "no doubt" that Sir Keir Starmer "will want to sack" Sam Tarry from his role as shadow transport minister after he joined a rail strike picket line this morning (see the post below at 08.12).
The Transport Secretary told Sky News: “It is clearly in direct defiance of Sir Keir Starmer who has told his frontbench that they shouldn’t be so… no doubt he will want to remove him from his job.
“Nobody should be on the picket lines stopping hard working people who spend £600 per family, that works out to £160,000 per rail worker, preventing any of them from losing their jobs during the pandemic.
“We come out of the pandemic and this is the way that people are being thanked and if Labour frontbenchers want to go and join them on the picket line, well people will come to their own conclusions.
“I have no doubt Sir Keir Starmer will want to sack him.”
08:12 AM
Labour frontbencher defies Keir Starmer over rail strikes
A Labour frontbencher has defied instructions from Sir Keir Starmer not to join union picket lines during today's rail strikes.
Sir Keir Starmer said only yesterday that he did not want to see his frontbenchers on picket lines as he argued a government-in-waiting "doesn’t go on picket lines".
But Sam Tarry, a shadow transport minister, joined the industrial action at Euston station in London this morning and told ITV's Good Morning Britain programme that "if we don't make a stand today, people's lives could be lost".
Asked if he expected to be sacked by Sir Keir by lunchtime, Mr Tarry said: "I have no idea what Keir will decide to do but I know this, that if Keir was in government right now this dispute would not be happening."
'If we don't make a stand today, people's lives could be lost.'
Shadow Transport Minister Sam Tarry has joined the picket line as rail workers strike.
He explains why he joined the picket line after Sir Keir Starmer told GMB that Labour MPs should not take part. pic.twitter.com/PWwVWWeNNO— Good Morning Britain (@GMB) July 27, 2022
08:05 AM
'Perfectly sensible and a rational way to operate'
Grant Shapps has argued it is "perfectly sensible and a rational way to operate" to act when circumstances change as he defended Rishi Sunak's new pledge to temporarily scrap VAT on fuel bills if he becomes Tory leader.
The Transport Secretary, one of the former chancellor's most prominent supporters, told Sky News: “He already went out and spent £37 billion helping people, including about £1,200 for the most vulnerable families to help keep these bills down and said he would keep it under review.
“The fact that he has now reviewed it with the clarity of where energy bills are likely to be and the situation with the price cap for this October and said ‘yep, here is some further action’ I think that is perfectly sensible and a rational way to operate and it isn’t inflationary, of course it reduces bills for people in the shorter term and in the medium term it does nothing one way or the other to the consumer price index.
“So all in all it is a policy that stacks up and helps people pretty quick as well.”
08:02 AM
Sunak allies dismiss claims of tax cut U-turn
Rishi Sunak was last night accused of a “screeching U-turn” on tax cuts as he vowed to scrap VAT on energy bills for a year if he becomes PM (you can read the full story here)
Grant Shapps, the Transport Secretary and an ally of Mr Sunak, defended the move and insisted it does not represent a U-turn.
He told Sky News: “Well, first of all, I think it is probably worth saying he has done a huge amount already on energy and actually on the cost of living, some £37 billion actually and he always said he would keep a very close eye on this.
“We now know the position coming up to this autumn with regard to gas prices in particular and so he has said he can do something further on energy bills, this would be a one off, this would be removing the VAT on fuel for the one year which would be worth about £160.
“So I think it is consistent with what he has said all along which is he will always keep these things under review and that is what he has done by announcing this today.”
08:00 AM
Good morning
Good morning and welcome to today's politics live blog.
The Tory leadership race has shifted its focus back onto tax matters as Rishi Sunak faces pressure and accusations of a U-turn after pledging to scrap VAT on energy bills for one year if he wins the race for No 10.
Allies of Liz Truss believe Mr Sunak is feeling the heat in the contest, with the Foreign Secretary now increasingly viewed as the favourite to take over from Boris Johnson.
It promises to be another busy day in Westminster and I will be on hand to guide you through the key developments.
