‘Bold rewiring' of economy needed as Tories seek to regain trust, Stride says

South Wales Argus

a day ago

In a speech on Thursday, Mel Stride is expected to promise the Conservatives will 'never again' make offers they cannot afford as the party seeks to forge a 'credible' financial plan for the future.
Taking aim at both Labour and Reform UK, the Tory frontbencher will accuse Chancellor Rachel Reeves of 'fiddling the figures' by changing her definition of national debt, and warn that 'populism is not the answer'.
Liz Truss's 2022 mini-budget spooked the markets and led to a spike in mortgage rates (Jacob King/PA)
Addressing the legacy of the 2022 mini-budget under Ms Truss's premiership, which spooked the financial markets and led to a spike in mortgage rates, Mr Stride will say: 'For a few weeks, we put at risk the very stability which Conservatives had always said must be carefully protected.
'The credibility of the UK's economic framework was undermined by spending billions on subsidising energy bills and tax cuts, with no proper plan for how this would be paid for.'
In a furious response, Ms Truss has accused Mr Stride of having 'kowtowed to the failed Treasury orthodoxy' and being 'set on undermining my plan for growth'.
The shadow chancellor will claim that the Tories acted swiftly to restore stability, but the party's credibility would take longer to recover.
'That will take time, and it also requires contrition,' he is expected to say. 'So let me be clear: never again will the Conservative Party undermine fiscal credibility by making promises we cannot afford.'
Ahead of the Chancellor's spending review next week, her opposite number will accuse her of 'abandoning' financial responsibility.
Ms Reeves has two self-imposed 'fiscal rules' – funding day-to-day spending through taxation and for debt, measured by the benchmark of 'public sector net financial liabilities' (PSNFL), to be falling as a share of GDP.
She has insisted these constraints are 'non-negotiable' amid wrangles with Cabinet colleagues over departmental budgets ahead of next week's announcement.
Chancellor Rachel Reeves has said her fiscal rules are 'non-negotiable' (Peter Byrne/PA)
Mr Stride will say: 'At the spending review next week, we can expect her to trumpet all of the additional projects and programmes she is funding – without mentioning the fact it is all being paid for from borrowing.'
Attacking Nigel Farage's Reform party after its gains in the local elections last month, the shadow chancellor will say: 'Take Reform. Their economic prescription is pure populism. It doubles down on the 'magic money tree' we thought had been banished with Jeremy Corbyn.'
During the speech in central London, he will say the two 'core priorities' for the party will be 'stability and fiscal responsibility', with control of spending and reform of welfare and public services.
He will add: 'And a bold rewiring of the British economy – to unleash growth, productivity, and opportunity across the country.'
Conservative leader Kemi Badenoch has said that the comeback she anticipates for the party will take time as it seeks to avoid 'rushing' into policy commitments.
Mr Stride will insist modern politics requires more 'thoughtfulness', with the Conservatives planning to spend the next four years forging a 'credible' plan to return to government.
'We will need to take our time if we are to forge a credible plan that delivers for the people of our country,' he will say.
'Over the next four years, our party will do just that.'
Since being ejected from Number 10 after just 49 days in office, Ms Truss has conceded her plan to quickly abolish the 45p top rate of tax went too far, but otherwise defended her failed bid to boost growth.
Responding to the Tory announcement on Thursday, she said: 'Mel Stride was one of the Conservative MPs who kowtowed to the failed Treasury orthodoxy and was set on undermining my Plan for Growth from the moment I beat his chosen candidate for the party leadership.
'Even when judged by the OBR's flawed calculations, my plans were chalked up as costing less than the spending spree Rishi Sunak pursued as Chancellor during the pandemic – yet Mel Stride never took him to task over any of that.
'And why has he singularly failed to examine the role played by the Bank of England in causing the LDI crisis that sent gilt rates spiralling? Why has he never asked the pertinent questions of the Governor, despite the Bank since admitting that two-thirds of the gilt spike was down to them?
'My plan to turbocharge the economy and get Britain growing again provided the only pathway for the Conservatives to avoid a catastrophic defeat at the election.'
She added: 'Until Mel Stride admits the economic failings of the last Conservative Government, the British public will not trust the party with the reins of power again.'
Reform's deputy leader Richard Tice said: 'We'll take no lectures on economics from a party that more than doubled the national debt, raised taxes and government spending to 70-year highs and shrank economic growth to 70-year lows.
'Meanwhile, we unearth Tory-run councils wasting £30 million on a bridge to nowhere. They can never be trusted again.'
The Liberal Democrats accused the Conservatives of attacking Mr Farage's party for 'the same fantasy economics' they had pursued 'while secretly plotting a pact with them' as they branded the speech 'absurd'.
Deputy leader Daisy Cooper MP said: 'It's insulting that the Conservatives think a few warm words will fool people into forgiving them for all the damage they did to the economy and people's livelihoods.
'Families are still reeling from the Conservatives' lockdown law-breaking and still paying the price after their mini budget sent mortgages spiralling.
'Now the Conservatives have the cheek to criticise Reform UK for the same fantasy economics while secretly plotting a pact with them: it's absurd.'