Liz Truss has acknowledged she and her government lost the confidence of financial markets following the mini-budget of October 2022 – but has refused to apologise to homeowners for higher interest rates.
Talking to Sky News, the former prime minister blamed her downfall on the Bank of England, primarily governor Andrew Bailey. However, she said she did not meet Mr Bailey once during her time in office.
“I actually had a meeting set up – I wanted to meet him,” she said. “But I was advised that would be a bad idea. And perhaps I shouldn’t have taken that advice.
“But that advice came from the cabinet secretary and what I didn’t want to do is further exacerbate the [market] problems.
“In retrospect, yes, I probably should have spoken directly to the governor of the Bank of England at the time.”
Asked about the aftermath of the mini-budget, at which her chancellor Kwasi Kwarteng announced a series of unfunded tax cuts, without presenting evidence of how he would pay for them, Ms Truss said: “It’s fair to say that the government did not have the confidence of the markets…
“But if you have organisations within the state, like the Bank of England, like the Office of Budget Responsibility, who are pretty clear to people they don’t support the policies that are being pursued and are essentially undermining those policies, then it is difficult to command the confidence in the markets – because the markets look to the government for that leadership.”
During Ms Truss’s 44 days in office, the expected path for the Bank’s interest rate a year ahead rose from below 4% to around 6%.
While those rates were…
