Rishi Sunak branded Liz Truss ‘Socialist’ for promising ‘something for nothing’ tax cuts tonight as the five surviving Tory leadership hopefuls faced off in another live TV debate.
The former chancellor also asked ‘which she regrets most’ out of backing Remain in the referendum and previously being a Liberal Democrat.
The assault came as the pair engaged in brutal clashes with Penny Mordaunt, Kemi Badenoch and Tom Tugendhat in the second televised showdown, hosted by ITV.
Ms Truss accused Mr Sunak of ‘business as usual’ economic management and ‘choking off growth’ by increasing the tax burden to the highest level in 70 years, insisting she had argued against the national insurance hike in Cabinet.
She accused the former chancellor of encouraging a recession by raising taxes, adding that his approach was ‘preventing companies from investing and it’s taking money out of people’s pockets’.
But Mr Sunak retorted that the country had been through a once-in-a-century pandemic and there was a ‘cost to these things’.
‘I’d love to stand here and say ”look, I’ll cut this tax, that tax and another tax and it will all be okay”. But you know what? It won’t,’ he said.
‘There’s a cost to these things and the cost of higher inflation, higher mortgage rates, eroded savings. And you know what? This something for nothing economics isn’t Conservative. It’s Socialism.’
He added that Ms Mordaunt was proposing to drop one of his fiscal rules against borrowing to fund day-to-day spending, saying ‘even Jeremy Corbyn didn’t suggest that we should go that far’. ‘If we are not for sound money what is the point of the Conservative party?’ he said.
When Mr Sunak goaded her over voting Remain and being a Lib Dem in the past, Ms Truss admitted she had been ‘on a political journey’ and had a dig at his privileged public school education. ‘The reason I am a Conservative is that I saw kids at my school being let down in Leeds – perhaps not getting the opportunities you had at your school, Rishi.’
All five contenders were asked by host Julie Etchingham to raise their hands if they wanted Boris Johnson to serve in their government. None did – although Ms Mordaunt did interject that Mr Johnson ‘got Brexit done’.
Trade minister Ms Mordaunt also slapped back at ‘smears’ about her views on trans rights, denying that she had tried to rewrite history about supporting self-identification with medical assessment. She said she ‘knows why this is being done’ but any attempt to paint her as ‘out of touch’ will ‘fail’.
With one more candidate set to be eliminated in the next instalment of voting by MPs tomorrow, Mr Sunak looks set to make the run off ballot by Tory members, having topped the previous rounds.
However, there is a huge struggle for the other spot in the final contest.
In other developments in the tumultuous Tory civil war tonight:
- Mr Sunak insisted he had never had non-dom tax status but pointed out his billionaire heiress wife was from India, and said he was ‘incredibly proud’ that his father-in-law had ‘built’ a highly successful business from nothing;
- Ms Truss took a backhanded swipe at Mr Sunak’s style, saying she is ‘not the slickest presenter on this stage… I’ve shown I can deliver as Foreign Secretary’;
- All the hopefuls dismissed the idea of a snap general election when the new PM takes over, saying the focus should be on addressing the cost of living;
- The would-be PMs were asked to put up their hands if they backed Brexit at the referendum, with Ms Truss unable to say she did;
- Mr Tugendhat said all the other candidates were tainted by having served in Boris Johnson’s government;
- Mr Sunak issued a campaign video directly trolling Ms Truss for backing Remain in 2016, and describing him as a ‘real Brexiteer from day one’;
- Ms Mordaunt used a BBC interview to vent fury at ‘smears’ and ‘toxic politics’ as she struggles to stop her PM bid being derailed by a backlash at her trans rights stance.
Liz Truss (right) accused Rishi Sunak (left) of ‘business as usual’ economic management and ‘choking off growth’ by increasing the tax burden to the highest level in 70 years, insisting she had argued against the national insurance hike in Cabinet
Rishi Sunak, Liz Truss, Kemi Badenoch, Tom Tugendhat and Penny Mordaunt (pictured left to right) are clashing in the second televised Tory leader showdown, being hosted by ITV
Mr Sunak asked Ms Truss ‘which she regrets most’ out of backing Remain in the referendum and previously being a Liberal Democrat
A video posted on Twitter before the debate said Mr Sunak campaigned ‘relentlessly’ for Brexit – and displays a image of Ms Truss out banging the drum for Remain
HOW THE TORY LEADERSHIP RACE WILL BE FOUGHT
Tonight: ITV hosted the second televised debate between leadership candidates.
Tomorrow – A third ballot of Tory MPs will be held which will see the candidate with the lowest number of votes eliminated.
Tuesday – More ballots will be held for the rest of the week until the list of contenders is whittled down to a final two.
Tuesday night – Sky News hosts the third and final leadership debate.
21st July – MPs will head away from Westminster for their summer break, meaning this is the deadline for a final pairing to be decided in the parliamentary stage of the leadership election.
Late July and August – CCHQ will assume responsibility for leadership election and will send out ballot papers to around 200,000 Conservative Party members. The Tory grassroots will be asked to decide between the final two candidates, with hustings events to be held across the UK.
5th September – The result of the membership ballot is announced, with the candidate receiving more than 50 per cent of the vote being declared the new Tory leader and Boris Johnson’s replacement as Prime Minister.
6th September – The new Tory leader is likely to be formally appointed as PM during a visit to the Queen at Buckingham Palace.
7th September – The new PM is set to be quizzed in the House of Commons in their first ever Prime Minister’s Questions.
In brutal opening clashes on tax, Ms Truss said Britain is predicted to experience a recession due to Mr Sunak’s policies.
‘Rishi, you have raised taxes to the highest level in 70 years. That is not going to drive economic growth,’ she said.
‘You raised national insurance, even though people like me opposed it in Cabinet at the time because we could have afforded to fund the NHS through general taxation.
‘The fact is that raising taxes at this moment will choke off economic growth; it will prevent us getting the revenue we need to pay off the debt.’
Ms Mordaunt also waded in to say she disagreed with Mr Sunak, adding: ‘I think the tax cuts I’ve outlined are not inflationary.
‘I think people listening at home will be looking at us, debating these issues. And it seems that we’re removed from the real problems that they are facing, they need some immediate action now, I don’t understand why Rishi doesn’t accept that.
‘But I also think there’s things we can do that don’t cost any money, making things work better for people. That’s why I’ve introduced the childcare policy that I have.
‘Making tax simpler so that it reduces the costs that businesses are having to pay just to be tax compliant. There’s many things we can do.’
Ms Badenoch said the candidates needed to be ‘honest’ with the public about the nation’s economic future.
She added: ‘I think what we’re seeing in the discussion that’s taking place is that there are no easy options. There are no solutions, only trade-offs. When I was working in the Treasury, it was always a choice between difficult option A, terrible option B or mad option C.
‘We need to be honest with the public about how difficult things are. The Government can’t solve everything and we need to do better at it in terms of the way that we fix things.’
Responding to Ms Mordaunt’s point, Mr Sunak said he ‘does take the situation seriously’.
He added: ‘I heard Penny on the TV this morning saying you were going to scrap one of my rules that the Government shouldn’t borrow for day-to-day spending.
‘Now look, it’s one thing to borrow for long-term investment, but it’s a whole other thing to put the day-to-day bills on the country’s credit card and we know how that ends. It’s not just wrong, it’s dangerous. And you know what, even Jeremy Corbyn didn’t suggest that we should go that far.’
Ms Truss tackled head-on concerns that she can come across as wooden.
She said: ‘I’m somebody who says what I think, I’m honest, I was brought up in Yorkshire – I say what I mean and I mean what I say.
‘I’m somebody that, when I promise to deliver something, I do deliver it.’
In a swipe at Mr Sunak, she said that was ‘one of the reasons I was so concerned about us breaking our manifesto on national insurance, because we committed to the British public that we would do it’ – the Tories had promised in 2019 not to increase the tax.
She added: ‘I might not be the slickest presenter on this stage, but I think my colleagues understand in Parliament when I work with them that when I say I’ll do something, I do it.’
Ms Truss challenged Rishi Sunak on whether he still believed the UK should do more business with China despite human rights abuses in places like Hong Kong.
Mr Sunak told her at the ITV debate: ‘I actually support the view of the Integrated Review, the plan that you and I both sat around the Cabinet table and helped draft, which highlighted that China was an enormous threat to our national security, and that’s the lens in which we should view it.’
Mr Sunak said the Government was taking the ‘powers and the protections’ needed to safeguard the country from ‘hostile investment’.
He defended his wife Akshata’s previous non-domiciled tax status and her family’s wealth during the ITV debate.
The contenders’ key quotes in a bitter Tory leader debate
On tax cuts:
This something for nothing economics isn’t Conservative. It’s Socialism…
‘If we are not for sound money what is the point of the Conservative party?’ he said.
On the tax burden:
‘It is cutting back on growth. It is preventing companies from investing and it’s taking money out of people’s pockets. That is no way to get the economy going during a recession.’
On cost-of-living crisis:
‘I think people listening at home will be looking at us, debating these issues. And it seems that we’re removed from the real problems that they are facing, they need some immediate action now, I don’t understand why Rishi doesn’t accept that.’
On ministers being tainted by Boris Johnson:
‘Whatever your responsibility was in that government, whatever your place in that government was, Keir Starmer in two years’ time is going to hold that record against us.’
Slapping down Tugendhat:
‘Serving in Government is not easy. It requires taking difficult decisions. Tom has never done that. It’s very easy for him to criticise what we’ve been doing, but we have been out there on the frontline making the case.’
He said he is ‘really proud’ of how his billionaire father-in-law NR Narayana Murthy, who launched IT services company Infosys, made his fortune.
Mr Sunak said: ‘So I’ve always been a completely normal UK taxpayer, my wife is from another country so she’s treated differently, but she explained that in the spring and she resolved that issue, but there is commentary about my wife’s family’s wealth.
‘So let me just address that head on, because I’m actually incredibly proud of what my parents-in-law built.
‘My father-in-law came from absolutely nothing, just had a dream and a couple of hundreds pounds that my mother-in-law’s savings provided him, and with that he went on to build one of the world’s largest, most respected, most successful companies that by the way employs thousands of people here in the United Kingdom.
‘It’s an incredibly Conservative story, actually it’s a story I’m really proud of and as prime minister I want to ensure that we can create more stories like theirs here at home.’
Ms Badenoch reiterated that she had been responsible for reversing the trans policy put in place by Ms Mordaunt as equalities minister.
‘I’m saying that when I took on the role of equalities minister, we had to change the existing Government policy which previous ministers had put in place,’ Ms Badenoch said.
‘What I’m challenging or what I challenged Penny on is what that policy was. She is saying she did not agree with it, but I don’t understand how that would be the case if she had been the previous minister. If she didn’t agree with it, why was the policy as it was?’
Ms Mordaunt replied: ‘I wasn’t the previous minister. The stuff in the papers today demonstrates what my policy was and refutes this. I think this whole thing is unedifying, and I would just say to all four of my other colleagues and candidates here, I know why this is being done.
‘But what I would say to you is that all attempts to paint me as an out-of-touch individual will fail. I’m the only person on this stage that has won and fought a Labour seat. My constituents do not elect people who are out of touch.’
Ms Badenoch responded: ‘Penny I was just telling the truth. I’m telling the truth.’
Foreign Affairs committee chair Mr Tugendhat talked up his ‘clean start’ offer, saying those who served in Mr Johnson’s government ‘lent credibility to the chaos’.
He said: ‘Whatever your responsibility was in that government, whatever your place in that government was, Keir Starmer in two years’ time is going to hold that record against us.
‘We need to make sure we’re winning Conservative seats across the country, and even really good people lend credibility to the chaos candidate.’
But Ms Badenoch responded that she was ‘not ashamed of anything we did’ while she was a minister.
‘We have a lot to be proud of. We got Brexit done, and what the Prime Minister did on Ukraine and on vaccines was fantastic,’ she said.
‘Serving in Government is not easy. It requires taking difficult decisions. Tom has never done that. It’s very easy for him to criticise what we’ve been doing, but we have been out there on the frontline making the case.’
Mr Tugendhat pointed out he had been on the frontline in Afghanistan, Iraq and ‘in the argument against Putin and China.’
However, Ms Badenoch responded: ‘You haven’t taken any decisions, talking is easy.’
All the candidates backed the target to reach Net Zero by 2050 apart from Ms Badenoch – who said she would change elements that ‘make life difficult’ for ordinary people.
Ms Mordaunt was installed as the surprise front runner, but her campaign appears to be struggling now
Ms Badenoch (left) and Mr Tugendhat (centre) clashed over his claim that ministers under Boris Johnson were tainted
Mr Sunak proudly raised his hand when the candidates were asked whether they backed Brexit in 2016
She said the 2050 target was for a time when none of them would be in office ‘to be accountable for it’.
‘If there are things in the plan that will bankrupt this country, I will change them, if there are things in the plan that will make life difficult for ordinary people, I will change them,’ she said. ‘I do believe in climate change, but we have to do it in a way that is sustainable.’
Ms Truss said she backed the target, but ‘we need to deliver it in a way that doesn’t harm people and businesses’, highlighting her plan for a moratorium on the green levy on energy bills.
Ms Sunak backed the target, saying it was about the inheritance left to children and grandchildren. ‘But we need to bring people with us and if we go too hard and too fast then we will lose people and that’s no way to get there,’ he said.
Earlier, Mr Sunak trolled Ms Truss for backing Remain in 2016, describing how he defied warnings that his career would be over to support Brexit, and pledging that as PM he would scrap or overhaul all legacy EU laws.
A video posted on Twitter said Mr Sunak campaigned ‘relentlessly’ to cut ties with Brussels – and displayed an image of Ms Truss out banging the drum for keeping ties.
The old-fashioned style black-and-white ended with the voiceover pointedly tagging Mr Sunak as ‘a real Brexiteer from day one’.
Meanwhile, Ms Mordaunt vented fury in an interview at ‘smears’ and ‘toxic politics’ as she struggles to stop her PM bid being derailed by a backlash at her trans rights stance.
The intervention came as a ConservativeHome survey suggested Ms Mordaunt has dramatically lost ground in the race. Shock results last week found she would defeat all comers in a head-to-head ballot of Tory members – but it now appears she would be defeated by both Rishi Sunak and Liz Truss.
Ms Truss has been appealing for right-wingers to unite behind her – and Kemi Badenoch has also been putting in a strong showing.
Although foreign affairs committee chair Tom Tugendhat seems to have the least backing from MPs in the remaining field, he was seen as performing well in the first debate on Friday night.
Speaking on the BBC’s Sunday Morning programme, Ms Mordaunt denied reports that she had pushed through a policy to end the requirement for trans people to obtain a medical diagnosis of gender dysphoria before they could legally change gender when she was equalities minister in Theresa May’s government.
‘This has been rebutted many times. We all know what is going on. This is the type of toxic politics people want to get away from,’ she said.
‘We did a consultation. We asked healthcare professionals what they thought about the situation. That is the section I looked after. I managed that consultation. We didn’t actually on my shift produce a policy.
‘There is a number of smears going on in the papers. My colleagues are very angry and upset that this is how the leadership contest is being dragged down.’
Former Cabinet minister Iain Duncan Smith, who is backing Ms Truss, turned up the heat on Ms Mordaunt by saying he did not know what her ‘big achievements are’.
‘Liz Truss is open, Rishi Sunak is open, Kemi is open but the one person that I personally don’t know what her big achievements are is Penny,’ he told Sky News’ Sophy Ridge on Sunday.
‘I don’t have any problem with her but for me, the key thing is we are not electing a leader of the Conservative party that has two years to build their reputation, we are electing someone who will be Prime Minister on day one so you need to know, when they have power and authority in government, what will they do with it?
‘I know what the others have done so I want to know what does she believe her big achievements are and where was she actually fighting for things, how many hours did she spend working at this, where did she face those tough decisions?’
He also attacked Ms Sunak for fuelling rampant inflation by failing to stop the Bank of England pushing on with quantitative easing – effectively printing more money.
Penny Mordaunt angrily denied claims she wanted to bring in gender self-identification as she took to the airwaves ahead of the latest TV debate tonight
‘So, first of all, over a year ago – and this is important – the Bank actually kept on printing huge sums of money which has inflated the economy… ‘ he said.
‘It was the Treasury that signed off on that money printing, the Chancellor no less, and so before they say ‘Oh it’s independent’, the Treasury has the right to say no to the money printing bit but they didn’t and that has fuelled inflation, so inflation is now domestically a problem we have to deal with.’
In a fresh pitch to win over Brexiteers, Mr Sunak has promised to scrap hundreds of remaining EU laws and regulations if he wins the keys to No10.
He would appoint a Brexit minister to go through the 2,400 EU laws still on the statute book, and recommend which should be scrapped or overhauled within 100 days of Mr Sunak entering No 10.
In an article for the Sunday Telegraph, Mr Sunak stressed that he had always backed Brexit even though he had been warned it could damage his political career.
‘I was advised by people I respected not just that leaving the EU was a bad idea for Britain; they also warned me that backing Brexit would mean the end of my political career,’ Mr Sunak said.
‘I listened to the advice, took it seriously, and weighed my decision carefully. But none of it altered my conviction that Britain would be better of f outside the EU, unshackled from its low-growth, bureaucratic mindset.’
Blow for Rishi as TWO-THIRDS of Britons say rich politicians can’t understand the struggles of ordinary people
Rishi Sunak suffered a blow today as a poll found over two-thirds of Britons believe ultra-wealthy politicians cannot identify with normal people’s struggles
Rishi Sunak suffered a blow today as a poll found over two-thirds of Britons believe ultra-wealthy politicians cannot identify with normal people’s struggles.
The former Chancellor – reputed to be the richest MP in the Commons with a billionaire heiress wife – is also rated as the most out of touch of the candidates to take over from Boris Johnson.
The findings, in exclusive research for MailOnline, came as the five remaining Tory leader hopefuls do battle for the top job – with crunch votes by MPs this week.
In a worrying sign for the Conservatives, the Redfield & Wilton Strategies survey suggests that the public want the new PM to call a snap general election – by 60 per cent to 24 per cent.
Mr Sunak said: ‘We need to capitalise on these opportunities by ditching the mass of unnecessary regulations and low-growth mentality we’ve inherited from the EU.
‘I have a plan, if elected prime minister, to have scrapped or reformed, by the time of the next election, all the EU law, red tape, and bureaucracy still on our statute book that is holding back our economy.
‘As prime minister, I would go further and faster in using the freedoms Brexit has given us to cut the mass of EU regulations and bureaucracy holding back our growth.
‘If we do this, we can get our economy growing quickly again and become the most prosperous country in Europe.’
The review would include an overhaul of the remaining EU financial services regulations with a view to triggering a ‘Big Bang 2.0’ for the City to enable it to maintain its status as a leading world financial centre.
Mr Sunak also indicated that he would overhaul EU General Data Protection Regulation (GDPR) rules and speed up the clinical trials by cutting EU red tape.
Deputy PM Dominic Raab went into bat for Mr Sunak this morning, insisting Tory leadership candidates calling for tax cuts need to explain how they would be paid for.
Mr Raab told Sky News: ‘You can’t borrow your way out of an inflation crisis.
‘If people are suggesting we should make cuts to the NHS at a time not just of Covid, but all the other non-Covid NHS challenges, they have got to spell out where they are coming from.
‘We want to all leave people with more money in their pocket. But if you cut taxes and inflation robs people of that money because it is worthless or sees interest rates go up so their mortgage is more expensive, then frankly it is a false economy.’
Asked about comments by Liz Truss, who said that current policies had led to years of low growth, Mr Raab said: ‘Liz can answer for her policies and her record.
‘She was chief secretary in the Treasury. People can see whether spending and the head count in the Civil Service went up or down. That’s for them to work out.’
Appearing on the BBC, Mr Tugendhat repeated his argument that the party needs a ‘clean start’ after three years of Boris Johnson.
He said it was clear that the Prime Minister’s account of Partygate was ‘rather more fictional than reality’.
‘What we need to see is a clean start. That is the most essential issue. In two years’ time we are going to be facing Keir Starmer in a general election,’ he said.
‘We need to make sure that all the attack lines that have been used against us in the last three years don’t come back in a general election.
‘We need to make sure absolutely that what we are able to deliver is championing Conservative policies and deliver a Conservative vision for the future.’
Mr Tugendhat dodged on whether he would serve under Mr Sunak, who also received a fine for breaching lockdown laws.
The latest ConservativeHome poll shows Ms Badenoch on 31 per cent – with Ms Truss, Ms Mordaunt and Mr Sunak bunched together on around 20 per cent. Although the survey is not scientific it is closely watched by MPs and ministers.
Mr Sunak topped the first two rounds of voting by MPs, although he still remains short of the 120 votes needed to guarantee him a place in the final run-off ballot.
In an interview with the Sunday Telegraph, Ms Truss said she would seek to abolish ‘Stalinist’ housing targets – unpopular with some Tory MPs – if she was elected.
‘I want to abolish the top down Whitehall inspired Stalinist housing targets. I think that’s the wrong way to generate economic growth,’ she said.
‘The best way to generate economic growth is bottom up by creating those incentives for investment through the tax system, simplifying regulations.’
A poll for MailOnline found that the public believes the new PM should call a snap general election