“THE TRUTH is that senior ministers, senior officials, senior advisers like me fell disastrously short of the standards that the public has a right to expect of its Government in a crisis like this.
“When the public needed us most, the Government failed.
“I would like to say to all the families of those who died unnecessarily how sorry I am for themistakes that were made and for my own mistakes at that.”
Dominic Cummings’ opening statement to the Covid-19: Lessons Learned Committee of the House of Commons is an attention-grabbing one.
The rest of his evidence was no less damning of Westminster’s response in the early days of the pandemic.
It revealed a government in which discussions at Cobra meetings, supposedly the most secure and confidential of briefings, were routinely leaked to the media. It showed a PM who went away on holiday as the crisis broke. The Government failed to follow the logic of the science presented to it and took weeks to understand the pandemic’s capacity to overwhelm the NHS.
And – as Mr Cummings said – ‘unbelievably’ we have a government whose response to the crisis at a critical time was put on the back burner to deal with a complaint by the PM’s fiancé about a disobliging story about her dog.
CUMMINGS HAS PAPER TRAIL
Suppose Mr Cummings, like so many others, made his assertion without a paper trail. In that case, his remarks could be interpreted as so much self-serving nonsense and a study in revenge. However, he has the paperwork, the email trail, the journal entries, the secret WhatsApp chats to back up his account.
His story got extra heft by his clear expression of regret that he had not obtained an independent view of the Government’s data earlier. When he did deliver data to those outside Downing Street, the extent of the crisis became apparent.
He made it clear the Government could have got better insight sooner and taken steps towards lockdown six weeks before it did.
The Prime Minister maintained ‘this new swine-flu thing’ was less of a risk than economic damage from overreaction throughout February, even as infections and deaths escalated.
However, the data was wrong. According to Mr Cummings, had the models been checked against live data from Intensive Care Units concerning Covid infections, it would’ve been evident the models presented to the Government and upon which it based its decisions were totally flawed.
In a withering assessment, Dominic Cummings said the more people criticised the plan, or lack of one, the more people on the inside believed their critics lacked knowledge.
If there’d been proper scrutiny and interrogation of what Ministers were being told, “we would have figured out at least six weeks earlier that there was an alternative plan”.
The original plan, he said, was “complete garbage”.
More than that, the Department of Health’s ‘plan’ amounted to no more than a press release.
The Department of Health was ’a smoking ruin’, he claimed. There was no plan for shielding, support, emergency procurement. The Department of Health failed to appreciate the size of the crisis and stuck to its normal procurement channels until it was almost out of PPE. The Department of Health refused to buy ventilators because their price had risen.
He suggested a proposal – seriously advanced for consideration – that people hold the equivalent of ‘chickenpox parties’ was met with disbelief by scientists who had to point out that chickenpox was not killing hundreds of thousand people worldwide.
HANCOCK BRANDED A LIAR
Dominic Cummings turned personal fire onto Matt Hancock, who remains the Secretary of State for Health.
He accused Mr Hancock of lying and that the Health Secretary’s conduct merited his instant dismissal.
He had earlier mentioned the Health Secretary’s denial that the Government pursued a herd immunity policy that formed a vital element of the Government’s then-approach.
Dominic Cummings said Matt Hancock “for lying to everybody in multiple occasions in meeting after meeting in the cabinet room and publicly”.
Crucially, Mr Cummings said the Cabinet Secretary (Mark Sedwill, the UK’s most senior civil servant) told him and the Prime Minister that he did not trust Matt Hancock to be truthful. He had notes of the meeting in which that remark was made.
Mark Sedwill, Mr Cummings claimed, told Boris Johnson that the cabinet system was not set up to deal with a minister like Matt Hancock, who – he alleged Mr Sedwill said – repeatedly lied in meetings.
He alleged Mr Hancock deliberately delayed implementing a proper track and trace system to meet an arbitrary testing target.
JOHNSON DUCKS THE QUESTIONS
As the Committee took a break, Prime Minister’s Questions opened in the House of Commons.
Asked about Dominic Cummings’ evidence, the Prime Minister failed to deny key allegations from it when asked by opposition leader Kier Starmer.
Instead, Boris Johnson deflected the questions by referring to a public inquiry. Mr Johnson refused to give a date for that inquiry’s start.
Mr Johnson seemed to decide poking the hornets’ nest would invite further disclosures from Mr Cummings, more damning than the testimony already given.
The picture Mr Cummings painted was chaos at the heart of Government, institutional complacency, lack of expertise in the key departments, and – tellingly – a Prime Minister and Cabinet with only a tenuous grasp on the urgency of the situation.
Given a chance to plan for different scenarios and allocate adequate resources, the Prime Minister and other key ministers preferred to look on the sunny side, hope for the best, and expect something to turn up.
The PM took his opportunity to have a holiday.
Nothing Mr Cummings said was more telling than his revelation that the reason the UK did not enter lockdown sooner was the Government – including the civil service – did not have a plan. The part of the civil service supposed to deal with civil emergencies couldn’t cope because it lacked expertise in the response it was supposed to handle. Planning was always based on a peak of the virus twelve weeks in the future from the date of any meeting.
The pandemic’s first wave peaked in late April. The Government, as late as March 14, planned for a peak in June.
JOHNSON LIKE THE MAYOR IN JAWS
Mr Cummings’ account of a shielding plan drawn up over two all-night brainstorming sessions after the lockdown’s announcement was hair-raising. At the eleventh hour it emerged the UK hadn’t taken account of vulnerable groups’ protection.
As the pandemic raged and demands made to put a brake on overseas travel, Dominic Cummings claimed the PM didn’t want one. He painted a picture of a media-obsessed Boris Johnson swayed by press campaigns against taking preventative action.
Mr Cummings explained Mr Johnson’s behaviour was like the Mayor’s in Jaws. He wanted to keep the beach open, even as the shark ate the swimmers.
On a broader topic, Dominic Cummings criticised a ‘crackers’ political system that allowed people like him and Boris Johnson to exercise such power during an emergency when they were unqualified to deal with one.
Mr Cummings’ tarter observations about the ability of the UK’s political parties included a stinging attack on how political parties select and support their leaders.
To summarise his view: he suggested the problem with the political system in this country is that voters had a choice between people like Jeremy Corbyn and Boris Johnson at the last election.
He concluded from that statement that the parties need to look at themselves to find out why they put ‘that sort of person’ forward for office.
That’s an issue beyond the current inquiry’s scope. ‘Teflon Al Johnson’ will be very grateful it is after Wednesday’s hearing.
Jeremy Hunt sets new direction for government as Truss’s credibility trashed by u-turn
ON MONDAY, Jeremy Hunt unpicked virtually every element of Kwasi Kwarteng’s mini-budget to calm financial markets and restore order to chaos.
The new Chancellor’s statement was a sobering reminder that although Prime Ministers serve with their colleagues’ consent, governments cannot survive without market confidence.
Mr Hunt said every Government’s core responsibility was to deliver economic stability.
“No government can control the markets. But every Government can give certainty about the sustainability of the public finances.”
His words were a damning implied indictment of the PM’s economic policy.
FULL REVERSE GEAR
The Chancellor’s words had an immediate effect on markets: the pound strengthened, and UK government bond yields fell to reduce the cost of government borrowing.
The statement might reduce the amount of a projected mortgage interest rise in November.
But make no mistake: the statement is a humiliation for the PM.
Every policy she’s trailed, trumpeted, and brought in has been chucked on the bin fire of her Government’s reputation.
Liz Truss sacked Mr Kwarteng because she did as she said and pursued a policy she endorsed enthusiastically.
The PM’s campaign slogan was “Trusted to Deliver”.
Her detractors pointed out that Liz Truss was pushed by the political winds and could not set her own course.
She’s tried setting her course and crashed the economy into an iceberg.
Moreover, her Cabinet colleagues must wonder whether they can trust the PM to stand behind them when they pursue a government policy she supports.
This is a government living hour-to-hour, in office but not in power, and with its key policies made by financial markets instead of ministers.
GOVERNMENT AIMS TO “REGAIN TRUST”
The Chancellor’s statement pulled no punches about the size of Ms Truss’s and Mr Kwarteng’s miscalculation and overconfidence.
Mr Hunt said: “The government is prepared to act decisively and at scale to regain the country’s confidence and trust.”
The painful use of the word “regain” underlines what the Government lost after September 23.
The Chancellor stated there would be “more difficult decisions” on tax and spending.
Mr Hunt is focused on lowering debt in the medium term and putting public finances on “a sustainable footing”.
Using the word “sustainable” implies the previous plan was unsustainable.
In light of this, government departments will be asked to find efficiencies within their budgets. The Chancellor is expected to announce further changes to its fiscal policy on October 31 to put the public finances on a sustainable footing.
TAX CUTS SCRAPPED
The Chancellor announced a reversal of almost all of the tax measures set out in the Growth Plan that have not been legislated for in parliament.
The following tax policies will no longer be taken forward:
Cutting the basic rate of income tax to 19% from April 2023. While the Government aims to proceed with the cut in due course, this will only happen “when economic conditions allow for it, and a change is affordable”. The basic rate of income tax will therefore remain at 20% indefinitely. This is worth around £6 billion a year.
Cutting dividends tax by 1.25 percentage points from April 2023. The 1.25 percentage points increase, which took effect in April 2022, will remain in place. This is valued at around £1 billion a year.
Repealing the 2017 and 2021 reforms to the off-payroll working rules (also known as IR35) from April 2023. This will cut the Government’s growth plan’s cost by around £2 billion a year.
Introducing a new VAT-free shopping scheme for non-UK visitors to Great Britain. Not proceeding with this scheme is worth around £2 billion a year.
Freezing alcohol duty rates from February 1 2023, for a year. Not proceeding with the freeze is worth approximately £600 million a year.
This follows from the previously announced decisions not to proceed with the Growth Plan proposals to remove the additional income tax rate and to cancel the planned increase in the corporation tax rate.
The changes are estimated to be worth around £32 billion a year.
That still leaves the Government with a lot to find to plug the hole in its finances, which indicates more pain will follow in public spending.
The Government’s reversal of the National Insurance increase, the Health and Social Care Levy, and the Stamp Duty Land Tax cuts will continue to benefit millions of people and businesses.
The £1 million Annual Investment Allowance, the Seed Enterprise Investment Scheme and the Company Share Options Plan will continue supporting business investment further.
ENERGY BILL SUPPORT TO CHANGE
In September, the Government announced massive financial support to protect households and businesses from high energy prices.
The Energy Price Guarantee and the Energy Bill Relief Scheme support millions of households and businesses with rising energy costs.
The Chancellor made clear they will continue to do so from now until April next year.
However, looking beyond April, the Prime Minister and the Chancellor have agreed that it would be irresponsible for the Government to continue exposing the public finances to unlimited volatility in international gas prices.
A Treasury-led review will therefore be launched to consider how to support households and businesses with energy bills after April 2023. The review’s objective is to design a new approach that will cost the taxpayer significantly less than planned whilst ensuring enough support for those in need.
The Chancellor also said in his statement that any support for businesses will be targeted to those most affected and that the new approach will better incentivise energy efficiency.
“CHAOS AT THE HEART OF GOVERNMENT”
Rebecca Evans, Wales’s Finance Minister, responded: “The complete unravelling of the mini-budget shows the chaos at the heart of the UK Government.
“In six short weeks, the UK Government’s reckless and flawed economic policy has caused mayhem in the financial markets, pushed up mortgage costs and stretched household budgets even further.
“Now the UK Government is rolling back on its energy price support scheme for households, which will only add to the uncertainty people face as they worry about paying their bills.
“The new Chancellor has signalled a new era of austerity to start to fill the hole in public finances.
“We will all pay for the Government’s mistakes. But this is a crisis made in Downing Street and one it needs to address.
“The Chancellor needs to use his next financial statement to provide reassurance we will not see the deep spending cuts that will affect jobs, services and our economy – and to provide support to vulnerable households who have been ignored today.”
Wales stands firm in support for Ukraine
IN THE latest update on the Ukraine crisis, Wales’s Minister for Social Justice Jane Hutt thanked all those households across Wales who have come forward to offer their homes to Ukrainians fleeing the War and encouraged more households to provide this vital support.
APPEAL FOR MORE HOST FAMILIES
The Minister for Social Justice said: “I’m delighted to say that over 5,650 people from Ukraine, sponsored by the Welsh Government and Welsh households, have already arrived in the UK.
“More than 8,200 visas have now been issued to people from Ukraine who have sponsors in Wales, so we expect the number of arrivals to continue to grow in the coming weeks.
“Thousands of Welsh households sponsored Ukrainians to arrive in Wales and committed to hosting them for at least six months.
“As we move into the autumn, we approach the end of that initial period.
“We hope hosts and Ukrainians will agree to extend many of those placements, but we need additional hosts to support those who cannot continue living where they are.
“To ensure a warm welcome to Wales, I’m inviting households across Wales to come forward and open their homes to welcome those seeking sanctuary.
“We’re immensely thankful to all those across Wales acting as hosts to Ukrainians, but more households must come forward.
“I completely understand that there are those who want to help but may not have the resources to do so, given the circumstances we’re all facing with the cost-of-living crisis.”
WALES WILL STEP UP TO THE PLATE
Jane Hutt continued: “What we all know, and has been proven countless times, is that the people of Wales are one of the most generous across the globe, and I’m sure we will step up to the plate once again.
“The idea of hosting can be daunting. That’s why we have funded Housing Justice Cymru to provide a Host Support service which includes expert and reliable information, training, advice, and guidance for people hosting, or those considering hosting, Ukrainians in Wales.
“More information on sessions and training can be found on the Housing Justice Cymru website. We also publish regularly updated guidance for hosts and sponsors at gov. wales/ukraine.
“We still need many more households to consider whether they could provide a home for those in need. This would normally be a commitment to hosting for 6 to 12 months.
“If anyone is considering this, we encourage them to register their interest at gov.wales/offerhome, and to attend one of the ‘Introduction to Hosting’ sessions, facilitated by Housing Justice Cymru. You won’t need to continue the process if you decide it is not for you.
“We have also partnered with Airbnb.org to ensure very short-term emergency placements can be provided to prevent homelessness.
“If you cannot host for more than 6 months but you could offer your property for up to 30 days at a time, you may also be able to contribute. Visit gov.wales/offerhome and follow the link to the Airbnb.org platform.”
Finally, the Minister stated: “We will continue to communicate with those who host Ukrainians, with updated guidance and information to support the valuable role you are undertaking.
“To all those that are already hosting and to those that are considering hosting, thank you, we owe you all a huge debt of gratitude.”
WESTMINSTER MUST BACK HOSTS
DURING COST-OF-LIVING CRISIS
Conservative MS Mark Isherwood raised how the cost-of-living crisis affects Ukrainian refugees.
Where families had taken in those fleeing Russian aggression, he noted a risk of sponsorships not continuing beyond six months because the hosts cannot afford the rise in fuel costs.
He asked the Minister what discussions she’d had with the UK Government about increasing the £350 contribution to households who’d taken in Ukrainian refugees.
The Minister agreed with Mark Isherwood that ending a specific ministerial post dealing with refugees was regrettable.
She noted a lack of information from the UK Government over the summer months and since Liz Truss replaced Boris Johnson as head of the Conservative Government.
Ms Hutt said: “We asked for an increase at least to £500, or up again, doubling to £700 per month. An urgent decision is needed regarding this as they reach the end of their six-month period.
“That period is underway, so we’re writing to all hosts to see if they will continue.”
UK GOVERNMENT URGED
TO PICK UP THE PHONE
The Minister thanked Mark Isherwood for introducing her to a charity offering support in North Wales, Link, and hoped that he and his colleagues would bring pressure to bear on their Westminster colleagues to ensure those in need from Ukraine and those in Wales helping them received support.
She added: “I look forward perhaps that we might have some telephone calls from the Prime Minister and other Ministers to us in Government. We must engage with them and follow this through.
“There is a huge job of work to be done here. We’re taking responsibility in the way I’ve outlined, funding our welcome centres and paying thank-you payments to hosts if they support a family who initially arrived in Wales under the Ukraine family scheme.
“That’s not happening in England. The commitment that we’re making is considerable.
“I hope everyone will join us today, saying that we need to press for those answers in terms of financial support.”
THE THREAT OF HOMELESSNESS
Sioned Williams of Plaid Cymru raised the spectre of Ukrainian refugees becoming homeless in Wales due to a lack of financial support and the end of existing hosting and housing placements.
The Minister praised the work of local authorities across Wales supporting refugees.
She said: “There are very imaginative programmes. That includes a whole range of issues like repurposing empty buildings.
“Local authorities are really coming up with a whole range of ways in which we can support people, perhaps, from a welcome centre, or a host family, into that intermediate accommodation, and then on to other longer-term accommodation.”
Pembrokeshire currently houses around 200 Ukrainian refugees, with the demand for assistance outstripping the availability of suitable accommodation.
NOT ONE PENNY FROM WESTMINSTER
TO SUPPORT FAMILIES FLEEING WAR
Responding to a question from Mabon ap Gwynfor about problems housing family groups, Jane Hutt hit out at the lack of support from the UK Government and how it’s u-turned on a commitment to help families.
“The UK Government has never given a penny towards the family scheme.
“The former Prime Minister, Boris Johnson, in one of his last PMQs, actually said that he thought the Ukraine family scheme should get the same funding and support as the Homes for Ukraine scheme. It’s never happened.
“We have provided thank-you payments to people who are hosting Ukrainian families. It’s all Welsh Government money; it’s not UK Government, because they don’t provide a penny. And also, the British Red Cross—£246,000—who are actually supporting Ukrainian families who are hosting family members under the Ukrainian family scheme.”
On Wednesday, September 28, Eluned Morgan, Wales’s Health Minister, announced the continuation of free healthcare in Wales to Ukrainian residents displaced by the ongoing conflict.
The exemption will continue to apply unless there’s a significant change in circumstances in Ukraine.
Kwarteng gambles on rush for growth
CHANCELLOR of the Exchequer Kwasi Kwarteng unveiled his and Liz Truss’s economic vision for the UK on Friday morning.
The headlines are straightforward.
There will be £45bn in tax cuts by 2027; however, the largest cuts – national insurance cuts, the abolition of the cap on bonuses and the highest income tax rate- benefit only high earners.
Cut in the basic rate of income tax to 19% from April 2023;
National Insurance will not rise as scheduled, and the Government will reverse the current year rise as of November 6;
New Health and Social Care Levy to pay for the NHS will not be introduced;
The top rate of income tax was cut from 45% to 40%;
Cancel the rise in corporation tax which was due to increase from 19% to 25% in April 2023;
Rules around universal credit tightened by reducing benefits if people don’t fulfil job search commitments;
VAT-free shopping for overseas visitors;
End of the cap on bankers’ bonuses;
Planned increases in the duties on beer, cider, wine, and spirits cancelled;
Government to discuss setting up investment zones with 38 local areas in England.
Alongside the above, the Chancellor announced plans to remove environmental safeguards for building developments and reduce the regulatory burden on financial institutions.
KWARTENG LEAVES LABOUR AN OPEN GOAL
In an interview with Rishi Sunak during the Conservative leadership contest, Nick Robinson observed that it would be a nasty surprise for the former Chancellor when he found out who’d been in power for the last twelve years.
Kwasi Kwarteng followed Liz Truss’s preferred method of operation: he pretended they hadn’t happened.
The Chancellor comprehensively dumped on the policies pursued over the last dozen years by successive Conservative governments, for a decade of which Liz Truss has been a member.
His statement was, as one ministerial colleague said, “a game changer”, although perhaps not in the way he envisaged.
So complete was the change of economic policy that it leaves an open question about how Mr Kwarteng and his Cabinet colleagues ended up in the same political party as most of their backbench colleagues and served under the last three Conservative leaders.
Shadow Chancellor Rachel Reeves did not miss the open goal. Even as Mr Kwarteng and Ms Truss shook their heads on the government benches, she hammered home that the Chancellor’s statement was an admission the record of Conservative governments since 2010 was one of a failure to deliver growth or a viable economic plan.
THE SUPPLY SIDE FIX
The Chancellor and Prime Minister’s rationale is that cutting taxes for the already well-off will benefit all citizens as they are incentivised to invest and act in entrepreneurial ways. In addition, reducing regulation for businesses will encourage increased commercial enterprise.
They believe the growth stimulated will make up for any loss in tax revenues as increased economic activity, encouraged by lower taxes, leads to increased government revenues.
That approach is called supply-side economics, which focuses on increasing the supply of goods and services through growth.
In every developed nation where the Government’s brand of economics has been tried, two things have happened: a cataclysmic bust has followed a short-term burst of economic activity.
In addition, wealth inequalities – and the UK is already grossly unequal – are embedded and made worse.
Low taxes on the wealthiest do not distinguish between those who generate wealth through their industry or create economic activity through business investment and those who inherit wealth or sit on capital without producing anything.
“THE RICH WILL REJOICE”
Wales’s Finance Minister, Rebecca Evans MS, responded: “Rebecca Evans, Minister for Finance and Local Government, said: “Instead of delivering meaningful, targeted support to those who need help the most, the Chancellor prioritises funding for tax cuts for the rich, unlimited bonuses for bankers, and protecting the profits of big energy companies.
“Instead of increasing funding for public services in line with inflation, we get a Chancellor blithely ignoring stretched budgets as public services find their money is not going as far as it did before.”
Plaid Regional MS Cefin Campbell said: “This Budget will see the rich rejoice as their bonuses rocket and their tax bill sliced, once again it will be the poorest and most vulnerable bearing the brunt of the disastrous cost of living crisis.”
Plaid Cymru’s Treasury spokesperson, Ben Lake MP, added: “Tax cuts for the super-rich will do absolutely nothing to drive growth in the Welsh economy.
“I urge the UK Government to recognise that our Government in Wales must be given the fiscal tools to unlock our economic potential ourselves. That is the only way to improve the lives of people across Wales.”
Welsh Conservative Shadow Minister for Finance, Peter Fox MS, said: “Today shows that the UK Conservative Government has a comprehensive plan to provide a sharp boost to the economy by putting cash back into people’s pockets. Labour in Wales has the power to cut taxes in Wales but chooses not to.
“Mark Drakeford needs to take a leaf out of Liz Truss’ book and take immediate action to support hard-working people and struggling businesses, stimulating the Welsh economy rather than stifling it.”
Scott Corfe, Research Director at Social Market Foundation, said: “The Chancellor is taking a very high-risk gamble with the economy.
“If his package of enormous tax cuts and ‘supply side reforms’ fails to translate into significantly higher economic growth, we risk further falls in the pound and surging gilt yields as investors lose confidence in our ability to pay our way in the world.
“That, in turn, means higher inflation, an unsustainable trajectory for the public finances and steeper interest rate rises – potentially deepening rather than alleviating the cost of living crisis.”
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