Explainer
Three weeks of chaos that cost more than
Kwarteng’s job – in numbers
On 30 September, the then chancellor’s mini-budget
triggered a chain of events that led to a dramatic downfall
Jamie
Grierson
@JamieGrierson
Fri 14 Oct
2022 17.00 BST
It is three
weeks since the now former chancellor Kwasi Kwarteng delivered his not-a-budget
budget, a package of £45bn of unfunded tax cuts.
To say the
so-called growth plan spooked investors in the financial markets would be an understatement;
the response was a damning indictment of economic policies that were at the
heart of Liz Truss’s pitch to be Conservative leader and prime minister.
The shadow
climate change secretary, Ed Miliband, said Kwarteng’s sacking and expected
U-turns on the mini-budget were not just the death of a policy but “the death
of an ideology”.
Here we
number-crunch the political and economic damage caused by three weeks of chaos.
28%
The latest
YouGov/Times voting intention poll published on Thursday shows Labour
maintaining the enormous lead (28%) they opened up over the Conservatives last
month. The figures show the Conservatives on 23% of the vote (+1 from previous
survey on 6-7 October) to Labour’s 51% (-1).
-47%
Liz Truss’s
personal ratings are now even worse than those recorded for Boris Johnson at
the height of the Partygate scandal, according to an Observer poll. A rating of
-47 is now the worst ever recorded for a prime minister in an Opinium poll. It
is a worse rating than that recorded for Johnson during Partygate and Theresa
May in the weeks before her resignation.
£19.3bn
The Bank of
England set aside £65bn for an emergency bond-buying programme to stem the
crisis triggered by Truss and Kwarteng’s growth plan, which put entire pension
funds at risk of insolvency. As of Friday, when the programme was due to end,
the Bank had spent £19.3bn.
6826.15
The FTSE
100 closed at 6826.15 on Wednesday, its lowest level in the last 12 months.
Since the mini-budget the index has fallen, risen and fallen again, underlining
the nerves of investors.
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4.3%
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The yields
on gilts (UK government bonds) surged after Kwarteng’s announcement in
September. The yield on the UK’s benchmark 10-year gilt hit about 4.3% in late
September and has fallen and risen since. Rising bond yields suggest a lack of
willingness among investors to own the debt, as buyers demand a lower price to
buy them.
1.03
The pound
fell to a record low of 1.03 against the US dollar on 26 September after
Kwarteng doubled down on his £45bn package of tax cuts by pledging on live TV
to go further. The pound has since risen, fallen and risen again, underlining
the wavering faith investors have in the UK economy.
3,674
The
distance in miles from Washington DC to London, as flown by Kwasi Kwarteng so
he could be sacked in person.
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