In a contemporary version of loose lips sinking ships, ministers in Liz Truss’ government are finding out that what they say has actual consequences. Home Secretary Suella Braverman, for instance, has risked a flagship trade deal between the UK and India, which was close to being sealed, by saying she was concerned about the prospect of immigration numbers rising due to the agreement.
Moreover, by arguing that Kwasi Kwarteng’s mini-budget was not to be blamed for the decline in the value of the pound and the rise in the cost of borrowing money from the government, Jacob Rees-Mogg ran the danger of intensifying the turbulence in the financial markets.
Despite the fact that both politicians have years of experience in positions of power, the new prime minister seems to have nurtured a culture of freewheeling in the Cabinet.
These interventions go beyond ministers merely being outspoken; instead, they run the risk of seriously harming the economy and commerce and endangering the credibility of the government.
Ms Braverman said last week that she had “some reservations” about the UK-India trade deal – which is supposed to be a flagship accord of the Truss Government – because it would increase migration into the UK. She said: “Look at migration in this country – the largest group of people who overstay are Indian migrants.”
Moreover, these comments have, understandably, outraged the Indian government which reports that the trade deal is now on the “verge of collapse”. Delhi is urging the UK PM to publicly distance herself from these comments if she has hopes of reviving the deal’s chances.
Mr Rees-Mogg said that the fall in the pound in the wake of the mini-Budget, and the ensuing rise in gilt yields, are due to “interest rate differentials” rather than the Chancellor’s fiscal statement.
This prompted Rupert Harrison, who was chief economic adviser to former chancellor George Osborne, to tweet “This kind of comment actively undermines the credibility of the government in the eyes of markets, who all know that it’s total nonsense.” The question now is how the PM responds to these potentially disastrous comments by members of her Cabinet, with the government already suffering a credibility deficit in the markets.
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