Sunak defends taking money from deprived urban areas as he faces latest hustings with Liz Truss

From 2h ago

Rishi Sunak defends saying he took funds away from deprived urban areas

Rishi Sunak has defended his comments after a video, shared with The New Statesman magazine, shows him telling grassroots Tories in Kent that he had been working to divert funding from “deprived urban areas” towards prosperous towns.
The former chancellor said today that it is not solely “big urban areas that require that extra investment”. He told Sky News: “It’s right that those funding formulas are accurate, that they actually look at the need in different areas, measure that properly and reflect how things have changed from the past.

“And I think that’s an entirely sensible thing to be doing, because it’s not just big urban areas that require that extra investment.

“It’s also people in rural communities, it’s also people in towns and that’s what we’ve done, both as a Government in the past, what I want to do as prime minister in the future.

“Level up across the country so that no matter where people live, they feel incredible opportunities and pride in the place that they call home.”

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Truss has been interrupted again by “somebody who shouldn’t have a microphone” the audience is told.

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It is unclear whether this was a member of the same protest group as earlier.

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She said: “I take it as a compliment that I’m so popular with Extinction Rebellion.”

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Liz Truss is first on stage and is interrupted by a heckler holding a placard, who is booed by the audience and escorted out the venue by security staff.

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Nusrat Ghani has announced she is supporting Liz Truss at the hustings.

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The MP for Wealden praises Truss’s “bold and conservative” plan, insisting she will “defend the unity of our nation and protect the peace in Northern Ireland”.

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Because of her role within the 1922 Committee, Ghani could not back a candidate until this stage of the contest.

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The latest Conservative Party leadership hustings is taking place at 7pm in Eastbourne, you can follow all the action here.

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“And I think that’s an entirely sensible thing to be doing, because it’s not just big urban areas that require that extra investment.

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“It’s also people in rural communities, it’s also people in towns and that’s what we’ve done, both as a Government in the past, what I want to do as prime minister in the future.

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“Level up across the country so that no matter where people live, they feel incredible opportunities and pride in the place that they call home.”

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The UK business secretary, Kwasi Kwarteng, has admitted it will be more than a month before ministers can introduce any measures to tackle the rising cost of living.

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Kwarteng, who is backing the foreign secretary, Liz Truss, to become the next leader of the Conservative party, said he was expecting a new prime minister to introduce a “support package” in an emergency budget but it could not happen until after they start work next month.

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Both Boris Johnson and the chancellor, Nadhim Zahawi, are on holiday as the Bank of England warns the economy will enter the longest recession since the 2008 financial crisis. The UK is forecast to suffer an economic downturn lasting more than a year.

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Kwarteng said: “I don’t know where Boris is,” but claimed the public would not begrudge the outgoing prime minister taking a honeymoon. He went on to say he was in “regular contact” with Johnson.

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Read the full article here.

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Tony Danker, the CBI director general, has said he fears a power vacuum amid the Tory leadership contest, warning that the economic crisis “cannot wait until 5 September for action”.

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His comments came as both Boris Johnson and Nadhim Zahawi are both on holiday as the country braces for a looming economic crisis.

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He told BBC Radio 4’s World at One:

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I have no problem with people having short holidays. My fear is much more profound, which is that there will be a vacuum from now until 5 September. We need the current prime minister and the current chancellor to fill that vacuum. We need them to make decisions. We need them to make plans. We need them to reassure firms, markets and households that we are gripping this.

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We cannot wait until 5 September for action. We cannot wait until 5 September for plans and we cannot wait until 5 September for reassurance.

\n

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He added:

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I think they need to be developing these interventions that are going to help people with the cost of living in the autumn. They need to be signalling on 26 August when Ofgem signal what the price rise is going to be.

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They need to be signalling that the government has a response and an answer. And they need to be setting out growth plans and growth intentions now.

\n

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Lisa Nandy, the shadow secretary of state for levelling up, has written to Greg Clark, the levelling up secretary and Tunbridge Wells MP, about Rishi Sunak’s “scandalous” admission that he “funnelled public money away from deprived areas and gave it to affluent Tory shires”.

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The Labour MP for Wigan called on Clark to “urgently investigate” what changes were made to funding and what justified them.

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It’s scandalous that Rishi Sunak funnelled public money away from deprived areas and gave it to affluent Tory shires.

The Levelling Up Secretary needs to urgently investigate what changes were made to funding formulas and what justified the changes.

✍️ My letter to @GregClarkMP pic.twitter.com/wQHV7ESHPi

— Lisa Nandy (@lisanandy) August 5, 2022

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Conservative politicians have been responding to Rishi Sunak’s remarks that he had been working to divert funding from “deprived urban areas” towards more prosperous towns.

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Foreign Office minister Zac Goldsmith said the leaked video was “one of the weirdest – and dumbest – things I’ve ever heard from a politician”.

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This is one of the weirdest – and dumbest – things I’ve ever heard from a politician https://t.co/lxFzrHGeYY

— Zac Goldsmith (@ZacGoldsmith) August 5, 2022

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Jake Berry, the chairman of the Northern Research Group of Tory MPs, said that in public Sunak “claims he wants to level up the North, but here, he boasts about trying to funnel vital investment away from deprived areas”.

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In public @RishiSunak claims he wants to level up the North, but here, he boasts about trying to funnel vital investment away from deprived areas?

He says one thing and does another – from putting up taxes to trying to block funding for our armed forces and now levelling up… https://t.co/Hwwn9fWffe

— Jake Berry MP (@JakeBerry) August 5, 2022

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But supporters of Sunak rallied around him, with Conservative Tees Valley mayor Ben Houchen arguing Boris Johnson led the party to electoral victory on a pledge to invest in areas “that have been ignored at the expense of urban cities”.

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Strangely enough,most red wall areas that voted Conservative for the first time in 2019 -who have been left behind for decades -aren’t urban/city areas.Exactly the whole point of levelling up. Like the Green Book favouring London and Birmingham over Boro and tunbridge wells

— Ben Houchen (@BenHouchen) August 5, 2022

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A leaked video shows Rishi Sunak boasting to Conservative party members that he was prepared to take public money out of “deprived urban areas” to help wealthy towns, the New Statesman reports.

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The former chancellor was recorded on 29 July telling party members in Tunbridge Wells, Kent:

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I managed to start changing the funding formulas, to make sure areas like this are getting the funding they deserve because we inherited a bunch of formulas from Labour that shoved all the funding into deprived urban areas and that needed to be undone. I started the work of undoing that.

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EXCLUSIVE: In a leaked video, Rishi Sunak boasted to Conservative Party members that he was prepared to take public money out of “deprived urban areas” to help wealthy towns.@REWearmouth reports: https://t.co/uZMpjKm6rG pic.twitter.com/07sSzDksMT

— The New Statesman (@NewStatesman) August 5, 2022

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Labour expressed anger at the video, telling the magazine that it was “scandalous that Rishi Sunak is openly boasting that he fixed the rules to funnel taxpayers’ money to prosperous Tory shires”.

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The shadow levelling up secretary, Lisa Nandy, added:

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This is our money. It should be distributed fairly and spent where it’s most needed – not used as a bribe to Tory members.

\n

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Robert Hayward, a Conservative peer and elections analyst, said Rishi Sunak’s performance in last night’s debate caused “a stop in terms of the momentum in one direction” of the leadership campaign.

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Last night marked the first time Sunak had “clearly led” in a debate, Lord Hayward told Sky News this morning, adding that Truss had struggled when asked about her policy U-turn on public sector pay.

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He said:

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There’s no question in my mind and the vote of the audience, it was the first time that he had clearly led in a debate.

\n

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He added:

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Liz has had the best of the last few days, no question about it, with the series of endorsements from different major personalities. I think what happened last night was there was a stop in terms of the momentum in one direction.

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It won’t necessarily have reversed it, but there will be this morning a different sense of messaging that is around.

\n

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Good morning

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The business secretary, Kwasi Kwarteng, who is backing Liz Truss in the Conservative leadership contest, has admitted that “I don’t know where Boris is” but insisted the prime minister is in “constant contact” with him.

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Johnson and his chancellor, Nadhim Zahawi, have been criticised for being on holiday on the day the Bank of England announced the biggest interest rate rise in 27 years and forecast an economic downturn lasting more than a year.

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The PM has been on holiday since Wednesday and Zahawi is away with his family and was not available for interviews in the wake of the BoE’s grim predictions.

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When asked if the PM is on holiday, Kwarteng told Times Radio:

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I don’t know where Boris is, but I’m in constant contact with him. He’s just had a wedding, I think he’s on a honeymoon and … I don’t think many people will begrudge him that.

\n

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Speaking to LBC radio, Kwarteng said he believed the chancellor was “completely on top of the situation”. He added:

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He’s completely aware of what’s going on and his officials and he are working very hard to see how best we can generally be we can deal with this.

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I think I think he’s on top of the situation. I think his arrangements are up to him.

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He said it is “completely false” to say the government is doing nothing over the summer, adding on Times Radio:

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I said we’re going to have to wait four weeks for an emergency budget because that’s how we help people – it’ll be through the new chancellor, new prime minister, whoever they are, to come up with the measures. But the idea we’re doing nothing in the meantime is false.

\n

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Meanwhile, Liz Truss and Rishi Sunak each took part in a televised leadership interview where the foreign secretary was challenged about the Bank’s projections as it increased interest rates by 0.5 percentage points.

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Truss claimed her tax cut plans could avert the looming recession, while Sunak stepped up his criticisms of her £30bn plan for unfunded tax cuts, claiming it would lead to “misery for millions”.

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Kwarteng, who is backing Truss to be leader, argued that carrying on with the current economic policy “is not going to cut it” and that raising taxes is “adding insult to injury”.

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He defended the foreign secretary’s tax cuts plan, arguing that taking more of people’s money through tax when their real income is being squeezed by inflation “doesn’t make any sense”.

","elementId":"0fdd3117-55df-46f6-89c8-eabba3b5f2fc"},{"_type":"model.dotcomrendering.pageElements.TextBlockElement","html":"

He told BBC Radio 4’s Today programme:

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\n

There is pressure on public finances but the immediate problem, as Liz always said, is one of growth.

\n

She talked about recession very early on, a few weeks ago, at the beginning of the leadership contest, and the risk of recession means that you can’t have rising interest rates, which we saw yesterday, and also have tighter fiscal policy. No economist in the world is going to say that the way to deal with a looming recession is to tighten monetary policy and to tighten fiscal policy at the same time.

\n

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Here’s the agenda of the day.

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9.30am: The Office for National Statistics publishes the results of its latest survey of the social impacts of the cost of living, goods shortages and Covid-19.

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7pm: Truss and Sunak will meet in Eastbourne tonight for hustings with party members in the southeast.

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I’ll be covering for Andrew Sparrow today. Do drop me a line if you have any questions or think I’ve missed anything. My email is leonie.chao-fong@theguardian.com or you can reach me on Twitter.

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Key events

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