London Daily

Focus on the big picture.
Saturday, Oct 03, 2026

Labour criticises chancellor’s trip to US for ‘chinwag’

Labour criticises chancellor’s trip to US for ‘chinwag’

Nadhim Zahawi to go on fact-finding trip to discuss measures on energy costs in what are likely to be his last days in post
Nadhim Zahawi will spend what are likely to be his final few days as chancellor in the US on a fact-finding trip to discuss measures to tackle soaring energy costs.

Zahawi, who took over as chancellor eight weeks ago and is likely to be replaced if, as widely expected, Liz Truss is unveiled as the next Conservative leader, will also discuss the Ukraine war and cooperation on financial services.

He said he wanted to “work closely with my allies on the common challenges we face to create a fairer and more resilient economy at home and abroad” during the visit to New York and then Washington DC.

However, Zahawi will at most be able to gather ideas for possible future policies to be potentially implemented by a new chancellor, widely tipped to be Kwasi Kwarteng, the business secretary, if Truss takes over from Boris Johnson.

The outcome of the Conservative leadership contest will be announced next Monday, with the winner expected to formally take over as prime minister a day later.

While Johnson has pledged not to take any major decisions that would tie the hands of his successor, the lack of action amid the leadership contest, during which the prime minister has taken two holidays, has led to criticism that ministers have gone missing before an imminent national crisis over energy bills.

Labour argued that Zahawi’s US visit would change little. James Murray, the shadow financial secretary to the Treasury, said: “Families across the country are desperately worried about the massive rise in energy bills that is on the way but we’re stuck with this do-nothing Tory government. Now we discover the chancellor is jetting off to an international chinwag.”

Labour is seeking to put pressure on Truss over what it says is an unclear and often contradictory set of proposals from her camp to tackle energy bills, which are due to rise by 80% in October, with another steep increase expected in January.

Truss has not ruled out direct help for households over energy bills but she has refused to set out what this might include, and has repeatedly stressed that her priority is tax cuts rather than what she has termed “handouts”.

She has committed to suspending green levies on energy bills and reversing the recent rise in national insurance, intended to finance the clearing of the post-Covid NHS backlog and to reform social care.

Over the weekend it was reported that she could also cut VAT by 5% or more as a way to save people money, or even cut income tax.

However, critics have pointed out that income tax or national insurance cuts would disproportionately benefit the better-paid and not assist those relying on pensions or benefits, while essentials such as food are zero-rated for VAT.

Paul Johnson, the director of the Institute for Fiscal Studies, said an approach based on tax cuts was simplistic and risked pushing up the cost of borrowing.

“You clearly can’t do all of this without completely crashing the public finances,” he told the Times. “This simplistic mantra that you cut taxes and the economy grows more, that you cut taxes when you have a big deficit and high inflation, and you don’t do it with any other part of the plan, is quite worrying.”

Pat McFadden, the shadow chief secretary to the Treasury, said the lack of clarity from Truss was causing extra worry for people.

“The more different ideas spill out of the Tory leadership contest, the clearer it becomes that neither candidate has a plan to deal with the cost of living crisis,” he said. “It is energy prices that are driving this crisis. It is energy prices that are driving people to despair as they worry how to make ends meet. This flip-flopping by Liz Truss, floating one policy idea after another, is causing the country unnecessary worry about their bills.”
Newsletter

Related Articles

0:00
0:00
Close
Church of England to Apologize for Role in Historical Forced Adoptions
UK Defence Ministry Investigates Historical Use of RAF Bases by Jeffrey Epstein
Scottish Housing Completions Fall to 11-Year Low
Welsh First Minister Calls for Expanded Devolution Settlement
UK Pledges £50 Million to Expand Domestic Military Drone Capabilities
UK Opens First Commercial Geothermal Plant in Cornwall
Green Party Wins Gorton and Denton By-Election as Labour Falls to Third
Prime Minister Andy Burnham Opens Review of UK-EU Relationship
UK Inflation Rises to 3.1%, Adding Pressure on Household Finances
UK Removes VAT From Domestic Electricity Bills to Ease Winter Energy Costs
Counterterrorism Police Arrest Sixth Suspect Over RAF Fairford Incident
UK Councils to Receive Sweeping Planning Powers to Ban New Vape and Betting Shops
Chancellor John Healey Faces Tax and Pension Scrutiny Ahead of Autumn Budget
Metropolitan Police Apologise for Accidental Disclosure in High-Profile Investigation
UK Universities Report Record International Enrolment as Housing Pressure Grows
UK Logistics Firms Monitor Rhine Disruption as Low Water Threatens European Supply Chains
UK Food Industry Warns Inflation Could Approach 7%
UK Introduces Vaping Duty and Mandatory Retail Stamps
Scotland Raises Property Taxes and Expands Child Payment in Annual Budget
Greggs Plans Four Factory Closures With 740 Jobs at Risk
OECD Raises UK 2026 Growth Forecast to 1.1%
UK Inflation Rises to 3.1% as Bank of England Faces Rate Debate
Andy Burnham Criticises Brexit and Says Rejoining EU Single Market Remains an Option
UK Imposes New Sanctions on Russian Military Networks and Propagandists
UK Launches Nationwide Early-Release Prison Scheme
Andy Burnham Says Security Services See Signs of Iranian Involvement in RAF Fairford Incident
Manchester City Found Guilty on Premier League Financial Charges After Independent Investigation
Scottish Court to Rule on Bid to Force No-Confidence Vote Against Aberdeen Council Co-Leader
UK Bans Extra Charges for Seating Children Under 12 Beside Accompanying Adults
UK Introduces Vaping Duty and New Licensing Requirements
Greggs to Close Four UK Factories and Cut 740 Jobs
Hundreds of Prisoners Released Early as England and Wales Prisons Reach 98% Capacity
UK Unveils New Russia Sanctions Targeting War Funding and Shadow Fleet
Burnham Says There Are Strong Indications of Iranian Involvement in RAF Fairford Security Breach
Prime Minister Andy Burnham Raises Prospect of Reviewing Britain's Post-Brexit EU Relationship
Markets Price in Bank of England Rate Increases as Inflation Rises to 3.1%
UK Borrowing Costs Climb Toward 5.5% as Global Bond Sell-Off Intensifies
UK-France One-In-One-Out Migration Agreement Expires as London Seeks Alternative Measures
Southwest England Faces Flood Alerts After Heavy Autumn Storms
UK Expands Funding for Rapid Electric Vehicle Charging Infrastructure
Welsh Government Approves Funding to Upgrade South Wales Transport
Northern Ireland Tensions Rise as Orange Order Rejects Drumcree Compromise
NHS Leaders Back Early Design of Proposed National Care Service
More Than One-Third of Regional UK Universities Face Financial Deficits
UK Current Account Deficit Narrows as Cross-Border Financial Flows Remain Strong
Bank of England and FCA Issue New Rules for Stablecoins and Digital Assets
MI5 Warns UK Universities Over Research Links With Chinese Institutions
UK Energy Price Cap Rises 4% as Electricity VAT Is Temporarily Suspended
Equity Calls for UK Personality Rights to Protect Performers From AI Replication
OpenAI Pauses Advanced Model Training Following Safety Concerns
×