London Daily

Focus on the big picture.
Thursday, Jul 24, 2025

Rishi Sunak and Liz Truss row over recession warning in latest TV clash

Rishi Sunak and Liz Truss row over recession warning in latest TV clash

Tory leadership rivals Rishi Sunak and Liz Truss have set out competing plans to deal with the economic recession forecast by the Bank of England in their latest TV clash.

Mr Sunak said Ms Truss's "unfunded" tax cuts would pour "fuel on the fire" of inflation.

But Ms Truss said a recession was "not inevitable" if "bold" action was taken.

The Bank's gloomy forecast of a recession this year loomed large in the TV special, hosted by Sky News.

It earlier raised interest rates to the highest level in almost three decades, from 1.25% to 1.75%, in an attempt to push back skyrocketing prices.

The inflation rate is forecast to hit a 42-year high of 13% this year, while the UK economy is expected to shrink for more than a year.

The Bank said the main reason for high inflation and low growth is rising energy bills, driven by Russia's invasion of Ukraine.

The worsening state of the UK economy has dominated the Tory leadership campaign, with both candidates putting forward rival visions to deal with the fallout.

Mr Sunak, who has trailed Ms Truss in recent polls, has repeatedly said he would prioritise bringing inflation down before cutting taxes, if he became prime minister.

Meanwhile, Ms Truss has pledged a package of tax cuts worth £30bn soon after she enters office, which Mr Sunak has argued would increase inflation and the cost of borrowing.

Mr Sunak told the Sky News programme: "We in the Conservative Party need to get real and fast - because the lights on the economy are flashing red and the root cause is inflation.

"I'm worried that Liz Truss's plans will make the situation worse."

Ms Truss reiterated her pledge to immediately reverse April's increase in National Insurance and cut other taxes, which she claimed would stimulate economic growth and prevent a recession.

"What the Bank of England have said... is of course extremely worrying, but it is not inevitable," she said.

"We can change the outcome and we can make it more likely that the economy grows."


While the governor of the Bank of England gave a sombre press conference, the candidates to be the next prime minister were preparing for their next turn in a TV studio.

The two candidates - once again - took the chance to have a pop at each other's economic plans.

Liz Truss claimed the tax levels Rishi Sunak advocates will lead to recession, not growth; Rishi Sunak claimed Liz Truss' plan to cut taxes will exacerbate inflation and prolong economic pain.

It is territory the two have clashed over before, but while the wannabe PMs keep exchanging blows on the finer points of fiscal policy, there will be many worried families and businesses simply wondering whether the help on offer will be anywhere near enough - or what more may come.

The pair are vying to win over Conservative Party members, whose votes will determine which of them will become the next Tory leader and prime minister.

The party's roughly 160,000 members started receiving ballot papers on Monday, with the result due on 5 September, when Prime Minister Boris Johnson will leave office.

Despite trailing in many polls of members, there may be solace for Mr Sunak who appeared to win the most support among the Sky News audience members in a show of hands.

The programme saw an audience made up of Conservative members grill them about their programmes for government on a range of issues, including NHS funding, immigration and climate change.


In one testy exchange, Ms Truss disagreed with an audience member who expressed concerns about the debt that would be incurred by the foreign secretary's tax plans.

Ms Truss said in response that "trying to balance the books prematurely is actually counterproductive" and growing the economy was more important.

Asked if she was happy with the answer, the Conservative member said she was not.

She told Ms Truss that what former Tory prime minister Margaret Thatcher "believed in was sound money", adding "this is not sound economics".


Ms Truss was also put on the backfoot by programme host Kay Burley, who repeatedly asked the foreign secretary if her now-scrapped proposal to link public sector pay to local living costs was "a mistake".

But Ms Truss resisted such an admission, and instead insisted her regional pay policy was "misrepresented by various people".

At times, Mr Sunak looked uncomfortable when pressed by Ms Burley, too. She asked how he felt about so many former cabinet colleagues - including Nadhim Zahawi, Ben Wallace and Sajid Javid - backing Ms Truss's campaign and not his.

"Plenty of people who have sat around the cabinet table also support me," Mr Sunak said, highlighting Deputy Prime Minister Dominic Raab as one of his supporters.

On whether there was nothing he could do about a recession, Mr Sunak said: "Of course, there is, of course."

He said Ms Truss was wrong to suggest the tax burden was causing the recession, pointing instead to inflation.

In other parts of the TV programme, Ms Truss:

*  said she wanted to encourage doctors who came out of retirement to help the NHS during the pandemic "to come back into the profession"

*  refused to say whether she would suspend Boris Johnson as a Tory MP if he was found to have lied to Parliament

*  insisted she has nothing to hide, telling the audience "there are no skeletons in my closet"

And Mr Sunak:

*  insisted he would "fight incredibly hard 'til the last day" of the leadership campaign and not quit before results day

*  said an "enormous difference" can be made between now and next winter to reduce the UK's dependence on Russian energy

*  defended an old video where he claimed not to have any working-class friends, saying "we all say silly things when we are younger"

Speaking after the debate, Labour's shadow minister without portfolio Conor McGinn said whichever candidate won their "low-growth, low-wage plans" would not fix the economic crisis.

"The two continuity candidates have no answers to sky-high inflation, rocketing energy bills and the lengthy recession the Bank of England has warned is on the horizon," he said.


WATCH: The Battle for Number 10 - Moments from the Sky News special



Newsletter

Related Articles

0:00
0:00
Close
Politic is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
Thai Civilian Death Toll Rises to 12 in Cambodian Cross-Border Attacks
TSUNAMI: Trump Just Crossed the Rubicon—And There’s No Turning Back
Over 120 Criminal Cases Dismissed in Boston Amid Public Defender Shortage
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
The Podcaster Who Accidentally Revealed He Earns Over $10 Million a Year
Trump Announces $550 Billion Japanese Investment and New Trade Agreements with Indonesia and the Philippines
US Treasury Secretary Calls for Institutional Review of Federal Reserve Amid AI‑Driven Growth Expectations
UK Government Considers Dropping Demand for Apple Encryption Backdoor
Severe Flooding in South Korea Claims Lives Amid Ongoing Rescue Operations
Japanese Man Discovers Family Connection Through DNA Testing After Decades of Separation
Russia Signals Openness to Ukraine Peace Talks Amid Escalating Drone Warfare
Switzerland Implements Ban on Mammography Screening
Japanese Prime Minister Vows to Stay After Coalition Loses Upper House Majority
Pogacar Extends Dominance with Stage Fifteen Triumph at Tour de France
CEO Resigns Amid Controversy Over Relationship with HR Executive
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
NVIDIA Achieves $4 Trillion Valuation Amid AI Demand
US Revokes Visas of Brazilian Corrupted Judges Amid Fake Bolsonaro Investigation
U.S. Congress Approves Rescissions Act Cutting Federal Funding for NPR and PBS
North Korea Restricts Foreign Tourist Access to New Seaside Resort
Brazil's Supreme Court Imposes Radical Restrictions on Former President Bolsonaro
Centrist Criticism of von der Leyen Resurfaces as she Survives EU Confidence Vote
Judge Criticizes DOJ Over Secrecy in Dropping Charges Against Gang Leader
Apple Closes $16.5 Billion Tax Dispute With Ireland
Von der Leyen Faces Setback Over €2 Trillion EU Budget Proposal
UK and Germany Collaborate on Global Military Equipment Sales
Trump Plans Over 10% Tariffs on African and Caribbean Nations
Flying Taxi CEO Reclaims Billionaire Status After Stock Surge
Epstein Files Deepen Republican Party Divide
Zuckerberg Faces $8 Billion Privacy Lawsuit From Meta Shareholders
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
SpaceX Nears $400 Billion Valuation With New Share Sale
Microsoft, US Lab to Use AI for Faster Nuclear Plant Licensing
Trump Walks Back Talk of Firing Fed Chair Jerome Powell
Zelensky Reshuffles Cabinet to Win Support at Home and in Washington
"Can You Hit Moscow?" Trump Asked Zelensky To Make Putin "Feel The Pain"
Irish Tech Worker Detained 100 days by US Authorities for Overstaying Visa
Dimon Warns on Fed Independence as Trump Administration Eyes Powell’s Succession
Church of England Removes 1991 Sexuality Guidelines from Clergy Selection
Superman Franchise Achieves Success with Latest Release
Hungary's Viktor Orban Rejects Agreements on Illegal Migration
Jeff Bezos Considers Purchasing Condé Nast as a Wedding Gift
Ghislaine Maxwell Says She’s Ready to Testify Before Congress on Epstein’s Criminal Empire
Bal des Pompiers: A Celebration of Community and Firefighter Culture in France
FBI Chief Kash Patel Denies Resignation Speculations Amid Epstein List Controversy
Air India Pilot’s Mental Health Records Under Scrutiny
Google Secures Windsurf AI Coding Team in $2.4 Billion Licence Deal
Jamie Dimon Warns Europe Is Losing Global Competitiveness and Flags Market Complacency
×