UK cabinet minister Michael Gove on Wednesday ruled out an emergency budget, squashing suggestions that the government was planning extra measures to help hard-pressed Britons squeezed by the cost of living crisis.
In a bizarre television appearance, Gove said Prime Minister Boris Johnson’s suggestion of assistance was “overinterpreted”, adding that claims of a split between Finance Minister Rishi Sunak and the PM over the need for more financial support were “overinflated”.
The government on Tuesday was excoriated by anti-poverty campaigners for failing to even acknowledge the biggest fall in living standards in seven decades in its new legislative programme.
In response, Johnson suggested he and Sunak would make an announcement “in the days to come”. However, the Treasury denied the assertion and Downing Street was quickly forced to backtrack, and conceded people should not be expecting any support soon.
“There won’t be an emergency budget. It is sometimes the case that the words from a prime minister or minister are overinterpreted,” Gove told Sky News.
He raised eyebrows and tempers after a strange performance on the BBC after being challenged over rumours of a split between Johnson and Sunak, who is resisting an emergency budget.
Gove adopted different accents as he said: “It is an example of some commentators chasing their own tails and trying to take a statement that is common-sensical, turning it into a ‘major’ capital letters ‘big news story’.”
“When the Treasury quite rightly say ‘calm down’, people instead of recognising that they have overinflated the story in the first place then say: ‘Oh, this is clearly a split.’.”
Labour Party MP Lisa Nandy, who shadows Gove’s Levelling Up portfolio said: “What is he doing!? Making jokes and using silly voices while families across the country are struggling to survive. This isn’t a game (or an Oxford Union debate!). People are having to choose between heating and eating.”
The rejection by Gove came as a report stated an estimated 1.5 million UK households faced being unable to pay food or energy bills this year, as the UK falls into recession.
The National Institute of Economic and Social Research, publishing its latest quarterly UK Economic Outlook, said real incomes were likely to decline by 2.4% this year, followed by a small rise in unemployment in 2023, to 5.1%.
GDP, meanwhile, was forecast to increase by 3.5% in 2022, after declining in the third and fourth quarters, before growing by just 0.8% in 2023 and 0.9% in 2024. A recession is defined as two consecutive quarters of economic decline.
“The combination of shocks – Brexit, Covid-19 and the recent shocks to energy prices – is set to leave the incomes of people in the UK permanently lower,” the NIESR said.
In particular, the NIESR estimates that 1.5m households will see food and energy bills greater than their disposable income in the 2022-23 financial year, as rising prices and higher taxes “squeeze” domestic budgets.
