Why Kwasi Kwarteng was sacked as UK’s Chancellor of the Exchequer

The dismissal was after Kwarteng presented a mini-budget which resulted in financial turbulence and revolt from Conservative Party lawmakers.

While presenting the mini-budget on 23 September, an eye-watering £45 billion in tax cuts alongside an energy relief plan projected to cost £60 billion over the next six months was announced by Kwasi Kwarteng.

This, according to various media reportage was a huge departure from the fiscal policy of the Johnson government, which had planned tax rises to pay for health and social care and to manage the post-Covid deficit.

Kwarteng claimed his ambitious plans would drive growth and reduce inflation.

The financial markets disagreed: in the days after his announcement, lenders pulled mortgage packages, the pound hit a record low against the dollar, and the Bank of England started buying bonds at ‘an urgent pace’ to calm the markets and stop pension funds going bust.

In a high-risk strategy designed to revive Britain’s stagnant economy, the British of Ghanaian descent announced more than £400bn of extra borrowing over the coming years to fund the biggest giveaway since Tony Barber’s ill-fated 1972 budget.

The Guardian reported that the Conservative MP said tax cuts worth more than £55,000 annually to someone earning £1m a year were part of a new direction for the economy and were designed to help boost growth to 2.5% a year. Some Labour MPs described them as a “class war”.

The Treasury admitted there were no forecasts for the impact of the measures on growth and the gamble received a hostile reception not just from the markets and opposition politicians, but from economic think tanks and many Tory MPs, some of whom were aghast.

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