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Rishi Sunak arrives in Manchester for his party conference on Saturday facing pressure from Conservative MPs over taxes and questions over his apparent plan to axe the HS2 high speed rail line to the city.
More than 30 Tory MPs have signed a pledge not to vote for any more tax rises, after a think-tank reported that taxes were on course to rise by £3,500 per household since 2019.
Jeremy Hunt, the chancellor, promised to end the “vicious circle of ever-rising taxes” by cutting the cost of public services, primarily through the use of new technology and by reforming the benefit system.
But that is not enough for some rightwing Conservatives who want Hunt to cut taxes in his Autumn Statement in November to kick-start growth.
Liz Truss will address a “growth rally” on the fringes of the conference on Monday in which the former prime minister will claim that she was right to push for aggressive tax cuts. The policy disintegrated after a disastrous mini-Budget last year.
In a sign of the tensions ahead of conference, which begins on Sunday, 33 Conservative MPs have signed a pledge to constituents not to “vote for or support any new taxes that increase the overall tax burden”.
The idea of Hunt increasing taxes before the election was — in any event — unlikely, given that Sunak and the chancellor hope to use next spring’s Budget to cut taxes, including possibly inheritance tax rates.
This week the Institute for Fiscal Studies said the £3,500 a year increase in household taxation expected by the next election — compared with 2019 — was the biggest increase over a parliament on record.
The IFS said that the Tory administration was forecast to raise £100bn more a year by 2024 than if taxes as a share of national income had stayed the same as in 2019.
Hunt said he would find savings by launching the “biggest transformation of public services in our lifetimes” with all departments told to find savings by reducing routine tasks carried out by frontline staff, aided by new technology.
In an interview with The Times newspaper, the chancellor also said he would overhaul the benefits system, which he described as “incredibly damaging to the economy and individuals”. He said that 100,000 people a year were moving from employment to benefits “without any obligation to look for work”.
Sunak, who said he expected to travel to Manchester by car because of a rail strike, will face further questions over his repeated refusal to guarantee that the HS2 rail line would be built beyond Birmingham to the north of England.
Mark Harper, transport secretary, refused to comment on “speculation in the media” that the line would only be built between London and Birmingham, insisting that most people travelled by car or bus rather than train.
Harper promised a better deal for motorists including “new guidance” to stop the “blanket imposition” of 20mph speed limits in urban areas, as had happened in Wales.
The minister told the BBC that such limits were appropriate in certain places, for example near schools. He was unable to name any 20mph policies in England that he would like to see reversed.