The chancellor will unveil his plans for £30bn of tax cuts and more details on the energy price cap announced by Liz Truss as part of a “mini-budget” on Friday. It is likely to frame the political debate for some time. However, he is preparing to review existing budget rules in the coming months to ensure the program can meet them. The tax cuts are set to break an existing rule that debt must fall as a percentage of GDP by 2024/25. Proposals to reverse the rise in national insurance are expected to cost £13 billion a year, while canceling the rise in corporation tax is expected to cost £17 billion a year. There are already concerns about a lack of transparency in Friday’s announcement. The Observer understands the Treasury select committee will demand clarity on the funding of the package and the impact on existing fiscal rules, as well as raising fears about the lack of independent costing. Kwarteng has not instructed the Office for Budget Responsibility (OBR) to produce an independent analysis to accompany his announcement. It has now emerged that Kwarteng could wait until the spring to hold his first full budget, meaning it could be months before the OBR can publish its assessment of his plans. Kwarteng is expected to announce any new fiscal rules at that point. “The chancellor has been clear that the government is committed to reducing the debt-to-GDP ratio over the medium term,” a source said. “However, as you would expect, given the severity of the economic shocks we are facing and the implementation of the Energy Price Guarantee, we will assess whether the current fiscal rules are working for the economy.” Economists at the Institute for Government, the Resolution Foundation and the Institute for Fiscal Studies (IFS) all questioned how the package could meet existing fiscal rules. Paul Johnson, director of the IFS, said: “If we have permanent tax cuts on top of the economic slowdown, then it’s hard to see how they meet the rules.” Tory peer David Willets also urged ministers to consider paying for the energy price cap, estimated to cost £100bn to £140bn, by raising property taxes. “Even if the government just says we will borrow the money, that means we will have to pay later,” he said. “Given that government is so focused on growth and mobility, raising taxes on profits is less good than looking at ways in which wealth – which is taxed less – also contributes.” It also comes with another row about the NHS, with suggestions that Health Secretary Thérèse Coffey could scrap or modify the four-hour target for patients to be seen in A&E. Sources close to Coffey said the measure would not be repealed. Patricia Marquis, director of the Royal College of Nursing for England, said: “But ministers need to be careful with their words and reassure both nursing staff and the public that their first priority is to reduce waiting times.” . Vishal Sharma, chairman of the BMA’s advisory committee, said removing the target “should not simply be a means of covering up these long waiting times and overcrowding in A&E, particularly as this is associated with worse patient outcomes”. “The biggest challenge we face in improving patient care is the severe workforce crisis that is crippling the NHS,” he said. “While it is encouraging that the new health minister sees this as an important issue that needs to be addressed, it is important that the government acts urgently to address this and implement the right solutions. “They need to start by reforming the punitive pension tax rules that are driving away highly skilled senior doctors. The BMA has been calling for this for years, but we have now reached a crisis point and immediate action must be taken before it is too late.” Saffron Cordery, interim chief executive at NHS Providers, said: “The NHS has been working for some time on plans for new performance standards that will better chart patients’ progress through urgent and urgent care. However, trust leaders are keen to ensure that any new measures are based on the clinical review of NHS standards and make sense to the public.”
