Liz Truss has admitted herself that her tax cuts will disproportionately benefit the rich (Picture: Wiktor Szymanowicz/Future Publishing via Getty Images)

‘I am sick and tired of trickle-down economics. It has never worked.’

Not my words, or even the words of a Labour politician but the words of US President Joe Biden this week, the leader of the world’s largest economy. And he couldn’t be more correct. 

Trickle-down economics, I assumed, was a thing of the past. 

Yet, a few weeks after being appointed Prime Minister, Liz Truss seems to be embracing this flawed ideology with plans including lifting the cap on bankers’ bonuses.  

It is based on the theory that you must disproportionately favour wealthy people and businesses in the short-term in order to boost the standards of living for everyone in the long-term.

This is a disproved hypothesis, which has failed time and time again. The top 1% will do anything in their power to hoard wealth and profits – we simply cannot improve the lives of people across the country by giving more money to the wealthiest in society. 

At a time when people are experiencing a cost of living crisis, while big companies rake in excess profits, she has spectacularly misread the mood of the country. 

The Prime Minister has branded the move to lift the cap on bankers’ bonuses as a ‘difficult decision’ – so difficult, it seems, that she has done it within weeks of taking office.

Aside from the moral argument, we must also be clear that there is no link between high bonuses and increased performance. In 2014, the bailed-out Royal Bank of Scotland handed out £421million in bonuses despite seven consecutive years of losses.  

This decision exposes the Tories’ priorities. Truss said that ‘spurring economic growth may mean doing unpopular things’, which seems to be an admission that she simply doesn’t care what people think.

Before the notorious crash of the early late 2000s, bankers’ bonuses were spiralling, standing at £16billion in 2007. 

The current cap, introduced in 2014 following the crash, limits annual pay-outs to twice a banker’s salary, because everyone could see this pernicious culture was out of control.

Last year, Britain’s banks made £45.6billion in profits – they clearly aren’t being held back.

Sorry, this video isn't available any more.

Labour must be stronger in opposing this change, because it is not anti-business to be against excess corporate greed. The party must always be on the side of fairness for all. 

After all, it seems pay restraint is only for those on low-incomes, not for bankers. The Governor of the Bank of England has said that workers should not ask for big pay rises, while the Government refuses to give workers inflation-matching pay rises. 

The truth is, the Tory Government will continue to help their rich mates, leaving working people lacking support in desperate times. 

Boris Johnson, the liar-in-chief, was perhaps more skilled at hiding the true intentions of the Conservatives. 

Liz Truss has admitted herself that her tax cuts will disproportionately benefit the rich. She isn’t even trying to hide it! 

And, how could she? The Resolution Foundation says, on average, the richest 10th percentage of households will benefit from the Government’s cost-of-living living measures by about £4,700 a year, while the poorest 10th will receive just £2,200. 

We cannot forget that Truss was forced into a humiliating U-turn before even taking office, over her plans to cut civil service pay outside London. As Maya Angelou once said, ‘When people show you who they are, believe them the first time’. 

The true dividing lines are already clear. To tackle the energy crisis, Labour has consistently called for a windfall tax to tackle excess profits – but Truss would rather borrow more money on taxpayers’ backs.  

Her changes to stamp duty cut will only help people who can afford to buy a home – not get more people on the ladder. 

The facts show we have high levels of wealth inequality. The gap between the richest in society and the rest of the population has widened over a 10-year period, under successive Tory governments.  

It’s time to do things differently, with a focus on people before profit (Picture: Dan Kitwood/Getty Images)

This may be why the Treasury is refusing to publish the UK’s economic forecast alongside Friday’s mini-budget. 

Conservative Governments have a history of avoiding scrutiny, notably during the pandemic when they refused to publish full details of procurement contracts to Tory-linked businesses. 

These ‘growth boosting’ measures may possibly result in a temporary boost on paper, but if wealth is hoarded by the richest in society, it will be hollow. 

Under the Tories, it is working people who are creating the wealth in this country but only those at the top benefitting from it.  

Much like the Government’s energy price cap policy, which only kicks the can down the road and doesn’t address the core issue, I fear these measures are designed to distract people ahead of the next general election.

It’s time to do things differently, with a focus on people before profit. 

That must start with an extended windfall tax on the excess profits of energy companies so we can support the most vulnerable with their crippling bills. 

It must mean giving working people a real pay rise, because if we value people’s hard work properly, society will flourish, standards of living will improve, and crime rates will fall as the most vulnerable people in society will get the support they need. 

And it must mean protecting the hard-fought for right to strike. 

I wrote in my previous column that the Tories are not on the side of working people, that we would see more of the same failures under Liz Truss, and that she had the opportunity to prove me wrong. 

Well, with only weeks into her premiership, I’m afraid that I am already being proven correct. 

This Government, like the ones before it, cannot be trusted – it’s time for real change with Labour.

Do you have a story you’d like to share? Get in touch by emailing [email protected]

Share your views in the comments below.

MORE : Dawn Butler: ‘I had no symptoms when I was diagnosed with breast cancer’

MORE : If the Tories are so confident in their government, why can’t we have a general election?

MORE : Good riddance to Boris Johnson – he’s left a legacy of sleaze in Parliament