IEA Director General responds to Kwasi Kwartengs conference speech

Mark Littlewood, Director General at free market think tank the Institute of Economic Affairs responds to Kwasi Kwarteng's conference speech

The Chancellor is right that there is a need for radical reform to jumpstart our economic growth - a tax-cutting, supply-side reforming agenda will be essential to boosting Britain's prosperity.

The abolition of the 45p rate would have made economic sense. It raises very little, if any, revenue, and is an unnecessary complication in the tax system. However, the government has decided for reasons of political optics to reverse its position on this tax. We therefore run the risk of continuing to have a tax system designed to send an appropriate political message rather than based on sound economic reasoning.

The government now needs to spell out its agenda for regulatory reform - from housing and childcare to financial services and retained EU law. The Chancellor emphasised the importance of fiscal discipline. He must now find meaningful areas for spending restraint in a difficult fiscal position.

Notes to editors

IEA spokespeople are available for interview and further comment.

The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems. The IEA is a registered educational charity and independent of all political parties.