Read: the new Chancellor's interview with the BBC

6 July 2022

8:27 PM

6 July 2022

8:27 PM

This is an edited transcript of the interview with the new chancellor Nadhim Zahawi on the Today programme this morning.

Nick Robinson: You faced a choice yesterday, and I’d like you to explain it to our listeners. Why was it in the country’s interests as against yours, for you to stay in the cabinet and not to follow Rishi Sunak and Sajid Javid?

Nadhim Zahawi: Because we are facing a global battle against inflation. Inflation is raging here in the United Kingdom, in Germany, in Canada and the United States. We have war on our continent that very few people anticipated. And I think many, many people listening to this programme today are struggling with their weekly shop and with their utility bills. Today’s the first and the biggest personal tax cut in a decade, which I think is an important message to the country.

NR: I’m asking you why you didn’t resign. Do you not agree with your predecessor, Rishi Sunak, who said the public rightly expect the government to be conducted properly, competently and seriously? Do you not agree with the former health secretary, Sajid Javid, who says people rightly expect integrity from their government?

NZ: Last night the Prime Minister went on television and apologised and explained that with the benefit of hindsight, he shouldn’t have appointed Chris Pincher to the role of deputy chief whip. We make decisions at warp speed. You know that, Nick, you’ve been around politics for a very long time. We don’t get every decision right.

NR: It is about telling the truth, Chancellor. On Monday, when you were asked about this Conservative MP promoted by the Prime Minister, despite the fact we now know that Boris Johnson knew about Chris Pincher’s past inappropriate behaviour to staff and colleagues: you said, ‘I think on the specific allegations the Prime Minister did not know that was not true’. Was it?

NZ: So when I said the specific allegations, it was the incident that took place at the Carlton Club which the Prime Minster didn’t know. He heard about it. He was then informed that there’s been a formal complaint, which is when he took the decision to remove the whip.

NR: Are you not in danger of doing precisely what Lord McDonald said on this programme yesterday, giving us sort of the truth while crossing your fingers and hoping for the best. Why don’t you clear this up? Everything ministers have told us since this story broke day after day was not true because that’s what you were told to say by No. 10. And it was not until a former senior civil servant had the courage to say so that the Prime Minister then had to admit it.

NZ: Well, first of all, Lord McDonald’s point was investigated at the Foreign Office and of course was resolved by the Prime Minister last night. He apologised for making the mistake. And of course with the benefit of hindsight, he shouldn’t have appointed Chris Pincher, as he said. I think actually in my view that’s good leadership. If you come out and say, look, I made a mistake, I make decisions every day at warp speed, I don’t get all the decisions right.

NR: Mr. Zahawi, we’re not talking about his decision. We’re talking about whether he tells the truth. Rishi Sunak resigned. The only reason you are Chancellor this morning is because Mr Sunak has told the public that you cannot expect this government to behave competently and seriously and properly. I am asking you whether you told the truth and whether Boris Johnson told the truth. And the simple answer is, you didn’t and he didn’t.

NR: Well, all I would say to you is, to the best of my knowledge, I told the truth that’s what I knew: the specific allegations against Chris Pincher when the Prime Minister was informed about them and told that there was a formal complaint. He took action. The Prime Minister last night apologised and said, look, with the benefit of hindsight I made a mistake and I am sorry. Look, we’ve got a big challenge to deliver to rebuild the economy and grow the economy. We’ve got a war raging on our continent.

NR: So let’s come to the economy in just a second. Before we do here, let’s talk about him for a second.

NZ: The people egging us on to turn on one another are people like Alastair Campbell and in my view, wherever Alastair Campbell is, any Conservative should be on the other side of the argument.

NR: He was talking about the resignation of senior Conservatives. It is frankly insulting for you to suggest that this is a crisis created by your political opponents. It is created by what the Times editorial today calls Mr. Johnson’s ‘serial dishonesty’. Let me just play you what the Prime Minister said to Mishal on this program ten days ago:

If you’re saying you want you want me to undergo some sort of psychological transformation, you know, I think that our listeners would know that is not going to happen.

NR: So to translate, is your message to Conservatives this morning he’s not going to change, like it or lump it?

NZ: My message to Conservatives this morning is that in my meeting with the Prime Minister last night, it was very clear that he wants us to focus on delivery, delivery, delivery. We’ve got to rebuild the economy and return to growth of the economy. That’s my focus. Today is the biggest personal tax cut in ten year: £330 for 30 million people. That’s the help we’re putting in to help those families who really need that help today. Divided teams do not attract votes. That’s all I can say to to to my colleagues. We’ve got to unite and deliver.

NR: And let’s focus on what you want to focus on the economy. There is a link between telling the truth and dealing with the economic challenges we face. You need to tell people the truth, don’t you? Yesterday on Radio 4 on PM, Nick Gibbs said that people need to know if you’re taking hard decisions. Their decisions in their interests are not decisions designed to shore up the Prime Minister. How can we be sure that what you are telling us on any particular day is true?

NZ: Because I’ve demonstrated it, as has the Prime Minister. Let me give you an example. Evidence and transparency is what delivered the vaccine programme. The Prime Minister was absolutely determined to share data every single day. The system wasn’t set up to do daily data, you know. Remember, we only do data on Thursdays and you have to wait a week before you get the data. That data allows you to focus on where the gaps in the vaccine programme were. I was told, you know minister, you say your vaccine programme is brilliant, but look at Tottenham. Black and Afro-Caribbean men are just not getting vaccinated. Evidence and transparency is what you’re going to see from this team, from this Prime Minister. The nation got used to seeing data and evidence. This Prime Minister will continue to lead on that evidence-based reform of the economy. Evidence and data and transparency is our ally in reforming complex systems like health, like education. And that’s what we will do, and I will share that with you. I’ll come on your programme and share the evidence and defend it.

GettyImages-1241728807.jpgChancellor Nadhim Zahawi arrives at the Treasury to start his new job (Getty Images)

NR: Let’s talk about the evidence on tax data: evidence and transparency. You said several times in this interview you’ve been very keen to talk about what you call a tax cut today. Can we be clear that the data, the evidence, the transparent truth is taxes are going up. They are at a record high under this government. They will be higher when you face the electorate, whatever you do as Chancellor. in the next year or two. Why not tell people the truth? Tough times demand high taxes. That’s what we’ve got.

NZ: I opened by saying to you that my task is to rebuild the economy and return to growth. We’ve had good growth this year, the second highest growth in the G7. And of course, good growth is forecast for 2024. But 2023 is going to be really hard for us. I described that in my earlier remarks, but of course I will continue to share that evidence. I want to make sure we bear down on inflation. We’ve had a £470bn input to help the economy and people’s livelihoods and life to get through the pandemic. We’ve just come out of the equivalent of a world war. We have to rebuild the economy and return to growth. That’s what your listeners will want me to focus on. So it’s my first day in the job, Nick, and I need to be able to just make sure I go back and review everything. Nothing is off the table. I’ll come back on your programme and happily talk about where I think we can do more on taxes. We are determined to do that, as was my predecessor. He was determined to do that on personal taxation and of course on other taxes as well.

NR: You quote your predecessor. He said there was a fundamentally different approach between him and Boris Johnson on the economy. The Prime Minister feels like he’s got a moment of liberation. He can now unleash sweeping tax cuts. You’re described as just the adventurous and buccaneering Chancellor the country needs. So policy will change under Nadhim Zahawi at No. 11?

NZ: I will review everything. I will be the evidence-led Chancellor. And of course, my priority is to bear down on inflation. We know that if you let inflation get out of control and be rapid, it will hurt those those families that really need that help. And of course, I’ll happily come back on your programme and share that evidence. My job is to rebuild the economy.

NR: But just be clear on what you’ve said to return to growth. There is a perfectly good economic argument that says you can’t afford tax cuts during a period of inflation because it stokes it. There is another view that says tax cuts get the economy growing again. Rishi Sunak believed the first. Have you been appointed because you believe the second: that tax cuts are needed to grow the economy?

NZ: No, I’ve been appointed because I’ll be evidence-led and my focus is to rebuild the economy and then return to growth. That’s the important thing for this Chancellor and I’m determined to deliver and I will happily come back on your programme. This is my first day in the job. I want to get a really good handle.

NR: You don’t want to say too much because you’re new in the job, I understand that. One thing you have said very clearly in your old job as Education Secretary: you called for a 9 per cent pay rise for the newest teachers. Now that you are the Chancellor, can teachers safely assume that you will write the cheque for that pay rise?

NZ: We made a pledge in our manifesto that the starting salary of teachers will rise to £30,000. That 9 per cent rise is what I have advised the pay review bodies that I need to do: and 7.7% for next year to get that starting salary to £30,000 that I had agreed during the spending review. So I’m not going out of my spending envelope and I’m recommending 5 per cent over two years for senior teachers when I was actually Secretary of State for Education. I will look at the evidence from the pay review bodies and we will make a collective decision as a government. The important thing is fiscal discipline. That is what we’ve got to do because we’ve got to bear down on the blight of inflation: fiscal discipline.

NR: Now, let me talk about you. You and I have talked in the past about the extraordinary moment when you watched your father, an enemy of Saddam Hussein, on a plane trying to flee Baghdad as the secret police marched up the steps. You thought he was going to be arrested and taken away. Can you believe that that boy from Baghdad is now the Chancellor of the Exchequer in the UK?

NZ: I’m going to well up in a minute, Nick. I pinch myself every morning to wake up to think the 11-year-old who arrived on these shores and couldn’t speak a word of English is now the Member for Shakespeare for the heart of England and the Chancellor of the Exchequer in Her Majesty’s Government. This is the greatest country on earth, Nick.

NR: The problem, though, is this, and we heard it earlier on the programme. The chair of the International Chambers of Commerce, Paul Dressler, said something rather similar to you. But then he went on to say, it took centuries to build a fantastic reputation for this country. We are being laughed at around the world. It’s got to stop. Is he right?

NZ: That’s true. I was in Qatar for the Platinum Jubilee. I signed a memorandum of understanding on education, an MOU with the Qatari government. I was on the Foreign Affairs Select Committee for many years. This country is a beacon of freedom and opportunity for the rest of the world. And it will long continue under this Prime Minister and this Chancellor.

NR: As we’ve been speaking, there has been another resignation. Laura Trott, who is a PPS, has resigned. Trust, she says, in politics is and must always be of the utmost importance. Sadly, in recent months this has been lost. What do you say to her and to other Conservatives who think it is over?

NZ: I’m sorry to lose any Conservative, but of course sorry to lose a talented Member of Parliament like Laura Trott. What I would say to her is the way you deliver trust is by delivering outcomes for people. They want to see us focus on the economy and stewardship of the economy, rebuilding the economy, growing the economy and on national security abroad. We’ve got war raging on our continent and of course, at home, 13,500 police officers are recruited. And of course, the backlog that Steve Barclay will deal with in the NHS and skills: there is a huge ambition to make T-levels as famous as A-levels.

NR: Mr. Zahawi, forgive me for interrupting you. The man who came on this programme on Monday morning to defend the Prime Minister has just resigned. Will Quince, the Education Minister, a minister in the department you left yesterday. It’s over, Mr Zahawi, isn’t it?

NZ: I’m sorry to see Will Quince go. He was my Children and Families Minister and a great minister. All I would say to colleagues is people don’t vote for divided teams.

NR: Mr Quince – in good faith – came on this programme and repeated what he was told by No. 10. They were repeating what they were told by the Prime Minister. It turned out not to be true. Is your claim this morning to your colleagues who disagree with you: it doesn’t matter whether we tell the truth?

NZ: No, what I’m saying is we make decisions at warp speed. We don’t always get them right. We make mistakes. The Prime Minister came out last night and said, I made a mistake and I am sorry and I am equally sorry to see colleagues leave government and I want us to unite and deliver for the country. There are no easy options. Every morning we wake up, we make hard decisions. What is a priority for your listeners, for the country, is that we continue to deliver that economic stewardship, rebuild the economy and grow it. And of course, all the other things that you and I have been discussing, whether it be national security abroad or at home or the backlog in the NHS. I am deeply sorry to see colleagues leave government, but I am determined to make sure we continue to focus on delivery.

NR: Nadhim Zahawi, the new Chancellor of the Exchequer, thank you very much indeed.

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