The Conservative party chair has defended the chancellor, Kwasi Kwarteng, and said that people who attended a private champagne reception with him on the day he delivered his mini-budget should be “lauded” as Britain’s leading entrepreneurs. Jake Berry said the drinks reception was not unusual and that, along with hedge fund managers, property developers had also been present. He said: “These people should be lauded because we don’t have public funding of political parties and these are people who go out and make money and donate to political parties,” he told Sky News’s Sophy Ridge on Sunday. “It wasn’t a get-together of hedge fund managers, it was Britain’s leading entrepreneurs. Yes, I was there, but it’s the normal drumbeat of treasurer’s events that we have all the time.” Asked if hedge fund managers had been there, Berry said he was “sure there were” but that he had had conversations with people who worked in the property industry. The chancellor is alleged to have given guests information about forthcoming government spending cuts during the event at the west London home of Andrew Law, a financier, on the evening of Friday 23 September.
Kwarteng’s mini-budget earlier in the day, which introduced a £45bn package of tax cuts that will mostly benefit the richest fifth of households, triggered economic turmoil. Sterling collapsed to its lowest level against the dollar since 1985 and the Bank of England was forced to act to save pension funds. Berry said: “They were all saying they back this government’s drive to create growth in the economy because they understand you cannot have a rising tide of prosperity that flows under every door in this country without having growth in the economy.” The chancellor is said to have told attendees at the reception of austerity-style budget cuts to come. The guests drank wine, champagne and cocktails and congratulated him on the measures announced in the House of Commons, according to the Sunday Times. A source told the newspaper: “He wanted to give an unadulterated message of ‘growth, growth, growth’, and that’s why he didn’t talk about savings, because otherwise the [news] agenda would have been all about savings – ‘Where will you cut? What will you cut? Blah blah blah.’ They’re fully aware they have to make savings.” Two sources told the Sunday Times Kwarteng described the day as a “great day for freedom”. Another said guests told Kwarteng to “double down” – an approach from which some stood to make profits. Tory officials said the gathering at Law’s home had been arranged by the Conservative party’s campaign headquarters and that Kwarteng had spoken for an hour to talk through his mini-budget plans. The Liberal Democrat Treasury spokeswoman, Sarah Olney, said there should be an inquiry into what Kwarteng told donors. “While struggling homeowners saw their mortgage bills spiral, it seems the chancellor was sipping champagne with hedge fund managers profiting from the falling pound. How out of touch can you get? We need an official inquiry into this now.” Senior Labour MP Angela Eagle also said the matter needed investigating, calling it “utterly improper or worse”. A source close to the chancellor said: “Any suggestion attendees had access to privileged information is total nonsense. “The growth plan [published earlier that day] included a commitment to review our tax code to make it simpler, better for families and more pro-growth. The government’s ambitions on lowering the tax burden are hardly a state secret.” Kwarteng has said he will set out further details of his economic strategy when he publishes his medium-term fiscal plan on 23 November. But the Treasury select committee, made up of MPs from all parties, has demanded that he release a full economic forecast from the Office for Budget Responsibility by the end of October.