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02nd Oct 2022

Kwasi Kwarteng drank Champagne with hedge fund managers after mini-budget

Jack Peat

Treasury source refutes Kwasi Kwarteng's comments on energy support package

The guests allegedly congratulated the chancellor and told him to ‘double down’

Kwasi Kwarteng reportedly quaffed Champagne with hedge fund managers after delivering his disastrous mini-budget last week.

The Chancellor has come under fire after his tax-cutting policies sent markets into a downward spiral, pushed the pound to record lows and threatened the liquidity of pension funds.

Several hedge funds are believed to have profited handsomely from the moves through ‘short’ positions on sterling and government debt.

Prominent Brexiteer Crispin Odey, who once employed Kwarteng to work on his fund, was said to be up 145 per cent on the back of bets against government debt.

The fund manages £4 billion in assets and has significant exposure to bets against very long-dated bonds, some as far out as 2071.

It has since been revealed that Kwarteng attended an event at the west London home of Andrew Law, a financier, on the evening of Friday 23 September, where he divulged information about forthcoming government spending cuts.

The chancellor is said to have told attenders at the reception of austerity-style budget cuts to come while guests drank wine, champagne and cocktails as they 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 said Kwarteng described that 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 told the Sunday Times that Kwarteng attended the gathering at Law’s home, which was arranged by the Conservative party’s campaign headquarters, for an hour to talk through his mini-budget plans and gave a five-minute speech.

The Liberal Democrat Treasury spokeswoman, Sarah Olney, said: “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.”

The Treasury has been approached for comment.

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