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Isa Soares Tonight
New U.K. Prime Minister Takes Office; IAEA Nuclear Experts Say They're "Gravely Concerned" About Ukraine Nuclear Plant; Liz Truss Becomes New British Prime Minister, Unveils Cabinet Picks; Canada Stabbing Suspect Found Dead, Another On The Run. Aired 2-3p ET
Aired September 06, 2022 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[14:00:00]
ISA SOARES, HOST, ISA SOARES TONIGHT: A very warm welcome to the show, everyone, I'm Isa Soares. Tonight --
(BEGIN VIDEO CLIP)
LIZ TRUSS, PRIME MINISTER, BRITAIN: As strong as the storm may be, I know that the British people are stronger.
(END VIDEO CLIP)
SOARES: Liz Truss takes the helm in rough waters as the U.K. faces a slew of challenges from the war in Ukraine to skyrocketing inflation. As Truss
calls the economy her top priority, I speak to one single mom feeling the brunt of Britain's economic crisis. And nuclear experts who have just
finished inspecting the Zaporizhzhia nuclear power plant say they are gravely concerned. Details from their new report ahead.
Good evening, everyone, it's 7 O'clock here in London on the -- coming to you live from outside the houses of parliament. The U.K.'s newest prime
minister is just hours into the job, and Liz Truss says she's doing -- she's going to really hit the ground running to help turn Britain into a
quote, "aspiration nation". Her words.
She's stepping into the premiership as the country faces really a daunting set of crises. In her first speech in office, Miss Truss laid out her first
priorities. That's promising sharp tax cuts and reforms to grow the British economy. Saying this week, she will get hands-on with soaring energy costs
and pledging support to struggling National Health Service. Liz Truss says she and the country are up for the job. Have a listen.
(BEGIN VIDEO CLIP)
TRUSS: Now is the time to tackle the issues that are holding Britain back. We need to build roads, homes and Broadband faster. We need more
investments and great jobs in every town and city across our country. We need to reduce the burden on families and help people get on in life. I
know that we have what it takes to tackle those challenges.
(END VIDEO CLIP)
SOARES: And there is no honeymoon period here. Nina dos Santos joins me now live from 10 Downing Street. And Nina, she has to hit the ground
running, really, to try and deliver on all these pledges we heard today from Liz Truss outside 10 Downing Street.
NINA DOS SANTOS, CNN CORRESPONDENT: Yes, she does. And remember, this is a major departure from the previous prescription of government that various
Tory prime ministers, that's short for conservative prime ministers, have prescribed for this country over the last 12 years that this party has been
in power. So, there's big skepticism about whether or not she really should engage in such a departure from form without going to the polls and getting
a fresh mandate from the people.
Indeed, recent polls suggest that perhaps more than half of the British electorate according to a specific survey conducted earlier today think
that she should take the country to a polls before the end of the year. That is unlikely to happen. She's already more or less indicated yesterday
that she doesn't want to call any fresh elections.
If you look at how the Conservative Party is polling against its opposition Labor Party, obviously, it is not looking favorable and it doesn't look as
though they'd win an election at the moment. But let's see what she has to offer because she's promised to, quote, unquote, "deliver", but she hasn't
yet offered that many details so far.
What she will be having to do, though, is set out her cabinet from day one. And we've already seen indications of that. We've seen in the last two
hours, big departures from the front benches of Boris Johnson's stalwarts and people who supported Rishi Sunak. So, the Transport Secretary is gone,
the Justice Secretary is gone, so on and so forth, and the Home Secretary, of course, Priti Patel left yesterday evening.
And just in the last few minutes, we've also seen a raft of people who have been mooted to take the biggest cabinet jobs in the land arrive here for
potentially their official appointment. So that their first announcement so far, Therese Coffey who used to be -- work in pensions as secretary under
the previous government, she has now been given the brief as health secretary and also deputy prime minister as well.
A big ally of Liz Truss. In fact, you saw her here next to me a couple of hours ago when Liz Truss walked through the doors of Downing Street with
the whole team, she was very much in charge. So, she is also going to be the deputy prime minister, but we saw Kwasi Kwarteng the looted chancellor
of the Exchequer, the man who is expected to take the steering of the big financial burden that this government is going to have to try and share
with the people.
He was one of the first people to arrive about an hour ago through the front door. Also James Cleverly who's been rumored to become the new
foreign secretary, taking over from Liz Truss herself. She's now become the third female PM that this country has ever had, Isa.
[14:05:00]
SOARES: Yes, a bit of a rotating door, of course, as we await to find out what that cabinet will look like, Nina. And of course, so much has happened
in the last -- well, just in the last 10 hours because earlier this morning, of course, right where you are, you heard -- we heard from the
outgoing, of course, Prime Minister Boris Johnson. What did you make of the way he characterized, Nina, his time in office?
DOS SANTOS: Well, characteristically, he talked about his accomplishments. He stressed very much that they managed to get most of what he believed he
set out to be done in the limited time that he had. Indeed, he said that it was a little bit like a relay race being a conservative prime minister
these days.
You had to hand the baton to somebody else, in this case, he more or less said, well, we've had to do that a bit earlier than expected. But, you
know, those are the rules of the game. He didn't acknowledge the failures that had brought the Conservative Party to these unpopular levels.
In particular, I'm talking about the scandal surrounding -- endless scandal, by the way, surrounding those allegations of parties being held in
Downing Street by the very people who were drafting the lockdown legislation that was keeping everybody else behind closed doors, and
keeping families separate at a really difficult time for this country.
And so, Liz Truss obviously trying to depart, leave all that behind, perhaps even leave behind some of the culture wars and focus on -- heavy
focus on things like immigration post-Brexit, that the previous government has been known for. Instead, she's made it clear she wants to focus on
growth and put forward this ambitious plan to support people's finances in the short term.
The question is whether or not she can deliver on that and stave off a recession when a recession may be looming for everyone else in the world.
SOARES: Yes, that is indeed the question, and she's got a lot on her plate, that is for sure. Nina dos Santos outside 10 Downing Street, I know
you're keeping on top of that door as we hear -- wait to hear news on the cabinet. Thanks very much, Nina. Well, let's discuss a myriad, really, of
challenges Liz Truss has on her plate. Joining me now is someone who's been advising her, Gerard Lyons is the chief economic strategist at Netwealth.
Gerard, thank you very much for being here.
GERARD LYONS, CHIEF ECONOMIC STRATEGIST, NETWEALTH : Good evening --
SOARES: She promised a lot.
(LAUGHTER)
LYONS: Yes.
SOARES: Can she deliver?
LYONS: Well, I think so. And she -- not only is she quite positive about the outlook, very importantly, she's very realistic, realistic about the
near-term challenges. So, she's already highlighted, as you've mentioned, the three big issues.
SOARES: Yes --
LYONS: Energy, the economy and health. In terms of the energy situation, it's likely in the next few days, that we will progress from the current
Johnson or the previous Johnson administrations were targeted, help was provided, but the price was still allowed to rise, to now actually capping
the price, and actually funding this largely through longer-term borrowing.
I think people will see that as a positive, both in terms if the general public confirms. And very importantly, I think the markets will take it as
a positive that finally someone is really trying to get on top of this energy crisis.
SOARES: Yes --
LYONS: But then on top of that it's about the economy.
SOARES: Yes, and on the markets, we have seen sterling down somewhat, I think almost down four decades -- a little bit close, more than four
decades against the dollar. This is prior of course to --
LYONS: Yes --
SOARES: To hearing from Liz Truss today, and concerns about bond yields and so forth. Because the concern comes out, how is she going to fund all
this? And will that impact Gerard, of course, a borrowing costs?
LYONS: Well, in terms of the currency, it's primarily a dollar strength story. The yen, for instance, is probably down at its lowest level since
the late '90s, today as well. Bond shields have risen quite significantly across western Europe. But obviously here in the U.K., partly because of
worries about inflation.
In terms of the borrowing, I think what's important is that the Truss campaign and the Truss administration really wants to have a monetary
policy set by the Bank of England, Bank of England that's independent, getting on top of inflation, and fiscal policy basically stabilizing the
economy.
But in terms of funding it, one has to remember that U.K. debt is twice the length of majority of, say, German debt. So, it's relatively easier for the
U.K. when it really sets out its strategy to borrow. Of course, what's uncertain for the markets in recent weeks has been that strategy. So --
SOARES: Yes --
LYONS: My feeling is once the strategy starts to be unveiled, and that will basically be over the next few weeks. It's both what they say in terms
of the new government and what they do.
SOARES: Very much. At this point is very much what they say and what they do. Can you provide us with any nuggets in terms of what she may announce
on Thursday? Because she said she might announce it this week, where she stood outside 10 Downing Street. In terms of tackling the energy crisis --
LYONS: Yes --
SOARES: What kind of package will we be looking at here, Gerard, do you think?
LYONS: Well, I'm not involved in the final detail of this. I was writing in the Sunday papers about the fact that she was likely, in my view, to cap
wholesale energy prices. The important thing is that is to provide a cap, in the sense that prices now are so astronomically high that people in
firms are starting to adjust their behavior, cutting back, so conserving energy.
But there was nothing to benefit the economy from prices being allowed to go any higher. So, what we're likely to see on Thursday is the government
saying we are taking the risk, risk of the general public, and particularly of firms, and that we're going to cap prices --
[14:10:00]
SOARES: How long? How long do you think she will --
LYONS: I don't know on that part.
SOARES: Yes --
LYONS: There's lots of speculation. I think it makes sense to think about the next two Winters --
SOARES: Yes --
LYONS: Given this Winter and also next Winter. That's 18 months. In terms of borrowing, I think coming back to this point, because this is very key,
fiscal easing --
SOARES: Yes --
LYONS: Is necessary to prevent a deep recession. It's non-inflationary, because of the nature of our inflation shock.
SOARES: Yes --
LYONS: Our inflation shock is caused by supply-side factors and by inappropriate monetary policy, not as in the past and overheating the
economy, domestic months.
SOARES: We're --
LYONS: Also, it's affordable as well, that's the key thing. Bond yields are now up to 3.1 percent, which is a ten-year high.
SOARES: But I think on that, everything you're outlining here --
LYONS: Yes --
SOARES: It's clear that, you know, the markets understand the picture. But they need the details --
LYONS: Yes --
SOARES: They need the details exactly, right?
LYONS: Oh, I completely agree --
SOARES: How is she going to do this? Because that is why I think we've seen a bit of volatility when it comes --
LYONS: Yes --
SOARES: To yields, right? Would you agree?
LYONS: I've been in the markets 30 years, and other --
SOARES: So --
LYONS: People also giving their advice to Liz Truss are market experts. So they clearly -- the prime minister and the new chancellor, whoever he may
be, likely it'd be Kwasi Kwarteng fully know that there are three target audiences here. There's the general public. Naturally, they're politicians.
There is the private sector in terms of business --
SOARES: Yes --
LYONS: And investors, and then there's the markets. Now, in terms of the market, it's three different aspects here. One, it's the energy price cap
on Thursday. Tomorrow, it's likely to be a focus on making sure that people understand the Bank of England is independent, and the Bank of England is
going to get on top of inflation.
And third, it's -- in two weeks time or maybe next week, it's the so-called fiscal event. People might have to wait a while for that, but it's only one
week, maybe two weeks. And the fiscal event is very much about the fact that the U.K. was the only G7 country that was tightening policy, raising
taxes into a global downturn.
So, by reversing those planned tax increases and by actually cutting taxes further, we should rule out a deep recession, maybe prevent a recession
completely. If there is one, like with other countries --
SOARES: Yes --
LYONS: Hopefully, it will only be short and shallow. Remember, the jobs market here is very good. But coming out with your question, the markets, I
won't say center stage, they're alongside the public and the private sector. The markets are very high up there on their schedule of keeping
people on-side.
SOARES: And very briefly, we saw a video of Kwasi Kwarteng going in --
LYONS: Yes --
SOARES: To 10 Downing Street. He is expected, at least the media has been speculating --
LYONS: Yes --
SOARES: He's expected to be the next chancellor. How do you think he will handle and manage this huge task, it's a huge challenge here?
LYONS: Right, we're changing the mindset here. The U.K. has been a low growth, low-wage, low productivity economy. We can't change that overnight.
But the key thing is to have fiscal discipline, but to actually use fiscal policy not to tax people more, but to stabilize the economy. And as he was
saying in the comments, in the paper on Monday --
SOARES: "The Financial Times" --
LYONS: It's about --
SOARES: Yes --
LYONS: Going for growth. It doesn't mean go for growth and put the country and the fiscal finances at risk. It's about having a sense of disciplined
approach that prevents the economy going to a recession. It starts to turn the economy around, and I think in terms of the markets, people will
actually be reassured, I would expect by what they hear not just this week, but in the next two weeks, and then it's about delivering on that.
SOARES: Absolutely. Let's have a look, he definitely has a huge in trail alongside --
LYONS: Absolutely --
SOARES: Liz Truss --
LYONS: Which may be --
SOARES: But right now, he's seen delivering, of course, on that -- on that package of measures that --
LYONS: Yes --
SOARES: The country is waiting for. Gerard Lyons, always great to have you on the show --
LYONS: Yes, lovely to see you, take care --
SOARES: Thank you very much. Thank you very much. Well, the U.N.'s nuclear watchdog is calling for a security zone around Ukraine's Zaporizhzhia
nuclear power plant, saying there is an urgent need for measures to prevent a nuclear accident. The IAEA issued a report today after its visit to the
Russian-occupied complex saying, it is gravely concerned.
It says, inspectors witnessed damage from shelling attacks. Some of it close to the reactors cooling, fighting in the area a constant threat to
nuclear safety. The IAEA's chief spoke to CNN's Christiane Amanpour a short time ago. Have a listen.
(BEGIN VIDEO CLIP)
RAFAEL GROSSI, DIRECTOR-GENERAL, INTERNATIONAL ATOMIC ENERGY AGENCY: At the moment, what is urgently needed now, today, is that we agree on
establishing a protection, if you want, a shield, a bubble around the perimeter of the facility. This is not something which is impossible to do.
Not at all.
So, the IAEA has the mandate to protect the safety and the security of the plant, has its people there, and I hope -- and this is what I put in my
report, that I will be able to consult very quickly and establish this as an interim measure, if you want. And I am calling it that, in my report, in
the hope that there will be further things. But let not the best be the enemy of the necessary.
(END VIDEO CLIP)
[14:15:00]
SOARES: Well, Ukraine's military, meanwhile, says it has repelled several Russian offenses in the eastern Donetsk region. It's also reporting new
progress in a counteroffensive on the southern front. Our Sam Kiley is live in Odessa with more. And Sam, has there been any change in this front line?
Because we've seen Russian forces continue to shell these towns and villages in the region.
SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, the Ukrainians are saying as of yesterday, certainly, President Zelenskyy saying that a
couple more villages were captured. As you say in the intro there, they're also talking about repelling attacks in the east. These are kind of micro
levels, Isa, of movement on a 1,500 kilometer front line.
If you look at the southern offensive though, the energy and the initiative remains with the Ukrainians. That is something that the Russians have
effectively been admitting. The Ukrainians also saying to their population in Kherson, which is the -- at least in the short term, the main target to
recapture that regional capital taken in the early days of the war from the Russians, telling the local population to get underground.
But all of this is being complicated by -- to some extent what's been going on in Zaporizhzhia, which could, itself, become the center of yet more
fighting. It's already been used as a fire base by the Russians. And of course, the IAEA now asking for it to become a secured zone. I think,
really interesting there is they're not using the term demilitarize.
In other words, they're leaving a bit of wiggle room for the Russians to perhaps leave their military there, but somehow not use military there.
That's not going to satisfy the Ukrainians and probably not satisfy the international community, Isa.
SOARES: And I believe that you've been speaking to soldiers who are part of this offensive, who clearly, like you just outlined, it's going to be a
slow and long grind. What have they been telling you, Sam?
KILEY: Well, Isa, they do talk about how this is not going to be a lightning offensive, but a long and slow grind, and this is our exclusive
report.
(BEGIN VIDEOTAPE)
(GUNFIRE)
UNIDENTIFIED MALE: Marago (ph), go! No panic! No panic! It is normal. It is normal.
KILEY (voice-over): Among the most forward troops in Ukraine's latest counteroffensive, this really is normal. When the crunch of incoming
artillery is this intense --
UNIDENTIFIED MALE: Guys --
KILEY: Casualties in this reconnaissance unit, which includes three foreigners, are inevitable. Mark Ayres is a Briton, was lightly wounded on
day one of the offensive.
(GUNFIRE)
On day two, he was more seriously injured in the leg by artillery, alongside Michael Zaffer (ph); a former U.S. Marine from Kansas. He was hit
in the hand, stomach and head. They joined Ukraine's army together, but met fighting ISIS in Syria. Zaffer (ph) is the former U.S. Marine's Kurdish
code name.
UNIDENTIFIED MALE: I am fine, go.
KILEY: As recce troops, they've been the tip of Ukraine's attacks on its southern front in the fight to recapture Kherson.
UNIDENTIFIED MALE: And then I just remember looking up to my left, and then pop, I couldn't see anything for a bit. Everything looked the same,
everything came to, looked at my left, it looks fine, looked at my right, OK, I'm -- there, I'm -- there, right? To the hole, to the whole.
KILEY: It's going to be a slow, grinding fight, they say, whatever the claims of Ukraine's government.
(on camera): This counteroffensive is being billed as kind of a quick process. Do you think that that's --
MARK AYRES, BRITON FIGHTING IN UKRAINE: No, definitely not. It won't be quick. I mean it's hard, slow fought, meter by meter, position by position.
Because we haven't got the resources to do a massive blitzkrieg.
KILEY (voice-over): U.S. weapons and other NATO equipment have proved useful, but not decisive, as Ukraine has captured a handful of villages
since the counteroffensive began. Here, Russian troops wave a white flag of surrender. Precision artillery strikes by U.S.-supplied howitzers are
monitored by Zaffer(ph) recce unit with a drone.
Russia motivated its troops with false claims that they're liberating Ukraine from Nazis. For Ukraine, it's a battle of national survival,
attracting help from around the world.
(on camera): Do you feel sorry for the Russians?
AYRES: No, not at all. It's not like Ukraine has invaded Russia. They've invaded Ukraine, and they're here killing civilians, killing our soldiers.
I've got no sympathy for them, whatsoever.
KILEY (voice-over): Ukraine has imposed a news blackout on the southern offensive and keeps its casualty figures secret. But for these men, being
wounded isn't the end of combat. It's an interruption.
(on camera): And are you going to go back?
UNIDENTIFIED MALE: Yes, once everything heals on my body, probably within 3 to 4 weeks, so, I should be right back out there.
(END VIDEOTAPE)
[14:20:00]
KILEY: Now, Isa, one of the really important aspects of this new offensive have been these new NATO weapons, which are more precise. They're not more
powerful and they are heavily outgunned, numerically. And the issue is really going to be how quickly can the Russians get reinforcements and
resupply in, which is why, of course, the Ukrainians have been attacking the main bridge into Kherson from the other side of the Dnipro River, which
is the main route of supply for the Russians there, Isa.
SOARES: Sam Kiley for us in Odessa this hour, thanks very much, Sam. Appreciate it. Well, flooding in Pakistan grows ever more disastrous and
overflowing lake, food scarcity and now fears of infectious disease. We'll have a full report just ahead right here on CNN.
(COMMERCIAL BREAK)
SOARES: Now, Pakistan's largest freshwater lake has unexpectedly over flown its banks. This puts thousands more villages at risk of flooding, as
the nation continues to reel from an unprecedented monsoon disaster. Food there is now in short supply and the aid agencies are warning about an
uptick of infectious diseases. Here's CNN's Anna Coren with the very latest for you.
(BEGIN VIDEOTAPE)
ANNA COREN, CNN CORRESPONDENT (voice-over): Stretching to the horizon and beyond, an expanse of endless brown murky water dotted with tops of trees
and roofs of houses. Never before has Pakistan seen the scale of flooding as water now covers one-third of the country.
These climate change-induced disaster has been months in the making with more than double the amount of rain falling since May, in what the U.N. has
referred to as a monsoon on steroids. Last month's deluge unleashing even more misery as violent torrents of waters dismantled townships, homes and
crops. The sheer volume unable to drain away.
CHRIS KAYE, PAKISTAN COUNTRY DIRECTOR, WORLD FOOD PROGRAM: Hundreds of thousands of families now have absolutely nothing. The land where they had
their houses is totally flooded. They don't have anything more than what they're wearing.
COREN: Thirty three million people have been affected. That's around 15 percent of Pakistan's population. More than 600,000 people have moved into
displaced persons camp. But some of the most vulnerable have been left stranded.
[14:25:00]
On this tiny strip of land are a number of families, their surviving livestock, a few belongings and 24-day-old Shumami(ph). Her mother,
Kenat(ph) is sick, exhausted and struggling to care for her sixth child. She's marked the baby's forehead to ward off evil spirits.
"I want my baby to survive, but it's God's will, if she dies", she says. "We cannot afford to move from this area. We are at the mercy of nature
because we are poor people."
Kenat(ph) says she labored with baby Shamalia(ph) through the rain. The World Health Organization says 1.2 million pregnant women are among those
displaced across Pakistan. A few bags of aid have been dropped off, but it's not enough to sustain the families according to a 70-year-old
grandmother who's witnessed three floods in her lifetime, but nothing quite like this.
UNIDENTIFIED FEMALE (through translator): We keep our eyes on our children after sunset. They could fall down into the water and drown. We have one
meal a day, we have to save food for our kids, God, please help us.
COREN: But it's not just a lack of food they're worried about. Mosquitoes, venomous snakes and water-borne diseases are a constant threat. The W. H.
O. says cases of typhoid, malaria and diarrheal disease are rising and will undoubtedly worsen. Foreign aid is slowly trickling in.
Former U.S. ambassador to the U.N., and now head of USAID, Samantha Power and U.N. Secretary General Antonio Guterres are due to arrive in Pakistan
this week in a desperate bid to ramp up international assistance and support.
KAYE: Pakistan, looking forward, is very dire. We've got to be there for the long term. We've got to be there for three or four months minimum in
order to save lives.
COREN: But for these people, near survival is a daily struggle. And these clear blue skies aren't expected to last long. More devastating monsoon
rains are days away to further terrorizing a traumatized country. Anna Coren, CNN, Hong Kong.
(END VIDEOTAPE)
SOARES: Just so much heartache there in Pakistan. We'll stay of course, on top of that story. Still to come tonight --
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I used to plan out my meals every week because we could do that. But now I'm not doing it because who knows what I can
afford, you know?
(END VIDEO CLIP)
SOARES: A heartbreaking personal story that shows Britons cost of living crisis. We look at how Prime Minister Truss plans to tackle the economic
catastrophe. That is next.
(COMMERCIAL BREAK)
[14:30:00]
(MUSIC PLAYING)
SOARES: Welcome back.
Well, Liz Truss has been in the job for, what, just over seven hours or so. She wasn't wasting any time becoming the new prime minister. She's now
getting details on how her cabinet is shaping up. Just a short time ago, we learned she has appointed Therese Coffey as deputy prime minister, as well
as health secretary.
Kwasi Kwarteng is the new Chancellor of the Exchequer. Of course, he had that task of getting the country through this tough economic crisis, as
well as James Cleverly takes Truss' old spot as foreign secretary.
Then we have Suella Braverman, who has been promoted to home secretary. So really hitting the ground running with these appointments.
And on top of Truss' agenda will be the cost of living crisis, something you and I, of course, have been hearing about as we talked about on this
show. Millions of Britons could be forced to choose between putting food on the table and heating their homes this winter.
I met one mother who is struggling to make ends meet. Have a look at this.
(BEGIN VIDEOTAPE)
BECKA, SINGLE MOTHER: It's become so stressful. I can't sort of cope with it, just sort of burying my head in the sand and just trying to today, by
day, by day.
SOARES (voice-over): Becka is at breaking point. Months into a growing cost of living crisis that is only expected to get worse, she's struggling
with mounting costs.
BECKA: Now I go shopping with my phone out. Everything that goes in, I add it up, then I have to think, then stop getting to a certain amount. If we
don't have what we need, we have to put stuff back.
SOARES: How does that make you feel?
BECKA: Almost like a failure, right.
SOARES (voice-over): A burden no parent should have to feel. But as a single parent, Becka tells me she is doing her best for her 9-year-old
daughter, juggling five jobs, keeping budgets on track, yet still struggling to put food on the table.
SOARES: This is everything you've got from the food bank?
BECKA: Yes, this is what we got today.
SOARES: What's in here?
BECKA: This is frozen chicken.
SOARES (voice-over): It's the harsh reality that's sadly only going to get worse. Inflation is set to hit 13 percent by the end of the year. Add food,
fuel and soaring home energy costs and it becomes unbearable.
BECKA: I used to plan out my meals every week because we could do that. But now I'm not doing it, because who knows what I can afford, you know?
SOARES (voice-over): But for families like Becka's, this week has meant even more spending. Kids are back to school and parents have tough
decisions to make.
BECKA: For the shirts and for summer dresses, I bought them, like, size 12, you know, ridiculously, like, as high up as I think I could manage. She
doesn't wear shoes because it's more cost-effective if I just buy her boots. Then she can be dry in the winter and just sweat it out in the
summer.
SOARES (voice-over): It's a dilemma that is felt across the U.K., including here in London, where one teacher here tells me families have
already started asking the school for support.
EMYR FAIRBURN, HEADTEACHER, KING'S CROSS ACADEMY: And really, what can they do when bills are going to go up so much?
How are they going to afford for food?
That's where the parents are asking us and the impact on children's learning could be as great as it was during the pandemic, during lockdown.
SOARES (voice-over): There is no escaping the worst financial squeeze in 60 years but the poorest will bear the brunt of this crisis.
BECKA: We are down to our last thing of pesto.
SOARES (voice-over): The hunger, hardship, the mental anguish and the stigma of poverty.
BECKA: It's really shocking how difficult it is just to have the very basics. I just want to be able to eat real food, heat my house and wear
good clothes. That's what I want to have, you know?
(END VIDEOTAPE)
SOARES: And our thanks to Becka for taking the time to speak to me earlier this week. Really about the crisis that we are seeing. With me now is
Matthew Holehouse, a British political correspondent for "The Economist."
And Matthew, you know, what we captured there is one story. There are so many stories up and down this country, people who are having to pick
between heating or eating. We haven't even hit October yet, when those prices are expected to surge including gas prices.
This is going to be the biggest challenge for Liz Truss. It's something that she addressed today.
MATTHEW HOLEHOUSE, BRITISH POLITICAL CORRESPONDENT, "THE ECONOMIST": It's an enormous challenge.
[14:35:00]
HOLEHOUSE: The past two previous predecessors entered at times of huge political strain. Theresa May took over it during the beginning of the
Brexit process; Boris Johnson took over to end that Brexit crisis, it became.
The challenges facing Liz Truss are equal, greater than those. They are both the immediate strains facing the British economy but the political
strain that that places upon her, the pressure she will be facing from the opposition and her own MPs to deliver something equal to these pressures.
SOARES: What did you make of what of her speech today outside 10 Downing Street?
She said we will transform Britain into aspirational nation, very positive, very optimistic.
Is this something that will resound up and down the country and what people want to hear, that she will deliver on all of this?
Obviously we don't have the details on how that's been done. But just strike the tone, the way she strikes the tone.
What did you make of that?
HOLEHOUSE: It was very interesting. That's classic Liz Truss. She's always traded on being a very optimistic, cheery politician. Throughout the
campaign, she said, I don't believe in all of this declinist talk. I believe our best days are ahead of us.
That is at a distance from the actual reality facing the country as these gas bills and government intervention, I expect they will be start landing
on people. A lot of that retro risks feeling divorced from where people are. And that's obviously why she's going to, you know, move on with this
package that we are expecting.
But that's quintessential Liz Truss and every prime minister has to say, that every prime minister how they're going to transform the country.
The political challenge she's facing is that this is a party that's been in power now for 12 years. She's their fourth successive prime minister in
office.
So the challenge is, how do you sell that reset?
How do you set out a fresh vision while trying to convince the public that this is a fresh administration and not a long serving party attempting to
remake itself?
SOARES: Such a good point, Matthew. Let me show you this. We've got a new poll -- released Monday, actually focused on Liz Truss, Matthew. Six in 10
Brits say the new PM should call a general election by the end of this year.
As you can see there on your screen, just over half do not believe Liz Truss can unite the U.K. public. Less than 20 percent believe she's capable
of that. And one in six have a favorable view of Truss, 44 percent think favorable of her.
It's worth pointing out, this poll was done before it was announced that she would be the leader of the Conservative Party.
What do you make of these numbers in terms of how the public, how the country views her?
HOLEHOUSE: I mean, that's a very difficult starting point. The numbers speak for themselves. She's not particularly well-known in the general
public. She has an image that has stuck to her, of a slightly gawky figure. A lot of her speeches earlier in her career --
(CROSSTALK)
SOARES: She's transformed that.
HOLEHOUSE: -- she really has. She went through a phase where she became a much more sort of formal politician. Some people thought she was maybe
challenging the ghost of Margaret Thatcher in the way that she positioned herself slightly -- throughout this campaign actually, as her confidence
developed, we saw her relax a bit.
Became a bit more of the Liz Truss that we see in private. She's not afraid to crack a joke or wink at people. Some of her allies say that the public
will warm to her as they see her.
But actually, that's quite a difficult thing to do when you are facing such a, you know, challenging economic environment, to actually sell yourself.
She won't have a long honeymoon.
(CROSSTALK)
SOARES: As we saw really today, she's already announcing what her cabinet will look like. I mean, during she was traveling up and down the country
during the -- six, seven weeks, I can't remember how many weeks this was, she sounded very focused on what she wanted, kind of like the lady -- very
much of Margaret Thatcher.
Do you think that she will have to make concessions, she will have to, given the challenge, she will have to take in some of the other views, that
perhaps she wouldn't have considered prior to becoming prime minister?
HOLEHOUSE: I mean, she's going to have to pull off a really extraordinary pivot, as it were. It's always different how you campaign, seeking the
nomination of your party versus how you talk to the country. Look at how Keir Starmer has transformed himself and sort of been a Jeremy Corbyn (ph)
figure, looking to be someone much more moderate, even slightly conservative in some of his policies.
Liz Truss is going to have to do something very similar. Exhibit A is the NHS. During this leadership contest, the NHS barely featured. The Tory
membership actually really is not that interested in hearing about, oh, yes. The evidence from this contest was, rather, the Tory membership was
not that animated on the National Health Service.
(CROSSTALK)
HOLEHOUSE: Much more interested in council policy or Brexit, whatever. Her speech that we saw earlier today on Downing Street, her top three
priorities were energy crisis, the border economy and the NHS.
She has to do that because she knows NHS ratings are high. We've seen some really quite difficult scenes in some hospitals. There's evidence of long
queues of people getting out of ambulances.
The NHS is going to be the number one issue or at least the top three issue in the next general election and we know that's the case because it was up
there in the last general election, in the general election before that, right?
[14:40:00]
HOLEHOUSE: It's always the case. Unless she pivots quite quickly into coming up with something very credible to bring down those ratings, show
that there is going to be the burdens this winter alleviated, she's going to be very, very (INAUDIBLE) Labour (ph) making that the number one --
(CROSSTALK)
SOARES: It's not just of course, Matthew, what she says but what she does, I think, in the days and weeks ahead that will really define the first few
weeks of her leadership. Thanks very much, Matthew. Great to have you on the show, appreciate it.
Still to come tonight, two people, including an activist, have been sentenced to death in Iran. A rights group says, they are innocent. We will
explain next.
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Now there are still many questions, as Canadian police pursue a province wide dragnet for the remaining suspect in Sunday's deadly stabbing attack.
One of two brothers, 30-year-old Myles Sanderson remains at large. Police say, he may be injured.
His 31-year-old brother was found dead on Monday. (INAUDIBLE) is monitoring this and it's a really complex investigation for us, from the Canadian
capital of Ottawa.
Paula, just bring us up to date on where we are on the hunt for this manhunt for this second brother.
PAULA NEWTON, CNN ANCHOR AND CORRESPONDENT: Right, some terrifying information just in the last hour, Isa. So police in Saskatchewan, the
province of Saskatchewan, have now issued an alert on everyone's phone in the province but specifically for James Smith Cree Nation, where many of
those attacks took place.
Believing that there may have been a sighting of Myles Sanderson. A reminder, he is charged with first degree murder. He has a violent past.
He's the prime suspect in these stabbings.
Police continue to describe him as armed and dangerous. We do know that police continue to rush to the scene and will obviously continue to search
it.
What's peculiar here, Isa, is that police told us that the last sighting they may have had of him was about two days ago in the capital of
Saskatchewan, which is several hours drive from this site, this indigenous community, where those attacks mostly took place.
It really is unnerving for the residents there, Isa. This is their worst nightmare. They have been essentially on lockdown since this happened. A
state of emergency in the community is ongoing until the end of the month.
And they really felt that this was a menacing presence, that they can't begin to heal until they know that Myles Sanderson is apprehended.
[14:45:00]
NEWTON: We should also note that police refused to say whether or not they believe that Myles Sanderson killed his brother, Damien Sanderson. He was
found just yesterday in that indigenous community.
They continue, obviously, to investigate and really collect as many eyewitness accounts as they can. But again, those residents are now in
lockdown, terrified. And Isa, we will continue to bring you up to date as we continue to get developments from the center of Saskatchewan.
SOARES: Just terrifying for all these residents, of course. They await for answers as well and some sort of closure like, you said, Paula Newton for
us there. Thanks so much, Paula. Appreciate it.
Well, Amnesty International says, it is outraged over the sentencing of an LGBT activist to death in Iran. The NGO says, the activist, as well as
another person who was sentenced to death, are being framed as human traffickers by Iranian authorities. Let's get more on this story, CNN's
Salma Abdelaziz on this.
And, Salma, this activist, from what I understand, has been accused of corruption on Earth.
What exactly does that mean?
SALMA ABDELAZIZ, CNN CORRESPONDENT: It's a quite vague term but if you're looking at Iranian state media, what a court has found these two
individuals guilty of is smuggling, human trafficking.
They say that this Iranian court, this Iranian judge found these two individuals to be responsible for trying to traffic women and girls across
the Iranian border illegally.
There's also a separate charge against one of these individuals, Zahra Sedighi-Hamadani, from one of the prosecutors in the region, accusing her,
specifically, of spreading Christianity and promoting homosexuality.
Now the second individual we are speaking about here, Elham Chobdar, is, of course, handed down this death sentence. We don't know her exact status, if
she's an activist or what her work is. But what Amnesty International is saying is that these accusations, this death sentence is baseless.
They call this an outrage, they say Hamadani is a well-known LGBTQ activist and that is the reason that she's been handed this death sentence. I want
you to take a listen to what she said in her own words about living as a gay person in Iran. Take a look.
(BEGIN VIDEO CLIP)
ZAHRA SEDIGHI-HAMADANI, ACTIVIST (through translator): I want you to understand that we, the LGBT community in Iran, are under so much pressure.
We sacrifice our lives for our emotion but reach a deep understanding of ourselves, whether it is death or freedom.
(END VIDEO CLIP)
ABDELAZIZ: You can hear their just how outspoken she has. She is also known by the name Sareh within the activist community and this is part of a
very long ordeal for her, Isa.
Hamadani was originally arrested in Iraq last year in Irbil after speaking to a BBC network about the difficulties of living as a gay person in Iran.
After that arrest, she went back to Iran in the hopes that she could get to Turkiye and tried to seek asylum there.
She was, of course, arrested in Iran late last year. Now of course, these two death sentences being handed down. Amnesty International saying, again,
that they have information that shows these convictions are based on discrimination, based on the discrimination against their gender and
orientation, against their sexual identity.
And it's, of course, part what of what human rights groups have been ringing the alarm about now for a long time and that is that sexual
minorities in Iran are persecuted. People from LGBTQ backgrounds are persecuted and, yes, there is going to be an appeal in an Iranian supreme
court.
But what rights groups are concerned about is that these two individuals will simply not receive a fair trial in a country that considers
homosexuality illegal, that considers any sexual relationships outside of traditional marriage illegal. Isa.
SOARES: An important story there from our Salma Abdelaziz. Thanks so much, Salma. Appreciate it.
And still to come tonight, Boris Johnson hands over the keys to Number 10. We look at the transfer of power and what the U.K. can expect going
forward. That is next.
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[14:50:00]
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SOARES: Well, the new British prime minister's cabinet is starting to take shape. Have a look at this. In the last hour, we've learned the names of
several of Liz Truss' ministers.
Therese Coffey became deputy prime minister and health secretary; Kwasi Kwarteng, as you can see there, much discussed and speculated, is now the
Chancellor of the Exchequer. James Cleverly becomes a foreign secretary, taking, of course, Liz Truss' former job. And Suella Braverman has been
appointed home secretary.
So really Liz Truss really hitting the ground running at a point at the top four or so roles for her cabinet. It's been a long and momentous day. Of
course, as Ms. Truss takes over, Bianca Nobilo walks us through this transition of power.
(BEGIN VIDEOTAPE)
BIANCA NOBILO, CNN ANCHOR AND CORRESPONDENT (voice-over): A final lap of honor for Boris Johnson, flanked by applauding staff and civil servants,
Johnson departed Downing Street as prime minister for the last time.
As for what he will do next...
BORIS JOHNSON, U.K. PRIME MINISTER: I'm not like one of those booster rockets that has fulfilled its function and I will now be gently reentering
the atmosphere and splashing down invisibly in some remote and obscure corner of the Pacific.
NOBILO (voice-over): -- a speech outlining his legacy.
Brexit, the vaccine rollout and support for Ukraine. Many in his party will be sad to see him go, ousted following months of scandal. Johnson made no
mention of the events that ultimately led to his downfall. He concluded by throwing his considerable political heft behind his replacement.
JOHNSON: It's time for politics to be over, folks. It's time for us all to get behind Liz Truss and her team and her program and deliver for the
people of this country.
NOBILO (voice-over): Johnson and Truss then took separate planes for the 1,100-mile round trip to Scotland, to visit the queen. Johnson, submitting
his resignation and Truss being invited to form a new government, meetings which are strictly private.
For Britons looking on, support amidst a cost of living crisis is their top priority.
Truss will be expected to lay out a new vision -- and fast. The leadership contest lasted six long weeks, during which the pound slumped to its lowest
rate against the dollar since 1985.
Returning to London, Truss did what Johnson did hours just before, Britain can ride out this storm, she said, as thunder cracked and lightning struck
over London. Details of how will follow this week.
LIZ TRUSS, U.K. PRIME MINISTER: We should not be daunted by the challenges we face. As strong as this storm may be, I know that the British people are
stronger.
(END VIDEOTAPE)
SOARES: And she is not wasting any time in setting out what her cabinet would look like. Bianca Nobilo joins me now to discuss the transfer of
power, of course, and what we can expect from Ms. Truss and this government going forward.
Let's start with some of the appointments that we've seen in the last half hour or so. Some of the names that actually you and I have been discussing
throughout the day. Kwasi Kwarteng, of, course taking the biggest job here, when it comes to the economy.
NOBILO: Yes, I would say the most significant thing about these appointments, they are what we call the great offices of state. So prime
minister is now a female. The chancellor, the second great office of state, is now Kwasi Kwarteng. Suella Braverman is now the home secretary.
[14:55:00]
NOBILO: As we know in the foreign secretary is James Cleverly.
(CROSSTALK)
SOARES: No white man.
NOBILO: That's the thing. For the first time in history, no white male occupies one of the great offices of state, which is a very significant
moment in terms of inclusivity and diversity.
And we have the first ever female chief whip. Now that's the role that's in charge of party discipline and matters of party conduct. So some of the
problems that precipitated Boris Johnson's downfall.
(CROSSTALK)
SOARES: -- are their allies, how much -- are these are her closest allies here or is she really reaching out to other sides of her party?
This was some of the criticism, of course.
NOBILO: We are not seeing yet huge reaching out across the aisle. We've heard that Ben Wallace has been confirmed as defence secretary, which,
again, does not really telegraph much. He's considered to be doing a very strong job in that role.
And obviously, it doesn't necessarily make sense to move posts at the moment because he has so much on his plate and he wants to continue to try
and execute Britain's role in Ukraine as best he can.
So right now, we are not seeing the signs of her reaching out across the party.
(CROSSTALK)
SOARES: Do you think she will?
NOBILO: She may well. This is her inner sanctum, if you like. It would be quite surprising for a prime minister to include people who have quite a
diverse opinion from them in one of these roles. They are key roles, especially now, because each of them, if you like, will preside over one
area of crisis in the U.K.
(CROSSTALK)
NOBILO: She needs to sing from the same hymn sheet as those people. I would expect that we will start to see nods to other parts of the party,
perhaps on (INAUDIBLE) who was one of the leadership contenders, others like that who are more from the center of the party, center left
Conservative Party.
We will probably see those announced over the next day or so.
SOARES: And of course, we've got Prime Minister's Questions. I think that's taking place tomorrow. That should be very exciting, very
interesting to see.
(CROSSTALK)
SOARES: Bianca, thank you very much.
Of course, Bianca will be back with the "GLOBAL BRIEF" live from right here outside Parliament at 10 pm, London time.
Thanks very much for your company. I will be back with "QUEST MEANS BUSINESS" after a very short break. Have a wonderful rest of your day. Bye-
bye.
END
