London politics latest LIVE: Jeremy Hunt in Commons to explain scrapping of disastrous ‘growth plan’

A top Tory minister has said “sorry” for economic turmoil sparked by the Government’s mini-budget - just before new Chancellor Jeremy Hunt addressed the Commons following his U-turn on the disastrous economic plan.

Commons Leader Penny Mordaunt made the apology about the fiscal statement’s impact on Monday afternoon, as she stood in for Liz Truss to answer an urgent question on why the Prime Minister sacked former Chancellor Mr Kwarteng.

After new Chancellor Mr Hunt tore up large parts of Mr Kwarteng’s so-called mini-budget, Ms Mordaunt told MPs in the House of Commons: “I understand that people want certainty and reassurance about their bills, their businesses and their benefits.

“And I am sorry that the events leading to the changes today have added to the concerns about the major volatility that was already there existing in the economy.”

Ms Mordaunt added that the Prime Minister is not - as some opposition MPs suggested when she failed to appear in the Commons on Monday - hiding “under a desk”, but was instead absent “for a very good reason”.

The key points from Mr Hunt’s emergency statement on Monday morning were:

• Plans to reduce the basic rate of income tax from 20 per cent to 19 per cent in April next year were scrapped

• Plans for new VAT-free shopping for international tourists scrapped

• Help with energy bills for all households will only last until April, with Mr Hunt announcing a review to look at a “new approach” to target support at those worst off after that

• Planned cut to stamp duty will continue, as will the reversal of the 1.25 percentage point increase in national insurance contributions

Hunt: Liz Truss will still be PM at Christmas

20:39 , John Dunne

Jeremy Hunt has said he believes Liz Truss will still be prime minister at Christmas.

The Chancellor mad the comment despite five Conservative MPs already publicly calling for her to leave Number 10.

He told Sky News Conservative MPs should “give her a chance”.

“People who want her to go need to ask themselves whether more political instability is going to keep mortgage rates down,” he said.

“I don’t think political instability is the answer. She’s been prime minister for about five weeks and we need to give her a chance.”

Mr Hunt continued: “I would rather a leader who listens, learns and changes and I think we would have more instability, much more instability, if we were to have a leadership process.”

Asked if he believes Ms Truss will still be PM at Christmas, the chancellor said: “I believe so, yes.”

The chancellor also ruled out ever running for the top job himself, saying: “I rule it out, Mrs Hunt rules it out, three Hunt children rule it out.”

Tory MP brands Truss government errors ‘schoolboyish'

20:25 , John Dunne

Tory MP Simon Hoare said some of the errors from the Truss Government have been “schoolboyish” and “unforced”.

He told journalists following a meeting of the One Nation group of Conservative MPs: “Some of the errors have been schoolboyish, some of the errors have been unforced, some of the wounds have been self-inflicted. And that’s regrettable. But we are where we are.”

He added that “polls come and go”, arguing that “this voracious appetite for who thinks what about whom, when and where, doesn’t actually help, because it doesn’t allow for calm, reflective decision making”.

He said no one in the meeting had suggested Ms Truss should stand down.

Jacob Rees-Mogg: Liz Truss should “absolutely not” resign

19:47 , John Dunne

Business Secretary Jacob Rees-Mogg told journalists that Liz Truss should “absolutely not” resign and that she is “a very good Prime Minister” as he arrived at Downing Street this evening.

Truss tells One Nation tories she accepts “mistakes have been made”

18:47 , John Dunne

Liz Truss acknowledged “mistakes have been made” at a meeting of the One Nation group of Tory MPs, according to Conservative Party chairman Jake Berry.Leaving the meeting, he told journalists there had been a focus on “unity”.“The Prime Minister started by saying that mistakes have been made, she acknowledged them, she is bringing the party together,” he said.“Colleagues who were there (were) very heavily focused on unity. Matt Hancock made a really good intervention, saying that now is the time for unity, we’ve got to get behind the PM.”He said Ms Truss had been “exceptional”, and he had not heard any irritation towards her in the meeting, however he noted it was still going on.

Chancellor “under half way” to plug hole in public spending says senior tory

18:38 , John Dunne

Senior Conservative MP Mel Stride suggested Chancellor Jeremy Hunt is “under half way” to plugging the fiscal hole and predicted public spending cuts to health, social care and pensions.

He told BBC Radio 4’s PM programme: “I think the OBR (Office for Budget Responsibility) is probably sitting on a figure for that fiscal hole of about £70 or £72 billion. So he’s still got another £40 billion to go, he’s under half way…

“Without leaning into spending in a meaningful way, it’s very difficult to see how he’s going to close that gap down”.

Asked if there is much fat to trim from buckling public services, he conceded that “it’s going to be very difficult”.

But, he said, the big budgets that have been growing over the last decade, such as health, social care and pensions, “takes a huge proportion of public spending”.

“So if you’re not going to do something across those particular areas, you’re really going to struggle to maintain investment for example to provide that growth that we so desperately need.”

Senior backbencher becomes fifth Conservative to call for Truss resignation

18:36 , John Dunne

Senior Tory backbencher Sir Charles Walker has become the fifth Conservative MP to publicly call on Liz Truss to resign as Prime Minister.

He told Sky News’ Beth Rigby: “I think her position is untenable. She has put colleagues, the country, through a huge amount of unnecessary pain and upset and worry.

“We don’t need a disruptor in No 10. We need a uniter.”

The situation “can only be remedied” with “a new prime minister,” he said.

He gave Ms Truss another “week or two” before she steps down or is forced to resign, adding that he is “so cross” about how “catastrophically incompetent” the Government has been.

Liz Truss meeting with Sir Graham Brady ‘pre-planned’

18:29 , John Dunne

Liz Truss met Sir Graham Brady, chairman of the 1922 committee of backbench MPs, on Monday as she battled to stay in office.Government sources insisted the meeting was “pre-planned”.It took place while Commons Leader Penny Mordaunt was answering an urgent question in Parliament on why the PM sacked Chancellor Kwasi Kwarteng.The sources also stressed that the Prime Minister had “lots else on” and that no PM had responded to an urgent question since David Cameron in April 2012.Part of Sir Graham’s role is to tell the PM the mood in the parliamentary party and whether she is losing the support of her MP

Prime Minister arrives for meeting with One Nation Tories in attempt to shore up support

18:23 , John Dunne

Prime Minister Liz Truss has arrived at a meeting of the One Nation group of Tory MPs in Westminster.

The group represent centrists in the Conservative party and it is understood she is trying to get them onside as her leadership reamins in the balance. She is also expected to meet Cabinet members after her mini-budget was torn up by new chancellor Jeremy Hunt.

Liz Truss was with Graham Brady when Chancellor addressed Commons

18:19 , John Dunne

Liz Truss was with a key Tory backbench MP when she avoided a House of Commons grilling.

Commons Leader Penny Mordaunt, stood in for the Prime Minster to answer an urgent question on why Mrs Truss sacked Mr Kwarteng.

She repeatedly refused to say precisely where the Prime Minister was but did give the apology about the fiscal statement’s impact on people’s mortgages and firms.

It’s since emerged Mrs Truss was meeting with Graham Brady, the chair of the key 1922 Committee of backbench Tory MPs - and the man to whom letters of no confidence would be sent.

Hunt will not guarantee to deliver commitment to spend 3% of GDP on defence

17:40 , John Dunne

Jeremy Hunt has failed to guarantee the Government will deliver on its commitment to spend 3% of GDP on defence.

The Conservative chairman of the Commons Defence Committee and former minister Tobias Ellwood asked him in the Commons: “My friend knows the world is getting more dangerous, not less.

“Will he commit to continuing that promise of 3% GDP defence spend?”

The Chancellor replied: “Well, it won’t be a secret to my right honourable friend that I’m sympathetic to that because I’ve campaigned for it when I was a backbencher very loudly and visibly, but all of these things have to be sustainable.

“Any increase in defence spending has to be an increase that we can sustain over very, many years. Let me just say to him today that I agree with him entirely, that the duty of the Government is security for the population in all senses of the word.”

MPs demand chancellor follows through on infrastructure projects despite economic woes

17:30 , John Dunne

The Chancellor faced calls to promise that important infrastructure projects in the north of England would not be scrapped in light of the squeeze on public spending.

Conservative MP Kevin Hollinrake (Thirsk and Malton) asked: “Can he confirm any cuts to spending will not impact on capital expenditure, infrastructure expenditure, particularly across the north and that we will fully deliver on projects that we have already committed to such as Northern Powerhouse Rail?”

Jeremy Hunt replied: “As he will know, there are very important projects that we all care about a great deal, but given the severity of the situation at the moment we are not taking anything off the table whether tax increases or spending reductions.

“But I don’t believe it is possible to have a long-term credible economic growth strategy that doesn’t recognise the vital importance of capital spending.”

Labour lead by 36% according to new poll

17:19 , John Dunne

A poll of voting intentions has has revealed Labour has a 36% lead over the Conservatives - the largest lead of any party since 1997.

The data from Redfield and Wilton Strategies puts Labour on 56% and the Conservatives on 20%.

The Liberal Democrats are on 11% and the Greens 5%, according to the poll.

Prime Minister “reluctantly” agreed to ditch energy price guarantee beyond April 2023

17:08 , John Dunne

Jeremy Hunt said he and the Prime Minister have “reluctantly” agreed it would not be responsible to keep the energy price guarantee beyond April 2023.

The Chancellor told the Commons: “The third step I’m taking today, is to review the energy price guarantee. It is the biggest single expense in the growth plan and one of the most generous schemes in the world, it’s a landmark policy for which I pay tribute to my predecessor, my right honourable friend from Spelthorne and it will support millions of people through a difficult winter reducing inflation by up to 5%.

“So I confirm today that the support we are providing between now and April next year will not change.”

Hunt admits problems caused by failure to consult the Office for Budget Responsibility

17:01 , John Dunne

Chancellor Jeremy Hunt said the UK has faced “short-term difficulties” caused by the lack of an Office for Budget Responsibility forecast alongside the so-called mini-budget.

Speaking in the Commons, he said: “I want to be completely frank about the scale of the economic challenge we face. We have had short-term difficulties caused by the lack of an OBR forecast alongside the mini-budget.

“But there are also inflationary and interest pressures around the world.”

Chancellor announces new economic advisory team

16:58 , John Dunne

The Chancellor has announced the formation of a new economic advisory council to provide “more independent expert advice” to the Government.

Jeremy Hunt told the Commons he “fully” supports the “vital, independent” roles of the Bank of England and the Office for Budget Responsibility.

However, he added: “But I also want more independent expert advice as I start my journey as Chancellor. So, I’m announcing today the formation of a new economic advisory council to do just that.

“This council will advise the Government on economic policy with four names announced today. Rupert Harrison, former chief of staff to the chancellor of the Exchequer, Gertjan Vlieghe from Element Capital, Sushil Wadhwani of Wadhwani Asset Management and Karen Ward of JP Morgan.”

Shadow Chancellor Rachel Reeves: ‘chaotic Zigzagging U-turns’ destroy credibility of government

16:55 , John Dunne

Shadow Chancellor Rachel Reeves tore into the government’s mini-budget and subsquent U-turns in the Commons.

Addressing chancellor Jeremy Hunt she said: “Can he not apologise?” ... for chaotic zigzaging U-turns”.

Chancellor blames Putin for energy and food price spike

16:47 , John Dunne

Chancellor Jeremy Hunt told MPs: “Russia’s unforgiveable invasion of Ukraine has caused energy and food prices to spike.

“We cannot control what is happening in the rest of the world, but when the interests of economic stability means the Government needs to change course, we will do so and that is what I have come to the House to announce today.”

Speaking about his meetings on taking the position, he added: “The conclusion I have drawn from those conversations, is that we need to do more, more quickly to give certainty to the markets about our fiscal plans and show through action and not just words that the UK can and always will pay our way in the world.”

Jeremy Hunt warns of ‘eye watering’ challenges

16:45 , John Dunne

Chancellor Jeremy Hunt warned of “decisions of eye-watering difficulty”.

Speaking in the Commons, he said: “That means decisions of eye-watering difficulty. But I give the House and the public this assurance, every single one of those decisions, whether reductions in spending or increases in tax, will be shaped through core compassionate Conservative values that… prioritise the needs of the most vulnerable.”

Liz Truss arrives in Commons for Chancellor’s statement

16:40 , John Dunne

Liz Truss arrived in the Commons chamber ahead of a statement from Chancellor Jeremy Hunt.

Commons Leader Penny Mordaunt had been repeatedly asked about the Prime Minister’s whereabouts after Ms Truss sent her to respond to a Labour urgent question in Parliament.

Commons leader apologises over events adding to economic turmoil

16:11 , Lydia Chantler-Hicks

Penny Mordaunt has apologised in the Commons for the fact events leading to today’s changes have “added to the concerns” about the “major volatility” in the economy.

The Commons Leader’s comments came after Liberal Democrat leader Sir Ed Davey asked her: “The previous prime minister shattered the public’s trust in the Government. The current Prime Minister has trashed the British economy.

“Meanwhile, Conservative MPs have sat there and let it happen. So for the damage and pain they have caused across our country, will the Leader of the House on behalf of the whole party, address the people and businesses of our great country and apologise?”

Ms Mordaunt replied: “We have made this change for a reason. And I understand that people want certainty and reassurance about their bills, their businesses, and their benefits.

“And I am sorry that the events leading to the changes today have added to the concerns about the major volatility that was already there existing in the economy. That’s why we are putting it right today.”

Prime Minister is not hiding ‘under a desk’ says Penny Mordaunt

16:09 , Lydia Chantler-Hicks

Liz Truss is “not under a desk”, according to Commons Leader Penny Mordaunt.

Labour MP Stella Creasy (Walthamstow) said it is the job of the Prime Minister to take big decisions on many issues, adding: “All we know right now is, unless she tells us otherwise, the Prime Minister is cowering under her desk and asking for it all to go away.

“Isn’t it about time she did and let somebody else who can make decisions in the British national interest get in charge instead?”

Ms Mordaunt replied: “Well, the Prime Minister is not under a desk, as the honourable lady says…”

The minister could barely be heard at this point due to laughter and heckling from opposition MPs.

Ms Mordaunt added: “I can assure the House that, with regret, she is not here for a very good reason.”

Energy bills U-turn will leave people ‘alarmed’ says Irish finance minister

16:08 , Lydia Chantler-Hicks

Stormont Finance Minister Conor Murphy says many people will be “concerned and alarmed” at Chancellor Jeremy Hunt’s announcement of a reduction of energy bill help.

Mr Murphy said: “I think a lot of people who are struggling to heat their homes and pay their bills over the course of this cost-of-living crisis will be concerned and alarmed at the fact that what was to have been a two-year intervention for households, an energy cap, is now reduced down to six months with a review.

“I think that that will leave people feeling even more worried than they already are.

“The idea that after 10 years of austerity, which has brought our public services to their knees, which has stripped the NHS of the support that it needs, not only to look after patients and the health of the public, but also to try and reform itself as well, that we might be heading down another austerity road with the British government again is something which will cause huge dismay,

“Today’s announcements, I don’t think brings us any further in any positive direction.”

16:04 , Lydia Chantler-Hicks

Prime Minister Liz Truss has left Downing Street.

Ms Truss was seen leaving at the back of Number 10 in a silver Range Rover shortly before 3.50pm.

Commons leader says Liz Truss has acted with ‘courage’ and ‘in national interest'

15:54 , Lydia Chantler-Hicks

Commons Leader Penny Mordaunt defended the Prime Minister’s decision to change Chancellor, saying it was the “right thing to do” and “it took courage”.

Responding to Labour in the Commons, Ms Mordaunt said she will “defer to the Chancellor” to answer questions raised by Keir Starmer on the Government’s economic policy.

She added: “The decision taken by our prime minister would have been a very tough one politically and personally. Yet she has taken it. And she has done so because it is manifestly in the national interest that she did.

“She did not hesitate to do so because her focus is on the wellbeing of every one of our citizens. It was the right thing to do and whether you agree with it or not, it took courage to do it.”

She went on to say it “took no courage or judgement or regard to the national interest” for Labour leader Sir Keir to criticise the government.

“Today when the country needs some stability...he now calls for [a general election] and weeks of disruption and delay [it would bring],” she said. “We will take no lectures from the honourable gentleman on working in the national interest.”

Starmer’s urgent question to Tories

15:47 , Lydia Chantler-Hicks

In his Urgent Question in the House of Commons, Keir Starmer asked the Prime Minister to make a statement on the replacement of the Chancellor of the Exchequer during the current economic situation.

The Labour leader joked, to widespread laughter from his party: “I guess under this Tory government everybody gets to be Prime Minister for 15 minutes.

“The country is in an economic crisis made in Downing Street because they’ve lost all credibility,” he added.

“Government borrowing costs have soared, mortgage rates have ballooned, markets need reassuring - and there is long-term damage that can’t be undone.

“Once you’ve crashed a car at 100mph, you’ve damaged it for good and you’re going to be paying much more on your insurance for years to come.

“And it’s working people who will pay - left wondering if they can afford to stay in their homes, if their hopes of owning a home haven’t already been crushed.

“So, now it’s time for leaders to lead. But where is the Prime Minister? Hiding away, dodging questions, scared of her own shadow, the lady’s not for turning up.”

Keir Starmer accuses PM of ‘hiding away'

15:44 , Lydia Chantler-Hicks

Labour leader Sir Keir Starmer has accused Luz Truss of “hiding away, dodging questions, scared of her own shadow”.

“Now it’s time for leaders to lead, but where is the prime minister?” he asked.

Mordaunt: ‘We will take whatever tough decisions are necessary'

15:41 , Lydia Chantler-Hicks

Penny Mordaunt, replying to Labour’s urgent question, told the Commons: “The Prime Minister has taken the decision to appoint (Jeremy Hunt), one of the longest-serving and most experienced parliamentarians, as her Chancellor.

“Their overriding priority is to restore financial stability in the face of volatile global conditions.

“We will take whatever tough decisions are necessary and have made changes to the growth plan, which the Chancellor is waiting to update the House on as soon as this urgent question finishes.”

Liz Truss’ absence from Parliament met with shouts and jeers

15:37 , Lydia Chantler-Hicks

The Commons is in session and Leader of the House Penny Mordaunt has been met with loud jeers as she made excuses for the Prime Minister’s absence.

Shouts of “where is she?” and “weak” could be heard after Ms Mordaunt deputised for Liz Truss to respond to an urgent question on the Prime Minister’s decision to appoint a new Chancellor.

“With apologies to the leader of the opposition and the house, the Prime Minister is detained on urgent business,” she said, to raucous shouts from MPs. “And I’m afraid you’ll have to make do with me.”

U-turn on alcohol duty is a ‘huge blow’ to industry, warns whisky boss

15:30 , Lydia Chantler-Hicks

Distillers, brewers and pubs have said the Government’s decision to scrap plans to freeze alcohol duty is a “huge blow” amid pressure from soaring costs and softer consumer sentiment.

New Chancellor Jeremy Hunt confirmed today that the Government will reverse its commitment to freezing alcohol duty, which was due to come into force in February.

It is understood that plans to increase the duty in line with retail price index (RPI) inflation will save the Government around £600 million a year.

Most recently, RPI inflation struck 12.3% in August. A similar increase to alcohol duty would be the equivalent to a roughly 39p increase on a bottle of wine.

Mark Kent, chief executive of the Scotch Whisky Association, urgently called on the Chancellor to reinstate the planned freeze.

“Business can only work on the basis of certainty and stability,” he said. “That has been stripped from the Scotch Whisky industry following the Chancellor’s decision to U-turn on the duty freeze for Scotch Whisky announced just over two weeks ago.

“With the average-priced bottle of Scotch Whisky already taxed at 70%, a double-digit rise in spirits duty will now seriously reduce the industry’s ability to support the UK economy through investment, job creation and rising revenue to the Treasury.

“It will add to pressures in the UK hospitality industry and household budgets as costs inevitably increase.”

The Government has stressed that the next steps of its lengthy review into alcohol duty will continue as planned despite today’s policy reversal.

Left wing ex-MP blocked by Labour from running in Kensington

15:02 , Lydia Chantler-Hicks

Left wing ex-Labour MP Emma Dent Coad says she has been blocked by the party from standing as the candidate in Kensington.

“I am devastated that the Labour Party has blocked me from standing to once again represent my community in Parliament, the community I have spent the last 20 years of my life fighting for” she said in a statement.

Kensington is close, with Tory Felicity Buchan only winning by 150 seats in 2019. There are many candidates fighting for the seat, with Hackney councillor Mete Coban, and local Labour deputy leader Kasim Ali among them.

Last week, left-wing Sam Tarry was deselcted as Labour candidate in Ilford South.

A Momentum spokesperson said: “It is a travesty of justice that passionate, popular advocates for their community like Emma are being blocked en masse by Keir Starmer’s Labour on spurious grounds, so loyalists from outside the area can be parachuted in. This is a deeply damaging episode for the Labour Party in Kensington, and one that local people are unlikely to forget.”

Former shadow Chancellor John McDonnell said: “These blockings don’t just undermine Labour’s broad church, they ride roughshod over the rights of our local parties and trade unions. We need Keir Starmer to urgently intervene and ensure fair process.”

Today’s U-turn not enough to plug budget gap, warns IFS boss

14:35 , Lydia Chantler-Hicks

Institute for Fiscal Studies director Paul Johnson welcomed the new Chancellor’s U-turns but warned they “won’t be enough by themselves to plug the gap in the Government’s fiscal plans”.

“Nor will they be enough to undo the damage caused by the debacle of the last few weeks, but they are big, welcome, clear steps in the right direction,” he said.

“It is also encouraging that, with most of the tax cuts abandoned, perhaps the most growth-friendly of them, the stamp duty cut and the increased annual investment allowance for corporation tax, remain.”

He warned that new Chancellor Jeremy Hunt “will still have to make some scary decisions on tax and spend this Halloween and it remains hard to see where significant spending cuts could come from”.

Mr Johnson said the plan to change the energy price guarantee was “especially welcome” as “we need to do everything possible to put in place a better designed, better targeted and less expensive scheme next year”.

Penny Mordaunt expected to answer Labour question, not PM

13:53 , Lydia Chantler-Hicks

Leader of the House Penny Mordaunt will respond to Labour’s Commons urgent question on Liz Truss’s behalf at 3.30pm, Downing Street has confirmed.

The Prime Minister’s decision to send Ms Mordaunt, her former Tory leadership rival, is likely to raise further questions about her authority.

The question, in the name of Sir Keir Starmer, on the economic situation is directed to the Prime Minister after she refused to come to the House after the sacking on Friday of Kwasi Kwarteng.

Hunt: ‘PM backed me to the hilt’ in tearing up mini-budget

13:32 , Miriam Burrell

Chancellor Jeremy Hunt has told Tory MPs that Liz Truss “backed him to the hilt” in tearing up her mini-budget measures and that there are more “difficult decisions” to come.

A read-out from the meeting said: “The Chancellor held a briefing for parliamentary colleagues in the Commons at 1230.

“The Chancellor emphasised the need for stability and said that the PM should be commended for changing tack in the face of the deteriorating global economic situation.

“He said that the PM had backed him to the hilt in making the difficult decisions of which there are more to come.”

Labour granted a Commons urgent question

13:12 , Miriam Burrell

Labour has been granted a Commons urgent question on the economic situation after Liz Truss refused to come to the House after the sacking on Friday of Kwasi Kwarteng.

The question, in the name of Sir Keir Starmer, is directed to the Prime Minister although she can delegate a more junior minister to answer for her.

It is expected to take place at 3.30pm, delaying Chancellor Jeremy Hunt’s statement.

A Labour Party spokesperson said of the Tories: “With the Chancellor junking the majority of its kamikaze budget today, the Prime Minister should have come to the House to make a statement.

“If she had a shred of authority left she would turn up.”

‘The Government’s in shambles’ says Mayor of London

12:47 , Lydia Chantler-Hicks

Sadiq Khan has claimed the Government has “run out of ideas” after Jeremy Hunt ditched most of the remaining policies from Kwasi Kwarteng’s mini-budget.

“The Government’s in shambles – it’s clearly chaos,” the Mayor of London told the PA news agency.

“Families, businesses, investors don’t know from one minute to the next what the Government’s policy is. It’s no way to run an economy, it’s no way to run the country.

“What’s clear now is this Government’s run out of road, it’s run out of ideas. And that’s why it’s so important for them to actually give the British public the chance for voting for a fresh start and call a general election.”

Labour: ‘Tories have lost all credibility'

12:47 , Lydia Chantler-Hicks

Shadow chancellor Rachel Reeves has said the Conservatives “have lost all credibility”.

“The Chancellor said that growth requires ‘confidence and stability’ yet it’s clear that the Tories can’t provide this,” the Labour MP said in a statement.

“There will continue to be a huge cost to families because of the actions of this Tory Government.

“We are still flying blind with no OBR forecasts and no clarity of the impact of their mistakes.

“The humiliating climb-down on their energy plan begs the question yet again – why won’t they bring in a windfall tax on energy producers to help foot the bill?”

Downing Street: ‘Liz Truss is still in charge'

12:40 , Lydia Chantler-Hicks

Downing Street insisted the Prime Minister is still in charge despite Chancellor Jeremy Hunt tearing up her economic strategy.

Asked who was running the country, Ms Truss’s official spokesperson said: “The Prime Minister. She has been working closely with her Chancellor over the weekend to agree this approach.

“Of course there are a raft of other areas on which she will continue to lead the country, not least in our response to the war in Ukraine.”

Cabinet ministers have been invited to No 10 for an informal “reception” on Monday evening as Ms Truss battles to save her premiership.

Liz Truss is providing ‘stability of leadership’, insists PM’s spokesperson

12:38 , Lydia Chantler-Hicks

Asked about the credibility problem Liz Truss now faces after the mini-budget U-turns, her official spokesperson said she was providing “stability of leadership”.

“The Prime Minister is listening to the public,” said the spokesperson.

“She is listening to advice on the markets, she is listening to her colleagues and she is making the necessary difficult decisions to change our approach so that we can provide the economic stability and indeed maintain that stability of leadership which is important.”

Pressed on whether she accepted she had a credibility problem, the spokesperson said: “The Prime Minister is demonstrating that she is able to make the difficult decisions necessary to provide the leadership for this country.”

‘Thank goodness we didn’t act so rashly’ says Nicola Sturgeon

12:29 , Lydia Chantler-Hicks

Scotland’s First Minister Nicola Sturgeon has said “thank goodness we didn’t act so rashly” after Jeremy Hunt announced he is scrapping most of his predecessor’s controversial tax cuts.

Tweeting in response to the new Chancellor’s abandoned reduction in the basic rate of income tax, she said: “Another reminder of the many demands made of @scotgov to immediately match this without any consideration of cost and impact.

“Thank goodness we didn’t act so rashly.”

‘Charting a new course’: PM takes to Twitter after Chancellor’s major U-turn

12:19 , Lydia Chantler-Hicks

Prime Minister Liz Truss insisted her Government’s change of tack “supports and delivers” for people across the country.

In a tweet posted about an hour after her new Chancellor’s statement saw him U-turn on the mini-budget she hatched with former Chancellor Kwasi Kwarteng, Ms Truss said: “The British people rightly want stability, which is why we are addressing the serious challenges we face in worsening economic conditions.

“We have taken action to chart a new course for growth that supports and delivers for people across the United Kingdom.”

Treasury committee chair warns of ‘£40bn gap still to plug’

12:08 , Lydia Chantler-Hicks

Treasury committee chair Mel Stride has praised the Chancellor’s budget U-turns but warns the government could still face a £40 billion black hole in the public finances.

Writing on Twitter, the Tory MP said: “Positive move @Jeremy_Hunt with 2 strong upside surprises for the markets - Inc Tax held at 20% and review of energy price suppt - presume more targeted post April.

“But even after reversing almost all mini budget and raising £6b through IT tax rise prob £40b gap still to plug.”

Fourth Tory MP joins calls for Truss to resign

11:48 , Lydia Chantler-Hicks

A fourth Conservative MP Tory MP has called for Liz Truss to resign, heaping pressure on the Prime Ministers just minutes after her new Chancellor Jeremy Hunt ripped up her tax cutting plan in a bid to reassure financial markets.

Angela Richardson, Tory MP for Guildford, joined Crispin Blunt, Jamie Wallis and Andrew Bridgen in saying the PM should go, adding that while party rules meant she was technically protected from a leadership challenge, they could be changed to force her out.

Ms Richardson told Times Radio it was “no longer tenable” for Ms Truss to remain in No 10 arring that “there are mechanisms” for the PM to be removed and replaced without a drawn out leadership battle.

Pound and bonds rally after Chancellor swings axe at mini-budget

11:38 , Lydia Chantler-Hicks

The pound has strengthened and UK government bonds have rallied further as Jeremy Hunt announced plans to reverse key policies in the former Chancellor’s mini budget.

Sterling rebounded by more than 1.2% to 1.139 against the US dollar shortly after Mr Hunt gave his emergency statement to calm the financial markets.

Yields on 30-year government bonds, or gilts, eased back further by around 10%, as the new Chancellor set out plans to shave off billions of Government debt.

The interest on long-dated bonds hit a low of around 4.32% shortly after the first announcement.

Chancellor: We will take whatever tough decisions are necessary

11:35 , Lydia Chantler-Hicks

“Growth requires confidence and stability and the United Kingdom will always pay its way,” Chancellor Jeremy Hunt said in his statement.

“This Government will therefore take whatever tough decisions are necessary to do so,” he added.

Liz Truss held meeting at 10am to discuss scrapping mini-budget

11:30 , Lydia Chantler-Hicks

Prime Minister Liz Truss held a political Cabinet call at 10am to discuss the decision to scrap the mini-budget measures.

Chancellor Jeremy Hunt set out the “worsening global economic situation, with interest rates rising around the world as monetary policy returns to a sense of normality”, a No 10 source said.

“Because of this, the Government is adjusting its programme while remaining committed to long-term reforms to improve growth such as investment zones and speeding up infrastructure projects.”

Mr Hunt is expected to meet all secretaries of state this week to decide on future spending plans which will then be submitted to the Office for Budget Responsibility on Friday.

Jeremy Hunt: ‘Stability is most important thing right now’

11:28 , Lydia Chantler-Hicks

The Government’s main objective will be ensuring “stability”, the Chancellor has said.

Indicating that some Government spending would have to be cut, Jeremy Hunt said: “The most important objective for our country right now is stability.

“Governments cannot eliminate volatility in markets but they can play their part and we will do so, because instability affects the prices of things in shops, the cost of mortgages and the values of pensions.”

Chancellor says he is ‘extremely confident’ about UK’s economic future

11:27 , Lydia Chantler-Hicks

Tearing up the government’s so-called mini-budget, the Chancellor said he remains “extremely confident” about the country’s long-term economic prospects.

But he added: “Growth requires confidence and stability and the United Kingdom will always pay its way. This Government will therefore take whatever tough decisions are necessary to do so.”

Energy bills support will now only last until April...

11:26 , Lydia Chantler-Hicks

Help with energy bills for households will now only last until April, Jeremy Hunt has announced, along with a review to find a “new approach” that will “cost the taxpayer significantly less”.

The new Chancellor said in his emergency statement: “The biggest single expense in the growth plan was the energy price guarantee.

“This is a landmark policy supporting millions of people through a difficult winter ad today I want to confirm that the support we are providing between now and April next year will not change.

“But beyond that, the Prime Minister and I have agreed it would not be responsible to continue exposing public finances to unlimited volatility in international gas prices.

“So I’m announcing today a Treasury-led review into how we support energy bills beyond April next year. The objective is to design a new approach that will cost the taxpayer significantly less than planned whilst ensuring enough support for those in need.

“Any support for businesses will be targeted to those most affected and the new approach will better incentivise energy efficiency.”

Government spending will be cut, says the Chancellor

11:24 , Lydia Chantler-Hicks

The Chancellor has confirmed Government spending in “some areas” will be cut.

Jeremy Hunt said: “There will be more difficult decisions, I’m afraid, on both tax and spending as we deliver our commitment to get debt falling as a share of the economy over the medium term.

“All departments will need to redouble their efforts to find savings and some areas of spending will need to be cut.

“But as I promised at the weekend, our priority in making the difficult decisions that lie ahead will always be the most vulnerable and I remain extremely confident about the UK’s long-term economic prospects as we deliver our mission to go for growth.”

Tax cut reversals will raise billions, says the Chancellor

11:22 , Lydia Chantler-Hicks

New Chancellor Jeremy Hunt has said his tax cut reversals will raise some £32 billion a year as part of efforts to get the public finances back on track.

In an emergency statement, he said: “The measures I’ve announced today will raise every year around £32 billion.”

Hunt scraps plan to reduce basic income tax

11:20 , Lydia Chantler-Hicks

The Chancellor announced he is scrapping the government’s plan to cut the basic rate of income tax to 19 per cent from April 2023.

“It is a deeply held Conservative value - a value that I share - that people should keep more of the money that they earn,” he said. “But at a time when markets are rightly demanding commitment to sustainable public finances, it is not right to borrow to fund this tax cut.

“So I’ve decided that the basic rate of income tax will remain at 20 per cent and it will do so indefinitely until economic cicumstances allow for it to be cut.”

Chancellor abolishes string of tax measures

11:17 , Lydia Chantler-Hicks

He added: “Whilst we will continue with the abolition of the health and social care levy and stamp duty changes, we will no longer be proceeding with the cut to dividend tax rates, the reversal of off-payroll working reforms introduced in 2017 and 2021, the new VAT-free shopping scheme for non-UK visitors, or the freze on alcohol duty rates.”

Hunt announces U-turn on ‘almost all’ mini-budget tax measures

11:10 , Lydia Chantler-Hicks

Jeremy Hunt has begun his statement, announcing: “We will reverse almost all the tax measures annouced in the growth plan three weeks ago that have not started parliamentary legislation.”

Liz Truss has two weeks to save her premiership, says former Tory chief whip

11:10 , Lydia Chantler-Hicks

Former Tory chief whip Andrew Mitchell has claimed Liz Truss has just a fortnight left to save her premiership.

Pressed on whether Ms Truss would lead her party into the next general election, Mr Mitchell told Times Radio: “I think the next two weeks will be critical in determining the answer to that question.”

The Sutton Coldfield MP downplayed the obstacles to removing the Prime Minister after October 31, when Chancellor Jeremy Hunt is due to set out his medium-term fiscal plan.

“If over the next two weeks it becomes clear to the parliamentary party that the Prime Minister needs to change, or be changed, then the technicalities or the mechanism are not important,” he said.

“The wish of the parliamentary party will assert itself… if she cannot do the job, she will be replaced. I have no idea by who but we haven’t reached that stage yet.”

Support Truss or bring back Boris Johnson, former minister warns Tories

11:07 , Lydia Chantler-Hicks

Former culture secretary Nadine Dorries has warned her colleagues they must support Liz Truss or bring back her predecessor Boris Johnson to avoid a general election.

She tweeted: “There is no unity candidate. No one has enough support.

“Only one MP has a mandate from party members and from the British public – a mandate with an 80 seat majority. @BorisJohnson

“The choices are simple – back Liz, if not bring back Boris or face a GE within weeks.”

Chancellor’s statement due at 11.15am

11:01 , Lydia Chantler-Hicks

Newly appointed Chancellor Jeremy Hunt is expected to deliver his emergency statement on the Government’s fiscal plan at about 11.15am.

The address will be televised from inside the Treasury.

Chancellor’s statement could ‘rescue’ Truss’s leadership, says MP

10:55 , Lydia Chantler-Hicks

A former Conservative chief whip has suggested that Jeremy Hunt could “rescue” Liz Truss’s premiership with his economic statement.

Andrew Mitchell, MP for Sutton Coldfield, told Times Radio Liz Truss “may at this minute be on the start of the upward climb”.

“She’s appointed Jeremy Hunt, he’s going to make a statement shortly… this may be the start of her rescue, if you like, as he puts into place policies that firstly will satisfy the markets,” he said.

“Remember that Jeremy Hunt and I were in the Cabinet when the OBR – the Office for Budget Responsibility – was set up by George Osborne.

“He had a very, very clear understanding of the importance of making clear to the markets that our policies are responsible. And I think that is what Jeremy Hunt will do today.”

Jeremy Hunt has been pictured leaving No 11

10:34 , Lydia Chantler-Hicks

Jeremy Hunt has left Number 11, the official residence of the Chancellor of the Exchequer.

He was seen getting into a silver Land Rover at 10.27am.

Mr Hunt is due to give a televised statement from inside the Treasury at around 11.15am prior to his announcement to the House of Commons this afternoon.

What is the Chancellor expected to announce in his statement?

09:51 , Lydia Chantler-Hicks

New Chancellor Jeremy Hunt is expected to announce he is scrapping a number of Prime Minister Liz Truss’s financial plans, in his emergency statement at 11am.

It is thought he will roll back more tax cuts and other unpopular measures from the mini-budget announced by his predecessor Kwasi Kwarteng, including the proposal to cut the basic rate of tax by 1p. It’s believed that this 1p basic tax rate cut will be delayed to 2024 instead.

In light of the pound falling significantly, there will likely also be a significant focus on the currency and gilt markets. This comes after the billions of pounds worth of tax cuts proposed by Mr Kwarteng spooked investors.

Mr Hunt has already warned that taxes will have to rise and public spending will be squeezed to address the black hole in the public finances opened up by Mr Kwarteng’s £45 billion mini-budget tax giveaway.

Read more here.

Chief Whip and catering supplies company arrive at No 10

09:35 , Lydia Chantler-Hicks

Chief Whip Wendy Morton was seen arriving at 10 Downing Street at 9am.

She said good morning to the photographers and journalists waiting outside before heading into the building.

About 25 minutes later, a van for a catering rental company arrived and parked in Downing Street.

The business, called Jones, supplies “tableware, furniture and kitchen equipment for corporate and private events”, according to its website.

Ex-prisons minister urges Liz Truss to step down

09:27 , Lydia Chantler-Hicks

Former prisons minister Crispin Blunt has urged Liz Truss to quit as Prime Minister, claiming she is too unpopular to take the “difficult decisions” needed for the country.

Referring to Boris Johnson’s resignation speech in July, Conservative MP Mr Blunt said the herd instinct which propelled Ms Truss’s predecessor from office has to “move again”.

He told Times Radio: “Single-figure approval ratings with the public is not going to be able to carry the authority to give the message to the public, the markets, media, her colleagues about the difficult decisions that are going to have to be made. Not just now, but over the course of the next two years.”

Mr Blunt is one of several Tory MPs who have broken rank to call for Liz Truss’ resignation.

Gilt yields surge ahead of Jeremy Hunt’s emergency statement

09:10 , Lydia Chantler-Hicks

Gilt yields surged this morning as UK Government bonds were in strong demand this morning ahead of the new Chancellor’s statement about the Medium Term Fiscal Plan.

In early trading the yield on the benchmark 10 year gilt was down as much as 26 basis points at 4.07 per cent, while the 30 year gilt yield was 29 basis points lower 4.49 per cent. It was the first morning of trading after the suspension of the Bank of England’s emergency repurchase programme.

New Chancellor spells fresh chance for Liz Truss, says Tory MP

09:06 , Lydia Chantler-Hicks

Former deputy prime minister Damian Green says Jeremy Hunt’s appointment as Chancellor is “already beginning to reassure the markets” - and he hopes his statement will give Liz Truss’s Government a chance to “start again”.

Asked on BBC Radio 4’s Today programme how the Prime Minister can retain her position, the Conservative MP said: “She is a pragmatist – she’s realised that the first budget didn’t work in spectacular fashion, so she’s now taken the sensible view that we will now try something else, and she’s appointed a very sensible Chancellor in Jeremy Hunt.

“I obviously don’t know what he’s going to say, but clearly what he’s going to do is already beginning to reassure the markets, and I hope will continue to do so afterwards. That means we can hopefully put the past few weeks behind us and start again.

“I think the appointment of Jeremy Hunt and what he’s done so far shows us a way that we can [succeed as a Government] and if we continue on that course then we will get back the stability that everyone is crying out for.”

If mini-budget is abandoned Truss should consider her position, says Tory MP

08:53 , Lydia Chantler-Hicks

One Tory MP elected in 2019 told the Standard today: “If [Jeremy Hunt] rips up the mini-budget this morning then Liz Truss has to seriously consider her position.

“I don’t think there is much she can say, I think she needs to start listening to her MPs.”

Tories lag behind Labour on 14 out of 15 key policies, poll shows

08:49 , Lydia Chantler-Hicks

Jeremy Hunt’s huge task to salvage the Tories’ shredded reputation on managing the economy, tax, pensions and the cost-of-living crisis has been laid bare by a new poll showing Labour significantly ahead on all these issues.

As Liz Truss battles to stay Prime Minister just 42 days after entering No10, the Ipsos survey for the Standard exposes the full scale of damage to the Tory party wreaked by Kwasi Kwarteng’s mini-budget.

Read the full story here.

Liz Truss pictured in Downing Street

08:36 , Lydia Chantler-Hicks

Prime Minister Liz Truss has been photographed in Downing Street this morning, as she faces pressure from within her own party to resign.

Veteran Tory MP: ‘Jeremy Hunt is de facto prime minister’

08:28 , Lydia Chantler-Hicks

Sir Roger Gale has said Liz Truss’s political weakness means that new Chancellor Jeremy Hunt is now “de facto prime minister”.

The backbench Conservative MP who represents North Thanet told Sky News: “I think Jeremy Hunt has taken on the job...on his own terms.

“He’s said he will do it, but he will only do it if he can do what he believes to be necessary to stabilise the markets, to stabilise the economy and to get the show back on track.

“I think Jeremy Hunt is de facto prime minister at the moment.

“It’s quite clear that all the shots are now being called from No 11, and in a way I’m happy to say that I’m very pleased that they are because I think that will stabilise the markets and I hope that we can find a way forward for the United Kingdom.

“If he gets this wrong, then we’re going to go hell in a handcart but if he gets it right, then we can emerge from this, I think, better and stronger and we can start to move forward in the direction that we all really want to go.”

Electing Liz Truss was ‘wrong’ decision, suggests Conservative MP

08:20 , Lydia Chantler-Hicks

A veteran Conservative MP has suggested the party membership made the “wrong” decision when they elected Liz Truss as leader in September.

North Thanet MP Sir Roger Gale told Sky News: “I think Members of Parliament probably have a better perspective of both the economic situation and the personalities than the general membership.

“For very good reason – we know them, we work with them day by day.

“The general membership doesn’t and that’s understandable, and I don’t think we should...blame...the membership for getting it wrong.”

Sir Roger, who did not vote for either Ms Truss or Rishi Sunak in the final leadership ballot, added: “It was not my choice, but we have to accept we live in a democracy. We accept the situation as it is.”

He said replacing the Prime Minister would require a “coronation”, but said: “At the moment I see no single agreed candidate within the party”.

Former treasury official backs Chancellor’s statement decision

08:14 , Lydia Chantler-Hicks

Former Treasury top mandarin Lord Macpherson has backed Mr Hunt’s decision to make an emergency Commons statement on his tax and spend plans.

BoE intervention boosted resilience in bond market

08:12 , Lydia Chantler-Hicks

The Bank of England has said its bond-buying programme which closed on Friday has “enabled a significant increase in the resilience of the sector”.

The central bank launched a scheme to purchase up to £65 billion of UK government bonds - called gilts - in order to help stabilise prices amid a sell-off amid concerns over unfunded tax cuts in the former chancellor’s mini-budget.

Around £19.3 billion worth of gilts were purchased in total by the Bank of England through the programme.

Tory MP: Allow Truss and Chancellor time to end party’s ‘psychodrama'

08:01 , Lydia Chantler-Hicks

A Tory MP has pleaded with his colleagues to stop the “psychodrama” ripping through their party and give Liz Truss and new Chancellor Jeremy Hunt “space” to deliver their economic plan.

Andrew Bowie, MP for West Aberdeenshire and Kincardine, tweeted: “We owe the British people a period of calm, steady government in the national interest. We need to give the new Chancellor time and space to calm the markets and present his economic plan. What we don’t need is another sequel added to the Conservative psychodrama.”

Pound surges higher ahead of new Chancellor’s emergency budget plan

07:56 , Lydia Chantler-Hicks

The pound has jumped higher following news Jeremy Hunt is to make an emergency statement this morning to calm the chaos in the financial markets.

Recap: Could the Tories force Liz Truss to quit?

07:51 , Lydia Chantler-Hicks

Pressure is mounting on Liz Truss to stand down as Prime Minister, after three Conservative MPs openly called for her resignation on Sunday.

But Conservative Party rules currently forbid a confidence vote during a Prime Minister’s first year in office, which for Ms Truss remains 11 months off. Meanwhile, the next general election is not due until late 2024.

So could she be forced to quit? And if so, how? Read the full run-down here.

Rishi is the key to success, says Tory MP

07:40 , Lydia Chantler-Hicks

An MP who backed Rishi Sunak in the Tory leadership contest has urged Liz Truss to appoint the former chancellor back to the Cabinet.

Andrew Bowie, Conservative MP for West Aberdeenshire and Kincardine, told Times Radio: “I think that if we are going to bring the party back together, govern in the national interest and go on to do good things as a Government (we must) demonstrate the ability to reach out across the divide within the party.

“That means having the best brains and the best talents within Government – that includes, obviously, Rishi Sunak.”

Emergency statement ‘evidence of panic’, says Labour

07:36 , Lydia Chantler-Hicks

Shadow treasury chief secretary Pat McFadden says Chancellor Jeremy Hunt’s decision to make an emergency statement was a sign of panic in the Government.

“I think it is evidence of the panic that the Government is in and the damage that has been caused over the last few weeks. Clearly ministers are now terrified of market reaction,” he told BBC Radio 4’s Today programme.

“They have concluded that they cannot wait until October 31. The country couldn’t carry on for the next two weeks in the way that we have been going.”

In an apparent further sign of the turmoil in the Government, Work and Pensions Secretary Chloe Smith who had been expected to carry out a normal round of broadcast interviews this morning did not appear.

Jeremy Hunt statement this morning

07:30 , Sarah Harvey

Jeremy Hunt to make statement at 11am before he addresses the Commons at 3.30pm.

Recap: Pressure mounts on Liz Truss as three Tory MPs call on her to quit

06:47 , Sarah Harvey

Crispin Blunt, Andrew Bridgen and Jamie Wallis all called on the Prime Minister to quit on Sunday, while other senior figures within the parliamentary party expressed deep unease with Ms Truss's leadership but stopped short of calling for her to go.

Mr Wallis accused Ms Truss of “very basic and avoidable errors” while Mr Bridgen told the Telegraph that the country “could not carry on like this” and that the British public “deserved better”.

Read the full wrap here.

Criticism from veteran Thatcherite former Cabinet minister

06:45 , Sarah Harvey

Treasury Committee chairman reacts

06:32 , Sarah Harvey

Mel Stride has responded to the news that Jeremy Hunt will make a statement today:

Treasury statement in full

06:24 , Sarah Harvey

Here’s the Treasury statement in full:The Chancellor will make a statement later today, bringing forward measures from the Medium-Term Fiscal Plan that will support fiscal sustainability.

He will also make a statement in the House of Commons this afternoon.

This follows the Prime Minister’s statement on Friday, and further conversations between the Prime Minister and the Chancellor over the weekend, to ensure sustainable public finances underpin economic growth.

The Chancellor will then deliver the full Medium-Term Fiscal Plan to be published alongside a forecast from the independent Office for Budget Responsibility on 31 October.

The Chancellor met with the Governor of the Bank of England and the Head of the Debt Management Office last night to brief them on these plans.

Good morning

06:22 , Sarah Harvey

Good morning, and welcome to the Standard’s politics live blog on Monday, October 17.

The Treasury has just announced that Chancellor Jeremy Hunt will make a statement today, bringing forward measures from the medium-term fiscal plan that will support fiscal sustainability.In a statement, the Treasury said the Chancellor was fast-tracking the plans - which will be released in full on October 31 - following conversations with the Prime Minister over the weekend.

It said Mr Hunt had also met with the Governor of the Bank of England and the Head of the Debt Management Office on Sunday night to brief them on the plans.