Labour leader says UK is ‘crying out for clear leadership’ and his party ‘must provide it’
Keir Starmer has criticised the “grotesque chaos” of recent weeks and said the government “no longer has a mandate from the British people”.
The Labour leader said there were no historical precedents for the ongoing economic turmoil and that the prime minister, Liz Truss, would not be able to “fix the mess she has created”.
Continue reading...PM’s move to replace chancellor and commit to raising corporation tax fails to placate markets or Tory MPs
Liz Truss is desperately clinging to her premiership after she sacked her chancellor and ripped up the mini-budget but failed to calm the financial markets or furious Conservative MPs.
In a humiliating reversal, the prime minister backed down on plans to scrap an £18bn rise in corporation tax and replaced Kwasi Kwarteng as chancellor with Jeremy Hunt.
Continue reading...Source close to sacked chancellor briefs Times that ‘wagons are still going to circle’ around embattled prime minsiter
The Conservative peer, Ed Vaizey, said he disagreed with the international trade secretary, Greg Hands, who earlier said Kwasi Kwarteng’s early return is not unusual. “It is quite unusual for this to happen,” he said.
Speaking to Sky News, Vaizey said the chancellor cutting his trip to the US short is “not a good sign”. He said:
I’m afraid the chancellor coming back a day early doesn’t fill one with confidence.
The fact that people were speculating about the prime minister’s leadership this early in her premiership is not ideal, but I think he’s just got to bite the bullet. He’s got to try to give the markets confidence in the British economy.
If he can do that then perhaps he can say: ‘Well, I had to do some difficult choices, slightly humiliating choices, but the result is stabilisation and I can move forward.’
Continue reading...Truss ally has experienced a dramatic reversal of fortune after five weeks and three days in the job
When Kwasi Kwarteng became chancellor on 6 September it seemed a logical career progression. Deemed a politician imbued with economic doctrine, even his critics conceded he was determined and intellectually imposing. Five weeks and three days later, he is gone.
The newly restored backbench MP for Spelthorne in Surrey is not the shortest-serving chancellor of modern times, but only because the holder of that unwelcome title, Iain Macleod, died from a heart attack a month into his tenure in 1970.
Continue reading...Former foreign secretary and leadership contender is back in cabinet, in stunning reversal of fortune
Jeremy Hunt has been appointed as Liz Truss’s new chancellor, in a stunning reversal of political fortune and a sign that the beleaguered prime minister wants to reach out to other sections of the Conservative party.
Hunt, the former foreign secretary and health secretary, has twice tried unsuccessfully to become Conservative leader.
Continue reading...Chancellor does not rule out increasing corporation tax when asked about whether government will perform U-turn
The Home Office has taken the modern slavery brief away from the minister responsible for safeguarding and classed it as an “illegal immigration and asylum” issue, updated online ministerial profiles show.
The move is seen as a clear sign that the department is doubling down on Suella Braverman’s suggestion that people are “gaming” the modern slavery system and that victims of the crime are no longer being prioritised.
The largest single group of modern slavery victims under the referral system last year were British children – including those who were exploited through county lines. The evidence shows the majority of exploitation takes place in the UK rather than across borders.
The government should be treating this as an enforcement and safeguarding issue and taking stronger action against the crime of modern slavery wherever it takes place.
Continue reading...Ed Miliband criticises Liz Truss’s ‘anti-green-energy dogma’ after plans to ban solar projects revealed
Labour has criticised prime minister Liz Truss’s plan to ban solar power from most of England’s farmland and vowed to treble the renewable energy source in its first term.
Ed Miliband, the shadow climate secretary, will visit a solar farm on Friday. He is to lay out his opposition to plans by Truss and her environment secretary, Ranil Jayawardena, who the Guardian revealed earlier this week are hoping to ban solar from about 41% of the land area of England, or about 58% of agricultural land.
Continue reading...Speculation that reversal on leadership campaign pledge risks split with her chancellor, Kwasi Kwarteng
Liz Truss has bowed to intense pressure from Conservative MPs and the markets by agreeing to redraw her mini-budget, paving the way for a major U-turn on her signature corporation tax cut.
In another serious blow to her authority as prime minister, government sources told the Guardian that a climbdown on the plan to scrap the rise in corporation tax was now “on the table”.
Continue reading...Corporation tax plans likely to be latest to be dropped – bad news for Kwarteng’s credibility, but good for his balance sheet
Liz Truss is on the verge of reversing one of the last major pillars of her chancellor’s disastrous September mini-budget.
While Kwasi Kwarteng mingles with finance ministers at the International Monetary Fund gathering in Washington DC, discussions are taking place in London that would see the promise to freeze corporation tax rates binned. There is also speculation about dropping smaller measures including a more generous tax treatment of share dividends. These U-turns would come hard on the heels of the humiliating climbdown on Kwarteng’s promise to scrap the 45p top rate of tax.
Continue reading...Reversing key plank of her leadership pitch would be much bigger humiliation for Liz Truss than 45p rate U-turn
The clamour among Conservative MPs for a third U-turn by Liz Truss started the same as the others: one MP begins as an outrider, backed by some party veterans or ex-cabinet ministers, and the question catches alight across broadcasters who ask every MP they see. Soon enough, it is received wisdom.
Most MPs who are squeamish about deposing their third prime minister had hoped that they would see change in the markets and contrition from No 10 and 11 after the U-turn on the 45p rate. Over the course of the past week, it has been clear to them that will not happen.
Continue reading...Experts take a forensic look at the PM’s promise to axe to up to 2,400 laws on British statute books
Liz Truss has promised to “consign to history” all EU red tape within the next year, axing to up to 2,400 laws on British statute books.
It was not just party conference rhetoric. Her government is planning to pass legislation to give itself the power to simply switch off 40 years of EU harmonisation legislation at the stroke of midnight 31 December 2023. No list of laws targeted has been published.
Continue reading...PM wants to prevent panels on 58% of farmland but business secretary says renewables need to be boosted
Liz Truss is facing a rebellion from Jacob Rees-Mogg’s business department over plans to ban solar power from most of England’s farmland.
The prime minister and her environment secretary, Ranil Jayawardena, want to ban solar from about 41% of the land area of England, or about 58% of agricultural land, the Guardian revealed earlier this week.
Continue reading...Statement from No 10 comes straight after PM told MPs she was ‘absolutely’ committed to avoiding public spending cuts
Sajid Javid, the former Tory chancellor, has been speaking at an event organised by the Legatum Institute thinktank this morning. As Chris Smyth from the Times reports, Javid said the turmoil in the markets was caused by the fact that the tax cuts in the mini-budget went “way beyond” what Liz Truss promised during the leadership campaign, and by the fact that her energy bills bailout was also much bigger than expected.
The government has drawn up a plan to cap the unit cost of gas and electricity for two years. Labour proposed its own plan to freeze energy bills, but it only proposed a commitment for six months.
Continue reading...PM suggests borrowing will rise as she surprises MPs by saying she has no plans to cut public spending
Liz Truss has said the Conservatives will push ahead with tax cuts without cutting public spending, instead allowing borrowing to rise over the next few years.
Senior economists had warned on Wednesday that such a strategy, if set out by Kwasi Kwarteng in the chancellor’s fiscal plan at the end of this month, would be likely to spook investors, creating renewed market turmoil.
Continue reading...Research from the Joseph Rowntree Foundation shows impact of increasing benefits in line with earnings, not inflation
At least one in five working-age families in most UK constituencies – including in Liz Truss’s seat – would lose out by hundreds of pounds on average if real-terms benefit cuts go ahead, a study has found.
The scale of the impact of a below-inflation rise on already struggling households and by extension, local shops and businesses, is revealed in a study by the Joseph Rowntree Foundation (JRF). It would amount to the biggest-ever real terms cut to benefits in a single year.
Continue reading...Prime minister accused of ‘another screeching U-turn’ having previously rejected calls to impose levy
Renewable power companies will have their revenues capped in England and Wales, after the government bowed to pressure to clamp down on runaway profits.
The announcement late on Tuesday night provoked immediate accusations that Downing Street had performed “another screeching U-turn” – having previously rejected calls to impose a windfall tax on power giants.
Continue reading...Sterling falls more than a cent to below $1.10 after Andrew Bailey tells pension firms they have ‘got to get this done’
The pound has fallen sharply against the dollar after Andrew Bailey warned the Bank of England would not extend its emergency intervention in financial markets beyond this week, after the turmoil sparked by the government’s mini-budget.
Sterling skidded by more than a cent against the dollar to below $1.10 after the Bank’s governor insisted the £65bn scheme to purchase UK government bonds would not be continued beyond the deadline on Friday.
Continue reading...Latest updates: Labour leader hoping to put party on war footing ahead of next election
In the supreme court Dorothy Bain KC, the lord advocate, the Scottish government’s most senior law officer, is now setting out her case.
Here is the 50-page submission to the court setting our her case that was released in July.
Despite the political context of this reference, the questions the court has to decide are limited to technical questions of law. The court will decide them by applying legal principles.
The court will require time after the hearing to prepare its judgement. The hearing is the tip of the iceberg. We also have more than 8000 pages of written material to consider.
Therefore, as usual, is likely to be some months before we get our judgement.
Continue reading...Veteran official gets permanent secretary role instead of reformer as fiscal plan is brought forward by three weeks
Liz Truss has overruled Kwasi Kwarteng’s top appointment at the Treasury and handed the role to a veteran Treasury official, one of a series of moves designed to calm markets and backbenchers.
It was also announced that the chancellor will set out plans to shore up the public finances three weeks earlier than planned and publish long-awaited forecasts by the Office for Budget Responsibility at the same time.
Continue reading...Exclusive: Tory MPs warn PM she would lose vote on increasing benefits only in line with earnings rather than inflation
Liz Truss is teetering on the edge of performing another big U-turn as Tory MPs warned she would lose a vote on delivering a real-terms cut to benefits while new research showed the move could push an extra 450,000 people into poverty.
Despite desperate pleas for party unity from senior ministers after weeks of bitter infighting, the row over welfare threatened to overshadow the prime minister’s attempt to reassert her authority when the Commons returns from recess on Tuesday.
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