Government departments will be asked to make spending cuts in an effort to balance the budget, it has been reported. It comes as the financial markets have gone into turmoil following last week's mini-budget.
The BBC says the Chief Secretary to the Treasury, Chris Philp, will "write to government departments in the coming days about finding spending efficiencies." The report follows moves by a Treasury minister to defend Chancellor Kwasi Kwarteng's mini-budget, which featured a £45 billion package of tax cuts.
Financial Secretary Andrew Griffith told Sky News: "We think they are the right plans because those plans make our economy competitive."
He added: "Get on and deliver that plan. That’s what I, the Chancellor and my colleagues in Government are focused on is getting on and delivering that growth.
"That is what is going to allow consumers to benefit. In the meantime, we are protecting every household and every business from the biggest macro shock out there at the moment, which is the cost of energy."
However, Labour leader Sir Keir Starmer said he wants Parliament to be recalled immediately but stopped short of calling for Prime Minister Liz Truss to resign. He told BBC News: “I’m leader of the opposition, of course we want an election as soon as possible but there’s an immediate crisis that’s got to be dealt with.”
Sir Keir also declined to call on the Prime Minister to sack Mr Kwarteng, but told ITV News that Parliament should be recalled "as soon as possible - tomorrow" and that the mini-budget should be reversed "before any more damage is done."
The Bank of England said it would launch an emergency programme to buy government bonds – known as gilts – “on whatever scale is necessary” to try to bring down soaring UK public borrowing costs. It sent sterling into the lurch, which dipped to around 1.05 against the US dollar immediately after the announcement.
However, the pound had edged back up to around 1.08 by the time European markets closed. The FTSE 100 index also fell more than 2% in late morning on Wednesday – down nearly 145 points at 6841.35 – but by the end of the day the index had recovered its losses and was above the 7,000 mark.
