A summary of today's developments
The new chancellor, Jeremy Hunt, is set to delay a 1p cut in income tax to help plug a black hole in the public finances that had reached £72 billion, according to the Sunday Times. Hunt is expected to announce that plans to reduce the basic rate of income tax next April will be pushed back by a year.
Long Covid could be contributing to labour shortages in the UK, the governor of the Bank of England has said. Andrew Bailey made the comments at a G30 seminar in Washington.
Bailey said he spoke to the new chancellor, Jeremy Hunt, yesterday and they had an “immediate meeting of minds”. He said there was a “very clear and immediate meeting of minds between us about the importance of fiscal sustainability”.
In his speech, Bailey said that inflationary pressures will need a “stronger response” than previously anticipated in August. He said the bank ”will not hesitate” to raise interest rates to meet the inflation target.
The chancellor has admitted that his medium-term fiscal plan to be unveiled on 31 October will in effect be a full budget. Jeremy Hunt told ITV’s Robert Peston on Saturday that he would “pretty much” be delivering a “proper” budget.
Keir Starmer has accused Liz Truss of “grotesque chaos”, referencing Neil Kinnock’s famous 1985 conference speech. Speaking in Barnsley, an area where he said Labour would have to win 14 battleground seats, he referenced the “grotesque chaos of a Tory prime minister handing out redundancy notices to her own chancellor”.
Actor Miriam Margolyes said she wanted to tell Jeremy Hunt “Fuck you, bastard” after appearing on Radio 4 immediately after the new chancellor. She made the comments on the Today programme at the end of an interview about the death of Robbie Coltrane.
Jeremy Hunt said the PM wants him to be “completely honest” with the country and that there will be difficult decisions ahead. He refused to specify which departments, but he said he will require “all departments”, including health, to make savings, and that some taxes will have to go up.
Hunt said the Liz Truss administration has made “mistakes” and that there are “difficult decisions ahead”. He was speaking on Sky News.
Labour has signalled it will be boycotting the World Cup in Qatar next month, citing the treatment of construction workers and the criminalisation of same-sex relationships.
Updated
Senior Conservatives will this week hold talks on a “rescue mission” that would see the swift removal of Liz Truss as leader, after the new chancellor Jeremy Hunt dramatically tore up her economic package and signalled a new era of austerity, writes Toby Helm and Michael Savage.
A group of senior MPs will meet on Monday to discuss the prime minister’s future, with some wanting her to resign within days and others saying she is now “in office but not in control”. Some are threatening to publicly call on Truss to stand down after the implosion of her tax-cutting programme.
In a rearguard action to prop up the prime minister, her cabinet allies tonight warned MPs they would precipitate an election and ensure the Tories were “finished as a party” if they toppled a second leader in just a few months.
