Kwarteng says he is ‘not going anywhere’
The chancellor, Kwasi Kwarteng, said his “total focus is on delivering on the mini-budget” in response to speculation about a U-turn on the measures.
Kwarteng said he is “not going anywhere” and refused to rule out any changes in the future. He acknowledged that there was “some turbulence” after the mini-budget but said it’s a “very dicey situation globally”.
Speaking from an International Monetary Fund summit, he said:
I speak to Number 10, I speak to the prime minister all the time – and we are totally focused on delivering the growth plan.
Asked whether Liz Truss will be prime minister next week and whether he will remain chancellor, Kwarteng replied:
Absolutely 100%, I’m not going anywhere.
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Priti Patel: Market forces could make mini budget U-turn unavoidable
Former home secretary Priti Patel has become the latest high-profile Tory MP to suggest the government could be forced into a further U-turn over the mini-budget.
In an interview with Sky News, due to be aired in full later, Patel was asked if Liz Truss’s commitment not to raise corporation tax should be reversed to calm the markets.
“There is an irony to this,” Patel said.
“In that market forces will probably dictate some of these changes now.
“The market is going to dictate this, primarily because we want to see stability. Stability is absolutely crucial, for everyone to carry on living their lives, for the institutions to function, but actually for the British people to have the stability that they need in their lives as well.
“And by that, as well, I mean mortgages, interest rates and all those crucial, crucial levers.”
UK government bonds and the pound rallied amid speculation that Liz Truss’s government could be forced to U-turn on its unfunded tax cut plans.
Pressure on gilts – UK government bonds – also eased as the Bank of England sought to steady market sentiment by increasing its bond-buying activity ahead of a Friday deadline.
According to reports, No 10 and the Treasury are holding talks over whether to abandon more of the Government’s £43 billion tax-cutting plan which could include reversing the decision to cancel planned rises in income tax.
Foreign secretary James Cleverly earlier declined to rule out further U-turns, but insisted the government will “absolutely stick” to its tax-cutting principles.
The prime minister’s official spokesman made clear there will be no further changes.
Julia Kollewe
The number of mortgage defaults are expected to rise in the coming months, according to Bank of England data released on Thursday, while the number of new loans will continue to fall amid warnings that the “golden era” of cheap deals is ending.
The UK central bank’s latest quarterly credit conditions survey paints a gloomy picture, with the number of mortgage deals already falling before the chancellor’s mini-budget on 23 September.
Kwasi Kwarteng’s package of unfunded tax cuts led to chaos for homebuyers, with hundreds of fixed-rate deals withdrawn over the space of a few days, before lenders returned with significantly more expensive deals.
Shadow chancellor Rachel Reeves said that while there were “global factors at play” in the economic crisis it was vital that “in that environment, don’t fan the flames”.
The government are behaving like pyromaniacs, setting ablaze the UK economy,” she told the PA news agency.
“It is ordinary working people who are paying the price for that.”
Asked if chancellor Kwasi Kwarteng was on borrowed time, she said: “The Prime Minister and Chancellor introduced this package of measures together.
“The Prime Minister has been in office for just one month and has already caused so much damage.
“The public are sick and tired of it, they want the Government to think again and to U-turn, and if the Government aren’t capable of providing the leadership the country needs, Labour absolutely is.”
Ministers have been accused of “escalating harm to patients” by “failing to properly invest in or resource” the NHS, the Guardian’s Andrew Gregory reports.
“Our NHS is falling apart before our eyes”, the chair of the BMA, Prof Philip Banfield, said.
His remarks come as the latest figures show the number of people waiting for hospital treatment has hit a record high of seven million in England.
Breaking: The British Medical Association, @TheBMA, accuses ministers of “escalating harm to patients” by “failing to properly invest in or resource” the NHS, warning that “nowhere near enough is being done to save it,” and as a result, “our NHS is falling apart before our eyes”.
— Andrew Gregory (@andrewgregory) October 13, 2022
The international trade secretary, Kemi Badenoch, has urged fellow Tory MPs to unite behind Liz Truss and the government’s growth plans.
She said she agreed with the foreign secretary, James Cleverly, that “to even talk about changing the leader at this time would be disastrous”.
Speaking during a visit to a distillery in East Lothian, Badenoch dismissed talk of a general election. She said:
I’m very focused on the prime minister’s growth agenda, selling exports and making sure that we continue to grow and create jobs for people. That is absolutely not the sort of thing that is on my mind at all.
John Stevens from the Daily Mirror quotes Treasury sources as saying that Kwasi Kwarteng has not left Washington DC.
The chancellor is not attending an IMF meeting of G20 finance ministers because he is in a bilateral meeting with another finance minister, he said.
Kwasi Kwarteng has NOT fled Washington DC, according to Treasury sources
He’s not in main IMF meeting right now as he’s taking part in a bilateral meeting with another finance minister
— John Stevens (@johnestevens) October 13, 2022
Downing Street has refused to comment on reports that discussions are ongoing at No 10 on U-turns in the government’s mini-budget.
Asked whether an imminent change is possible, a No 10 spokesperson said
Again, I just have to repeat that our position hasn’t changed and the Chancellor was very clear that he and the PM are working to deliver the growth plan.
Asked if talks are being held on possible U-turns, the official said:
Again, work is ongoing between the Chancellor and the prime minister, as you’d expect, ahead of the medium-term fiscal plan. The focus of both the Chancellor and the PM are on delivering the growth plan and the position has not changed.
On whether there had been discussion about dropping the corporation tax cut, they said:
I wouldn’t comment on meetings the prime minister has.
A former Conservative chief whip, Julian Smith, has cryptically tweeted the dictionary definition of the word “confidence”.
Confidence
/ˈkɒnfɪd(ə)ns/noun
11. ⁰the feeling or belief that one can have faith in or rely on someone or something.— Julian Smith MP (@JulianSmithUK) October 13, 2022
The chancellor, Kwasi Kwarteng, reportedly did not attend a meeting of G20 finance ministers at the IMF in Washington.
Sky News’ Mark Stone says the Bank of England governor, Andrew Bailey, was at the meeting but was told Kwarteng’s deputy would stand in for him.
G20 Finance Ministers & Bank Chiefs are in a long meeting at IMF now.
BoE Governor Bailey there but Chancellor is not.
Treasury team seen outside meeting telling organisers that Kwarteng’s deputy will stand in.
We know that Kwarteng did meet G20 counterparts for breakfast. pic.twitter.com/CTEgE70alh— Mark Stone (@Stone_SkyNews) October 13, 2022
Asked if he knew why the chancellor was not present at the meeting, Bailey said: “That’s a question for the chancellor.”
The Bank of England governor, Andrew Bailey, just left the G20 finance ministers meeting at the IMF.
I asked him if he knew why the chancellor wasn’t in attendance.
“That’s a question for the chancellor” he told me.
— Mark Stone (@Stone_SkyNews) October 13, 2022
The head of the International Monetary Fund (IMF), Kristalina Georgieva, was speaking to reporters in Washington earlier today where she was asked about reports of a UK government U-turn over its mini-budget.
Speaking before Kwasi Kwarteng’s interview, Georgieva said it is sometimes right for a “recalibration” of policies.
She said:
I do believe it is correct to be led by evidence, so if the evidence is that there has to be a recalibration, it is right for governments to do so.
She added:
Don’t prolong the pain – make sure actions are coherent and consistent.
While the chancellor, Kwasi Kwarteng, has insisted “our position has not changed” in his earlier interview, the Guardian’s Jessica Elgot points out that this isn’t the same as saying “our position will not change”.
The key thing is that “our position hasn’t changed” is not the same as “our position will not change.”
— Jessica Elgot (@jessicaelgot) October 13, 2022
A former cabinet minister has told the News Agents podcast’s Jon Sopel that Liz Truss “has unleashed hell on this country”.
Sopel says the language being used by senior Tories about the PM is like nothing he has seen before.
A cabinet minister until a few weeks ago has just told me @trussliz ‘has unleashed hell on this country.’ The language being used by senior Conservatives, the incredulity, the cold fury is like nothing I’ve seen in decades of covering UK politics
— Jon Sopel (@jonsopel) October 13, 2022
Aubrey Allegretti
Despite the chaos in Downing Street as officials rake over bits of the mini-budget, Liz Truss put aside around 50 minutes for one of her first “listening exercises” with a handful of Tory MPs.
She sought to defuse tensions in the party by inviting them to chat about issues and pet projects in their area over tea and Pret a Manger sandwiches.
The PM and a seemingly random assortment of backbenchers from different intakes and regions chatted predominantly about infrastructure, sources told the Guardian.
One Truss supporter who attended said she was “very buoyant”, but a sceptic said it was just incredibly awkward.
“It’s so fucking transparent,” they sighed. “We’re only there because she’s in trouble.”
There was no mention of the elephant in the room – the looming prospect of further U-turns on the mini-budget.
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