Kwarteng dismisses row generated by 45% tax plan as ‘a little turbulence’
Kwarteng says the plan put forward 10 days ago has caused “a little turbulence”. He goes on: “I get it,” he says. The government listened.
I can be frank. I know the plan put forward only 10 days ago has caused a little turbulence.
I get it. I get it. We are listening and have listened, and now I want to focus on delivering the major parts of our growth package.
He was probably being ironic when he talked of “a little turbulence”, but this line makes him sound like Jacob Rees-Mogg. (See 3.57pm.)
Key events
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Badenoch urges Tories to unite behind Truss, and to express concerns in private, not through media
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Lockdown at Tory conference lifted after security alert lasting around 90 minutes
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Kwarteng’s speech – verdict from Twitter commentariat
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Kwasi Kwarteng’s speech – snap verdict
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Kwarteng pledges to review, replace or repeal retained EU law ‘holding our country back’
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Kwarteng dismisses row generated by 45% tax plan as ‘a little turbulence’
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Kwarteng starts his speech to Tory conference
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Rees-Mogg claims 45% tax rate U-turn not significant
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Truss picked ‘cronies off backbenches’ for cabinet, says Heseltine
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Irish PM Micheál Martin says Steve Baker’s Brexit apology to EU and Ireland ‘very, very helpful’
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Why Tory rebels could find it harder to defeat PM over benefits or spending cuts
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Schools minister confirms intention to lift ban on new grammar schools in England before election
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Kwarteng set to address Tory conference with his authority on the line after 45% tax rate U-turn
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UK and EU to resume technical talks on Northern Ireland protocol this week
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Even with tax U-turn, richest families still gain 40 times as much as poorest ones from mini-budget, says thinktank
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Labour says it would be ‘grotesque’ not to increase benefits in line with inflation
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Former DWP secretary Esther McVey says it would be ‘huge mistake’ not to raise benefits in line with cost of living
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Former culture secretary Nadine Dorries says Truss should call election if she wants mandate for new agenda
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Tory mayor Ben Houchen says U-turn on 45% tax rate does not wholly solve problem because ‘damage is already done’
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No 10 says Truss still has confidence in chancellor
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Gove says he’s now willing to vote for mini-budget – but still unhappy about prospect of benefits not rising with inflation
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Fracking ‘not going to happen’ because communities don’t support it, says Damian Green
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Liz Truss needs six to 12 months of hard work ‘to persuade public she’s competent’, says Damian Green
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TUC accuses Truss of breaking promise not to return to austerity
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45% tax rate U-turn will have ‘essentially no effect on fiscal sustainability’ of mini-budget, says IFS
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Tory donor criticises tax U-turn, saying it’s wrong being governed by media reaction ‘which is not necessarily rational’
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UK government bonds strengthen after tax U-turn
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Kwarteng claims he feels ‘humility and contrition’ over 45% top rate of tax U-turn
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Kwarteng rules out giving departments £18bn needed to compensate for higher than expected inflation
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Kwarteng dismisses suggestion that Truss was blaming him for 45p plan in her BBC interview yesterday
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Labour says the U-turn is too late, because the mini-budget is already leading to higher mortgates
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Kwarteng says it was mistake attending champagne reception for Tory donors on day of mini-budget
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Kwarteng rejects claims that it was plan to abolish 45% rate that triggered need for £65bn Bank of England intervention
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Kwarteng suggests Truss took decision to perform U-turn
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‘Not at all’ – Kwarteng says he has not considered resigning over 45% top rate tax policy
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Kwarteng tells BBC Breakfast that 45p plan a ‘distraction’ from ‘good set of policies’
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Kwarteng confirms U-turn on abolition of 45% top rate of tax, saying plan was ‘distraction’ and ‘we get it’
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How Liz Truss said she was absolutely committed to abolishing 45% top rate of tax yesterday
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Truss expected to abandon plan to abolish 45% top rate of income tax
Filters BETA
Sally Weale
Education minister Andrea Jenkyns has been mocked on social media after she told a fringe event at the Conservative party conference that the current education system would rather young people get a degree in “Harry Potter studies” than in construction.
Jenkyns, minister for skills, further and higher education, told her audience that students were being fed a diet of “critical race theory, anti-British history and sociological Marxism” in universities, and she promised a government clear out of low quality courses.
Jenkyns, who was memorably photographed sticking up her middle finger at protestors after Boris Johnson’s resignation speech, told the Bruges Group event: “A skilled modern economy competing on the global stage requires technical skills just as much as it needs graduates.
“Yet the current system would rather our young people get a degree in Harry Potter studies than the apprenticeships shaping construction. It doesn’t take magic powers to work out that this is wrong, which is why the government is committed to putting the broomstick to good use and carrying out a spring clean of low quality courses.”
Sam Freedman, former senior policy adviser at the Department for Education, responded on Twitter: “Number of students currently studying architecture, building, planning and engineering = 245,395. Number currently studying ‘Harry Potter Studies’ = 0.”
Number of students currently studying architecture, building, planning and engineering = 245,395
Number currently studying “Harry Potter Studies” = 0 https://t.co/1fYA5XL5zN
— Sam Freedman (@Samfr) October 3, 2022
Badenoch urges Tories to unite behind Truss, and to express concerns in private, not through media

Andrew Sparrow
Kemi Badenoch, the new international trade secretary, got a tremendous round of applause when she arrived for her session on stage. Some surveys suggested that, if she had been on the final ballot, she would have won the Tory leadership. She was taking part in a Q&A, rather than delivering a speech, and she used it to appeal for unity. She also urged MPs with concerns about policy to express them in private, not through the media. She said:
As a party, we need to get behind the prime minister because if you don’t do that, then none of that …
We need unity. And we need to be able to have dissent in a grown-up fashion. I think, when other people have problems with policy, I think there is a way of communicating it and not necessarily rushing to the first TV studio to let everybody know how angry you are.
Some of the people who have done this are my friends, but it is not helpful for the whole party. So, the party needs to come together. But we also need to remember who our real opponents are and that’s the Labour party.

That’s all from me for today. My colleague Nadeem Badshah is taking over now.
Ranil Jayawardena, the new environment secretary, used his speech to the party conference to say that, under Liz Truss, the Department for Environment, Food and Rural Affairs would stop being a “regulatory department” and become an economic growth department. He said:
I can assure you all today that my department should no longer be seen as one that follows the EU, imposes rules and impedes innovation.
Instead of being a regulatory department, we are now an economic growth department.
Food and drink is our largest manufacturing sector.
It is bigger than automotive and aerospace put together, with a presence in every constituency in this country.
The opportunity for growth in the sector is enormous – and it will bring jobs, skills and prosperity across the nation.

Michelle Donelan, the culture secretary, used her speech to the conference to confirm that the online safety bill – temporary shelved after Liz Truss became PM – will return to the Commons. She said:
Last week there was the inquest into Molly Russell. It further highlighted the horrific failure of social media companies in terms of their ability to put children and young people, and their welfare, first.
I think we owe it to Molly Russell and all of Molly’s family to ensure that we do everything in our power to stop this from happening again.
Our online safety bill must be the answer and I will make sure the bill’s key objective really is ensuring that social media companies protect children online.
I can confirm here today that the bill will be returning to parliament and my dedicated team of ministers and I are working flat out to ensure that the bill is delivered.

Rachel Reeves, the shadow chancellor, says Kwasi Kwarteng’s speech shows he is “completely out of touch”. In a statement she says:
This speech showed us a chancellor and a Tory government completely out of touch, with no understanding on its own appalling record on growth.
What the chancellor called a little financial disturbance is a huge economic body-blow to working people that will mean higher prices and soaring mortgages. That’s the Tory economic premium.
This is an economic crisis made in Downing Street, paid for by working people.
Lockdown at Tory conference lifted after security alert lasting around 90 minutes

Rajeev Syal
The Conservative party conference centre was locked down for about an hour and a half due to a security scare.
Police locked all entrances and exits at about 3.30pm with ministers among those forced to wait outside. The lockdown caused widespread disruption to events inside and outside the conference venue, which is being held at Birmingham’s International Convention Centre.
The type of the security scare is unknown.
West Midlands Police tweeted this to alert people.
Due to a potential security alert we have temporarily restricted access to and from the ICC. Further updates to follow #CPC22
— Birmingham Police (@BrumPolice) October 3, 2022
And just after 5pm the police said the lockdown had been lifted.
Security restrictions at the ICC @thenecgroup have been lifted following a potential security alert. Delegates and visitors are now able to leave the centre #CPC22 We would like to thank everyone for their patience.
— Birmingham Police (@BrumPolice) October 3, 2022
While it is routine at party conferences for police to temporarily restrict access for security reasons, it is unusual for a lockdown to be imposed for more than half an hour.
Conservative ministers have become increasingly exasperated by the policing of the event. Police have allowed noisy protestors to continue to approach delegates as they enter the complex.
Kwarteng’s speech – verdict from Twitter commentariat

Ben Quinn
While much of the response inside the hall where Kwasi Kwarteng was delivering his speech appeared muted – with one of the loudest cheers reserved for repealing EU laws – media commentators were left underwhelmed by one of the shortest conference speeches delivered by a chancellor in modern times.
My colleague Rafael Behr says Kwarteng should have kept the speech to under five minutes.
The glaring problem with this speech is its presumption that no-one – not even Boris Johnson’s government – had ever thought of growing the economy before.
— Rafael Behr (@rafaelbehr) October 3, 2022
It’s also *very* repetitive. Cut some of the multiple references to inherited tax burden, Putin, Covid legacy, how important growth is, and you could easily get it down to <5 mins
— Rafael Behr (@rafaelbehr) October 3, 2022
He delivered that like it was a panel event on the fringe. All that was missing was the preamble where he says he’s very sorry but he’ll have to dash off a bit early to get to his next session.
— Rafael Behr (@rafaelbehr) October 3, 2022
James Forsyth from the Spectator says not announcing new policy was sensible.
No announcements in Kwasi Kwarteng speech. But given any would have been drowned out by the drama of the u turn, think that was sensible. It was a speech to get through for him
— James Forsyth (@JGForsyth) October 3, 2022
George Eaton from the New Statesman says the speech was empty.
Remarkable how little there was in Kwarteng’s speech on productivity and infrastructure spending given the UK’s biggest economic problems (not higher taxes).
— George Eaton (@georgeeaton) October 3, 2022
Tom Newton Dunn from Talk TV says he does not think the speech will impress Tories.
Well that was a sweaty 20 minutes?. Apart from a couple of vague early nods to his 45p U-turn, zero contrition and zero further announcements from Kwasi Kwarteng on fiscal discipline. Instead, we press on. Unconvinced that will persuade round the legion of Tory sceptics #CPC2022
— Tom Newton Dunn (@tnewtondunn) October 3, 2022
Hatty Collier from the i says Kwarteng was using understatement.
A mortgage broker reacts to Kwasi Kwarteng’s speech, telling @theipaper: “Calling the markets ‘a little turbulent’ is like saying that the Mount Vesuvius eruption was a small bonfire.”https://t.co/jtGnpD2aaT
— Hatty Collier (@HattyCollier) October 3, 2022
Freddie Hayward from the New Statesman says the speech was contradictory.
Kwarteng:
“We reversed that story of national decline,” after 12 yrs of Tory rule.
“The path ahead of us was one of slow managed decline,” after 12 years of Tory rule.
Which is it?
— Freddie Hayward (@freddiejh8) October 3, 2022
My colleague Jessica Elgot makes the same point.
Struggling to understand the logic of Kwarteng saying the Tory governments reversed years of decline under Labour but then saying the path they were on prior to his Budget was a path of national decline. Who is doing the declining?
— Jessica Elgot (@jessicaelgot) October 3, 2022
Kevin Schofield from Huffpost UK points out what’s missing.
Pretty amazing that Kwasi Kwarteng managed to avoid the words “inflation”, “interest rates” and “mortgages” in that Tory conference speech. Can’t think why.
— Kevin Schofield (@KevinASchofield) October 3, 2022
My colleague John Crace says it was vacuous.
For a supposedly clever person, Kwarteng just delivered the most intellectually vacuous and incoherent speech.
It sounded like a suicide note— John Crace (@JohnJCrace) October 3, 2022
Duncan Weldon, the economist and former BBC journalist, decided that the speech’s narrative was a confused one.
Rhetorically that was quite a strange speech. Opening was all about how things had been going wrong – high taxes, weak growth – and the budget was a new beginning & a change for the better.
Ending was about how Conservative govt had ended national decline under Labour.— Duncan Weldon (@DuncanWeldon) October 3, 2022
The broadcaster Sangita Myska says most of the speech sounded like rehash.
Kwarteng: talks about protecting the poor, securing public services and says Conservative values include low taxes for business. Rest of the speech was pretty much a restatement of the Fiscal Event
— Sangita Myska (@SangitaMyska) October 3, 2022
Sam Coates, deputy political editor at Sky News, picks up on how the chancellor’s words were an implicit criticism of Boris Johnson and Rishi Sunak, the former chancellor.
Forget a consensual approach, Kwasi Kwarteng goes in two footed. Says Britain was facing “slow managed decline” (hello Boris! hello Rishi”
And mentions twice 70 year tax burden – again implicit Sunak criticism – at a time when Truss gvt ought to be reaching out to his supporters
— Sam Coates Sky (@SamCoatesSky) October 3, 2022
My colleague Gaby Hinsliff says Kwarteng mostly ignored the problems with the mini-budget.
Extraordinary really to promise ‘fiscal discipline’ with a straight face after what we’ve just seen. Apart from the odd jokey reference, that speech essentially ignored everything that’s just happened, as if it was someone else’s budget entirely
— gabyhinsliff (@gabyhinsliff) October 3, 2022
Kevin Maguire of the Daily Mirror was particularly scathing.
That was a brief, empty, unremarkable, muted and formulaic speech from Kwasi Kwarteng.
The Chancellor’s speech is usually the second most important after the PM’s.
Begods.
— Kevin Maguire (@Kevin_Maguire) October 3, 2022
And Christopher Hope had picked up on the initial reaction in the room as Kwarteng arrived.
Liz Truss enters for Kwasi Kwarteng’s big conference speech. Half-hearted applause. Some stand, others don’t. Huge moment now for the Chancellor to sell his U-turn on the 45p tax rate. #CPC22
— Christopher Hope? (@christopherhope) October 3, 2022
New polling from Savanta ComRes suggests Labour has a 25-point lead over the Conservatives
?NEW Westminster Voting Intention?
?25pt LABOUR LEAD
?Lab 50 (+7)
?Con 25 (-4)
?LD 11 (-1)
?️SNP 3 (-2)
?Gre 3 (-1)
⬜️Other 8 (=)2,113 UK adults, 30 Sept – 2 Oct
(chg from 23-25 Sept) pic.twitter.com/etDSvhEV1n
— Savanta ComRes (@SavantaComRes) October 3, 2022
Kwasi Kwarteng’s speech – snap verdict
It is hard to think of a precedent for a chancellor delivering a party conference speech with absolutely no announcement of any kind in it. That speech was a news desert, devoid of anything new in terms of policy – or even language that move the argument into new terrain. I’m guessing, but I suspect perhaps there was an announcement pencilled in – that Liz Truss has pilfered it for her own speech on Wednesday. That would, at least, be logical; collectively they may have decided that there was no point wasting an announcement today, when the news cycle is dominated by the U-turn. The alternative – that Kwarteng just turned up with nothing to say – seems less likely.
Instead, all we got was a summary of the economic approach set out by Liz Truss during the Tory leadership campaign, and by Kwarteng in his mini-budget statement. But Kwarteng did not make it sound any more credible today than it has done in the past. He claimed the Conservative party had reversed “the story of national decline” when it came into office in 2010 – while at the same time explaining how the Truss government was having to reverse misakes made by the Tories over the past 12 years.
If the content was feeble, the delivery was even worse. Kwarteng sounded nervous, and he was rushing through it as if he could not wait to be off. He did not even seem to have worked out where the applause lines were meant to come.
Earlier I said the challenge facing Kwarteng with this speech was to show that he still has authority as a chancellor. (See 3.05pm.) It didn’t. If anything, it will have made his plight even worse.

Kwarteng has now finished.
He is getting a standing ovation – more out of sympathy, perhaps, than approval.
I will post a snap verdict shortly. But if you can’t wait, the word “dire” will do for now.
Kwarteng says: “Rather than bashing business, we are backing it.”
That is why the tax system needs to be simpler.
The government will reverse the planned increase in corporation tax, he says.
The reforms to IR35 will be reversed. They added unnecessary complexity for businesses.
He says the Tories have stood up for working people. They have delivered the lowest unemployment since the 1970s.
These are great achievements, Conservative achievements.
When the Tories came in, they were met with the full force of Labour’s economic incompetence. They reversed that national decline, he says.
Labour believes you can tax your way to growth. He says his party believes in low taxes: “We are Conservatives.”
Kwarteng says the government will deregulate in a series of areas: childcare, agriculture, immigration, planning, energy, business and financial services.
And he says the government will introduce reforms to stop strike action derailing reform.
Kwarteng pledges to review, replace or repeal retained EU law ‘holding our country back’
Kwarteng says the UK will review, replace or repeal retained EU law “holding our country back”.
Kwarteng says as business secretary he saw the role business played. He also saw how government could get in the way. Now he wants to free business from regulation.
He says the government will cut regulations in investment zones.
Today they face new challenges, Kwarteng says. He says he will act in a fiscally sustainable and responsible way.
The fiscal plan will set out how debt will fall as a percentage of GDP over the medium term, he says.
He says the Tories are “serious custodians of the public purse”. This is what separates the Tories from Labour.
Kwarteng says the UK went into the Covid crisis in a much stronger position than other countries, because of actions taken by the Conservative government in advance.
The UK has the second lowest debt in the G7, he says.
Kwarteng says this was a substantial intervention.
The price of not acting would have been higher than the price of the scheme.
As well as helping people now, the government will address the energy supply problem, so the UK can never be blackmailed again.
Kwarteng says the whole of Europe is facing a problem caused by the invasion of Ukraine.
Business groups feared mass unemployment. This was a very real prospect for the country.
So, within days of taking office, they produced one of the most significant interventions by the government ever.
He says the government’s energy plan will last two years – not just six months, like Labour’s.















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