Tory Party Conference 2022 - live: We could have 'laid ground better' for mini-Budget, Liz Truss says




  • In Business
  • 2022-10-02 08:56:15Z
  • By The Telegraph
Liz Truss, the Prime Minister, is pictured this morning during an appearance on the BBC
Liz Truss, the Prime Minister, is pictured this morning during an appearance on the BBC's Sunday with Laura Kuenssberg programme - Stefan Rousseau/PA  
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  • Join our Telegraph Politics WhatsApp group for latest news

Liz Truss has admitted for the first time that the Government could have done a better job of preparing the financial markets for the mini-Budget.

The Prime Minister told the BBC: "I do stand by the package we announced... but I do accept we should have laid the ground better.

"I do accept that and I have learnt from that and I will make sure that in future we do a better job of laying the ground."

Ms Truss made the comments as she fired the starting pistol on the Conservative Party's annual conference in Birmingham.

The Prime Minister is trying to stabilise her premiership after her mini-Budget of massive tax cuts and increased government borrowing sparked economic turmoil and a rebellion by some Tory MPs.

Michael Gove, the former Cabinet minister, said he remains "profoundly" concerned about the Government borrowing money to pay for tax cuts for the wealthiest as he argued it displayed "the wrong values" and it is "not Conservative".

​​Follow the latest updates below.

09:56 AM

Lib Dems tell Tory MPs to vote against mini-Budget

Sir Ed Davey, the leader of the Liberal Democrats, has told Tory MPs they must "do their patriotic duty" and vote against Liz Truss's mini-Budget when the House of Commons returns later this month.

He said: "The Prime Minister is completely delusional in ignoring the fear and anxiety her botched budget has caused millions of people.

"Liz Truss should have apologised to homeowners facing much higher mortgage bills and savers worried about their pensions, and dropped her dangerous ideas. Instead the Prime Minister's arrogantly doubled down, proving yet again just how out of touch the Conservatives are.

"Her failure to rule out public spending cuts means our treasured NHS could end up paying the price. Conservative MPs must for once do their patriotic duty and vote down the Prime Minister's unfunded tax cuts for big banks and billionaires."

09:54 AM

Tory former chief whip may vote against mini-Budget

Julian Smith, a Tory former chief whip has suggested he will vote against Kwasi Kwarteng's mini-Budget when Parliament returns - regardless of the consequences.

Jake Berry, the Tory chairman, said this morning that any Tory MP who votes against Mr Kwarteng's tax-cutting plans would lose the party whip.

But Mr Smith, the MP for Skipton and Ripon, responded to Mr Berry's comments by tweeting: "The first job of an MP is to act in the interest of their constituents and in the national interest.

"We cannot clap for carers one month and cut tax for millionaires months later."

09:50 AM

Labour accuses PM of 'mad experiment'

Rachel Reeves, the Labour shadow chancellor, said the idea that the Government's mini-Budget will lead to annual economic growth of 2.5 per cent is "for the birds".

She told the BBC: :The Prime Minister just doesn't seem to understand the anxiety and fear. This is a crisis made in Downing Street but it is ordinary working people who are paying the price.

"The idea that trickle-down economics is somehow going to deliver the 2.5 per cent growth we all want to see is for the birds.

"The Prime Minister and the Chancellor are doing some sort of mad experiment with the UK economy and trickle down economics. It has failed before and it will fail again."

09:48 AM

Tory chairman shrugs off Labour poll lead

Jake Berry, the chairman of the Conservative Party, has shrugged off significant Labour leads in recent opinion polls, arguing they would look "very different" closer to the general election.

Mr Berry said that "I know and believe that when we get to that general election and when we have delivered that growing economy, when we have ensured that the benefit is felt by every household in this country, that it will be a very different result than shown in that snap poll a few days after the Government has done a mini-fiscal event."

09:46 AM

'We have an absolute mandate'

One of the key questions being asked of Liz Truss is whether she has a mandate for her plans given that she has not won a general election.

Jake Berry, the chairman of the Conservative Party, argued this morning that the 2019 Tory election victory gave Ms Truss an "absolute mandate".

He told Sky News: "That 2019 manifesto set out two things. It set out that we wouldn't increase taxes and in fact we have complied with that by reversing the national insurance rise. It set out that we would drive to create economic growth and that's exactly what the Prime Minister's doing.

"We have an absolute mandate from that manifesto and we will continue to deliver."

09:44 AM

Tory chairman rejects criticism of tax cuts

The Conservative Party chairman said it was "nonsense" to claim that the Government's tax cuts are helping the richest the most.

Jake Berry told Sky's Sophy Ridge On Sunday programme it was "simply incorrect", adding: "Every single working person in this country is going to see a cut in their national insurance this month and we also know that the lower paid in this country, as a percentage of their income, pay more in national insurance than higher earners.

"So in fact as a percentage of income it is giving a bigger tax cut to those lower earners than it is to the top earners."

Shown a graph from the Resolution Foundation think tank suggesting higher earners benefitted most from the Government's plans, Mr Berry said he could not see the image.

He said: "I would go back and say what we are doing for every household in this country is ensuring that they get a cut in their tax bill next month when that pay slip drops through the letter box or arrives via email."

09:38 AM

'A drive to trim fat'

The chairman of the Conservative Party did not rule out spending cuts, but refused to be drawn on specific policies.

Speaking on Sky's Sophy Ridge On Sunday, Jake Berry said: "I don't think it's unreasonable to say that the public sector should look at its expenses in the same way that every single household is doing in this country.

"What we've heard from the Government is there's going to be a drive to trim fat in terms of Government expenditure."

Asked whether this would involve stopping benefits from being increased in line with inflation, Mr Berry said: "It's not for me to make fiscal announcements in relation to benefits."

09:35 AM

Labour U-turn on energy bills freeze

A Labour U-turn on energy bills.

Labour originally said its proposal for an energy bill freeze would last for six months. The party had not committed to the Government's two-year period of support, arguing it would reassess the situation next April.

But Rachel Reeves, the shadow chancellor, has now revealed the party has changed its mind.

She told the BBC's Sunday with Laura Kuenssberg programme that "we support that support for the two year period".

09:32 AM

Michael Gove hints he could vote against mini-Budget

Pressed on whether he would vote for the mini-Budget in the House of Commons, Michael Gove said: "I don't believe it's right."

Not a firm yes or no from the former Cabinet minister but definitely a hint that he could vote against the measures.

09:21 AM

Michael Gove savages mini-Budget

Michael Gove said he is "profoundly" concerned about the Government borrowing money to pay for tax cuts.

He said: "There are two things that are problematic. Two major things that were problematic with the fiscal event.

"The first is the sheer risk of using borrowed money to fund tax cuts. That is not Conservative. And then the second thing is the decision to cut the 45 pence rate and indeed at the same time to change the law which governs how bankers are paid in the City of London.

"Ultimately, at a time when people are suffering... when you have additional billions of pounds in play, to have as your principal decision the headline tax moved, cutting tax for the wealthiest, that is a display of the wrong values."

09:18 AM

'There is an inadequate realisation at the top of of government of the scale of change required'

Michael Gove has said the Government still does not realise that the mini-Budget has to be overhauled.

The former Cabinet minister told the BBC: "I think it was right for the Prime Minister to acknowledge that the events of Friday, that fiscal event, need to be revisited, there needs to be a recognition of mistakes but I think it is still the case that on the basis of what the Prime Minister said... that there is an inadequate realisation at the top of of government of the scale of change required.

"So yes, the energy package was the most important thing in the fiscal event but broadly 35 per cent of the additional money that we are borrowing is not to cut energy costs, it is for unfunded tax cuts."

09:12 AM

PM 'confident' mini-Budget will deliver economic growth

Liz Truss said she is "confident" her economic plan will deliver growth.

She told the BBC's Laura Kuenssberg: "I am not saying it is not going to be difficult, we do face a very turbulent and stormy time, but it will deliver on the promises we made."

Liz Truss appears on the Sunday with Laura Kuenssberg programme - Stefan Rousseau /PA
Liz Truss appears on the Sunday with Laura Kuenssberg programme - Stefan Rousseau /PA  

09:09 AM

'We have to look at the mortgage issue separately'

Liz Truss was asked if she accepted that the benefit from the energy bills support package could be wiped out for some people by increases in mortgage payments caused by rising interest rates.

She said: "I understand that people are worried and are struggling, it is a very difficult time. We have to look at the mortgage issue separately which is the Bank of England set interest rates, not the government."

Asked if she accepted that some people could be worse off, the PM said "we want to do all we can to help home owners" but "ultimately interest rates are a matter for the independent Bank of England".

09:05 AM

Government 'didn't have time' for OBR forecast

Liz Truss has defended pressing ahead with the mini-Budget without an accompanying economic forecast from the Office for Budget Responsibility.

The Prime Minister said that "there is a process that you need to go through" and "we simply didn't have time to go through that process".

09:03 AM

'I do not manage Kwasi's diary'

Kwasi Kwarteng is facing calls for an official inquiry following a report that he attended a private champagne reception with hedge fund managers following his mini-Budget.

Liz Truss was asked about the story and she told the BBC: "The Chancellor meets business people all the time... I do not manage Kwasi Kwarteng's diary."

09:00 AM

PM fully committed to 45p tax cut

Liz Truss has insisted that she is sticking with her pledge to cut the 45 top rate of income tax.

Asked if she intends to keep the tax cut, she told the BBC's Laura Kuenssberg: "Yes."

Ms Truss said the cut is part of "making our tax system simpler and lower". She also argued that the 45 rate actually "raises very little" in revenue.

Asked if she had discussed the 45p tax cut with her Cabinet, Ms Truss said: "No."

08:58 AM

Liz Truss refuses to guarantee benefits will rise in line with inflation

Liz Truss has refused to guarantee that benefits will rise in line inflation.

The Prime Minister said it is "something the department of work and pensions secretary is looking at at the moment, she will make a determination on that and we will announce that this autumn".

Asked again if she could guarantee benefits will rise in line with inflation, the PM said again that the Government is "looking at" the issue.

The PM said the Government is "committed to the triple lock" on pensions.

08:52 AM

PM refuses to be drawn on potential cuts to public spending

Liz Truss was asked if she is going to cut public spending.

The Prime Minister stressed the importance of economic growth and said "we need to grow the size of the pie".

Asked again if she intends to cut public spending, Ms Truss did not answer directly but said "I believe in getting value for money for the taxpayer".

Asked again if spending on public services could be cut, Ms Truss again said her focus is on securing "value for money for the taxpayer".

The Prime Minister said that the Government will "reduce debt as a proportion of GDP... in the medium term".

08:45 AM

Liz Truss admits she could have done a better job on mini-Budget unveiling

Liz Truss has admitted for the first time that the Government could have done a better job of preparing the financial markets for the mini-Budget.

She told the BBC: "I do stand by the package we announced... but I do accept we should have laid the ground better.

"I do accept that and I have learnt from that and I will make sure that in future we do a better job of laying the ground."

08:44 AM

'We do have a very clear plan'

Liz Truss was asked if she felt any responsibility for the anxiety people may feel about rising mortgages and rents.

The Prime Minister repeated her argument that the world is wrestling with rising interest rates and economic instability and that these are not just confined

She said that "this is a global problem". Ms Truss also insisted that "we do have a very clear plan" to help people.

Liz Truss, the Prime Minister, reacts as she speaks at a television studio on Sunday with Laura Kuenssberg - Hannah McKay/Reuters
Liz Truss, the Prime Minister, reacts as she speaks at a television studio on Sunday with Laura Kuenssberg - Hannah McKay/Reuters  

08:40 AM

Liz Truss defends mini-Budget plans

Liz Truss has defended her tax and borrowing plans as she said that it was "vitally important that we acted" to help struggling families.

The Prime Minister told the BBC that if the Government had not acted on energy bills then "we would be in serious trouble as a country".

"What we are preventing is those extraordinary bills that people were expecting," she said.

The Prime Minister said that the energy bill help represented the biggest part of the mini-Budget.

08:38 AM

'A number of mistakes were made'

Michael Gove, the Tory former Cabinet minister, is one of the guests on the BBC's Sunday with Laura Kuenssberg programme.

Mr Gove said that "we are in grim economic circumstances" and "people are looking to Liz and to Kwasi and they want reassurance".

Mr Gove said that people across the nation want to know that the Prime Minister and the Chancellor "share their values".

He said a "number of mistakes were made" in the mini-Budget but argued there is "room and time to address them and correct them".

08:25 AM

Labour demands Government publish OBR economic forecast

08:23 AM

Tory rebels plan two-pronged 'resistance'

The One Nation group of Conservative MPs is likely to be a focal point for rebellious Tory MPs seeking to water down the Government's mini-Budget, The Telegraph has been told.

Tory backbenchers unhappy with the fiscal statement said they were looking to build a two-pronged "resistance" campaign aimed at blocking the scrapping of the 45p additional income tax rate and any attempt to slash benefits.

The One Nation caucus is one of the most influential Tory parliamentary groups, representing a bloc of centrist MPs.

You can read the full story here.

08:18 AM

'I said I would do these things'

Liz Truss has defended the decisions she has taken since becoming Prime Minister, telling Tory rebels: "I said I would do these things."

The Prime Minister told The Sunday Telegraph: "Often, I think, people feel politicians talk, and they don't necessarily 'do'. I'm very focused on doing, and getting these changes happening in the British economy, enabling people to keep more of their own money, keeping bills low.

"I campaigned on this basis in the leadership election campaign, I said I would do these things. And I'm determined to follow through on things because I see that this is what will make Britain more successful."

Asked if she is planning to retain the entire mini-Budget package, including the most controversial proposal to scrap the 45p rate of income tax, the Prime Minister simply replied: "Yes."

08:09 AM

Liz Truss attempts to sooth Tory anger

A string of Conservative backbenchers have joined opposition parties in publicly criticising Liz Truss's mini-Budget tax and borrowing plans.

Perhaps the main point of criticism has been over the decision to scrap the 45p top rate of income tax.

Liz Truss, the Prime Minister, arrives at Tory conference in Birmingham yesterday - Tolga Akmen /Shutterstock
Liz Truss, the Prime Minister, arrives at Tory conference in Birmingham yesterday - Tolga Akmen /Shutterstock  

But the Prime Minister made clear in an interview with The Sunday Telegraph that she will not be reversing course as she argued that sticking with the "status quo isn't an option".

She said: "Change is always something that people might find worrying. But what I'm fundamentally saying is we do have to change, and the status quo isn't an option."

08:04 AM

PM: Only my growth plan will reverse Britain's managed decline

Liz Truss has declared that only her plan to transform Britain into a low tax, high growth economy will reverse the "current trajectory of managed decline".

In her first newspaper interview since becoming Prime Minister, Ms Truss told The Sunday Telegraph that "tough decisions" are needed to boost growth in order to increase wages, investment and employment.

She insisted that the public is more concerned with jobs and education than "what the polls were last year", warning that voters "feel that there has been a failure to address some of the fundamental issues that affect our country".

Unveiling new reforms to cut red tape for small businesses, the Prime Minister said that she wants to combat Britain's "lack of dynamism".

Seeking to quell discontent among Tory MPs over measures such as the abolition of the 45p tax rate, the Prime Minister said that she wants to "bring people with me on this journey".

You can read the full story here.

08:01 AM

Good morning

Good morning and welcome to today's politics live blog.

I am in Birmingham to bring you all of the latest updates from what is likely to be a box office Conservative Party conference.

Liz Truss will formally get proceedings underway this morning as she takes part in the traditional BBC leader interview.

There will then be a myriad of fringe events, as well as big speeches in the main conference hall, this afternoon.

I will guide you through the key moments.

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