The pound rallied to a nearly two-week high today after Liz Truss and Chancellor Kwasi Kwarteng made a U-turn on key parts of their controversial tax cut plan. Sterling rose to $1.1343, bouncing around 10% from a record low against the dollar last week, as plans for unfunded tax cuts unleashed chaos on British assets. Disturbance among Liz Truss’ own MPs at the Conservative Party Conference is unlikely to stop there, however, with Priti Patel the latest senior backer set to take shots at the leader over her budget plan. “We spend today without thinking about tomorrow, and like the Blob in the old horror movie, the more resources that are absorbed today, the bigger the problem becomes and the more resources it will need to eat tomorrow,” Ms Patel is quoted as saying. he said during a speech later today. The prime minister admitted she had not had an “easy” week in an op-ed for today’s Express newspaper, but said she was sticking to the rest of the tax cut package which she insisted was “essential to get the British economy moving”.
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Suella Braverman considers anonymity before suspect indictment to end ‘media circus’
Home Secretary Suella Braverman is considering a radical change to the criminal justice system to guarantee anonymity for suspects before charges are laid. The cabinet minister said she was “looking into” whether changes could be made to protect the privacy of those suspected of crime to save them from “trial by the media”. “I think we’ve had some high-profile cases where the media circus around a suspect – who has not been charged – can be and has been devastating,” he told the Tory party conference in Birmingham. My colleague Adam Forrest has more:
Suella Braverman discusses pre-indictment anonymity for suspects
Naming accused before charges can be ‘very damaging’, says Home Secretary Namita Singh4 October 2022 06:4 1664861810
The rich still earn 40 times more than the poor from the budget
Britain’s richest households are still set to get almost 40 times more in cash than the poorest from Kwasi Kwarteng’s budget, even after it switches to a 45p rate, according to a leading financial think tank. The richest 5 per cent of households will benefit by £3,500 each on average from decisions in the September 23 mini-budget, compared with £90 for the poorest fifth, the Resolution Foundation said. And unless he makes further reversals in the budget announcements, Mr Kwarteng will need to impose “significant spending cuts” in his medium-term budget plan on November 23 or miss his target of reducing government debt as a percentage of GDP. Our political editor Andrew Woodcock reports:
The rich still get 40 times more than the poor from the budget, even after Kwasi Kwarteng’s reversal
A quarter of all benefits from £43bn tax cut go to 1.5m wealthiest households Namita Singh4 October 2022 06:3 1664860546
Priti Patel takes a shot at Truss: “I spend today without thinking about tomorrow”
In a sign of continued concern among Tory MPs over the budget plan, Priti Patel is set to accuse Liz Truss and Quasi Kwarteng of “spending today without thinking about tomorrow”. “I want to see our party regain its credibility by restoring its commitment to sustainable public spending … that is affordable today, tomorrow and for the foreseeable future,” the former home secretary will say at a conference fringe event, according to the Times . The warning shots over the unfunded tax cuts come after the chancellor made two U-turns in one day amid growing backlash over his mini-budget. FILE: Britain’s Home Secretary Priti Patel reacts during a visit with members of Thames Valley Police at Milton Keynes Police Station in Milton Keynes on August 31, 2022 (POOL/AFP via Getty Images) Asking the prime minister to put a “cap” on public sector spending, Ms Patel will say: “We spend today without thinking about tomorrow, and like the Blob in the old horror movie, the more resources that are absorbed today, the bigger the the problem becomes the more resources he will need to eat tomorrow. “Right now, we’ve gone into a pattern of borrowing huge sums to fix today’s pressing problems or create short-term populist headlines. Every time there seems to be a good case, but what does that mean for future generations? “I want to see our party regain its credibility by restoring its commitment to sustainable public spending. . . that is accessible today, tomorrow and for the foreseeable future”. Namita SinghOctober 4, 2022 06:1 1664859534
Repeal of tax plan bounces stocks and sterling
Asian shares rallied today after Britain scrapped parts of a controversial tax cut plan, temporarily boosting global market sentiment and rallying bonds and the pound. In trade dampened by holidays in China and Hong Kong, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1 percent, led by a 2.5 percent rise in Australia. Japan’s Nikkei rose 2.6%. Sterling drifted to a near two-week high of $1.1343, a recovery of almost 10% now from last week’s record low, after plans for unfunded tax cuts unleashed chaos on British assets. A photo taken on April 22, 2022 shows pounds sterling coins and banknotes displayed on a table, in London (AFP via Getty Images) “The about-face … will not have a huge impact on the UK’s overall fiscal position in our view,” said John Briggs, head of finance and market strategy at NatWest Markets. “(But) investors took it as a signal that the UK government could and is at least partly willing to back away from the intentions that so unsettled markets last week.” Investors also accepted stability at the long-term end of the gold market, even though emergency purchases from the Bank of England were relatively modest. Namita Singh4 October 2022 05:5 1664858746
Truss admits not having an ‘easy’ week, vows to stick to tax cut package
Liz Truss admitted it had not been an “easy” week but said she was sticking to the rest of the tax cut package set out in the mini-Budget. He told the Express newspaper: “Express readers can rest assured: we will reward your trust. “It has not been an easy week, but we have shown that we are listening to people’s concerns and are determined to deliver on our core plan for financial success and security. “Our plan for growth is essential to get the UK economy moving. Growth is the only way to create jobs, raise wages and fund our vital public services like the NHS. British Prime Minister Liz Truss watches Chancellor Kwasi Kwarteng deliver a speech on the second day of the Conservative Party annual conference on October 3, 2022 in Birmingham, England (Getty Images) “With the Energy Price Guarantee, we support families and businesses with their energy bills. “With our tax cuts, we will put money back into the pockets of hard-working people and grow our economy. “With our investment plans, we will unlock the potential of the whole country and energize Britain. “This is the best country in the world and I will do whatever it takes to put us on the path to a safer, more prosperous future.” The prime minister is expected to deliver a short speech at the Conservative Party conference on Wednesday, which the newspaper described as “short, sharp, upbeat”. Namita SinghOctober 4, 2022 05:4 1664857949
The Tories seeking to shift focus from the economy after the humiliating turn
The Conservatives will try to shift the focus away from the economy after the humiliating of two swings on income tax cuts for the highest earners and the date of a new budget plan. Home Secretary Suella Braverman and Foreign Secretary James Cleverley will seek to set out the government’s immigration plans and commitment to support Ukraine in their keynote speeches today at the Tory conference in Birmingham. Ms Braverman will use her speech at the conference to call on the French to stop more boats crossing the Channel and set out her intention to introduce new laws to make it easier to deport people who come to the UK illegally. Home Secretary Suella Braverman sits in conversation at a fringe event for young Conservatives on day two of the Conservative Party Conference in Birmingham ICC on October 3, 2022 in Birmingham, England (Getty Images) The home secretary will promise to allow “the kind of immigration that grows the economy” but “end the abuse of the rules”. The Foreign Secretary will declare that Britain has the “strategic strength” to lead Ukraine to victory over Russian invaders. He will say Ukraine has the UK’s full support in its efforts to push back Vladimir Putin’s forces, saying “we are players on the pitch” and not just “commentators”. Mr Smart will also repeat Liz Truss’ vow that the UK will never accept Russian President Vladimir Putin’s annexation of Donetsk, Luhansk, Kherson, Zaporizhia or Crimea regions. Namita SinghOctober 4, 2022 05:3 1664852400
The Tories face ‘wiping out’ as new poll gives Labor a 25-point lead
Labor has a 25-point lead over the Conservatives in a new poll which suggests Liz Truss will be on track to be “wiped out” at the next general election. The Savanta ComRes survey is the latest to show a collapse in Tory support following Chancellor Kwasi Kwarteng’s disastrous mini-budget. The pollster said Labour’s lead was the largest ever recorded by the firm and could put the Tories out of power for a generation. You can read the full story here by Andrew Woodcock
Tories face electoral ‘elimination’ as new poll gives Labor 25-point lead
The Tories “could be out of power for a generation”, says pollster Savanta ComRes Lamiat Sabin4 October 2022 04:00 1664848800