A report today from the Institute for Fiscal Studies highlights just how dire the situation is. He says the government will need to find £60bn of savings by 2026 to plug the gap left by unfunded tax cuts in the mini-budget. My colleague Phillip Inman has the story here. This morning Thérèse Coffey is giving interviews. As well as health secretary and deputy prime minister, he appears to have been appointed ‘today minister’ (No 10’s first choice for a show when someone who sounds calm and sensible is needed – previous holders of the post include Grant Shapps and Michael Fallon). On Sky News he was asked about the IFS report and answered as if it were a moderately interesting academic exercise. Crucially, however, at no point did he try to suggest that what the IFS was saying was wrong. When Kay Burley asked about the IFS’ claim that there is a £60bn black hole in the government’s accounts, Coffey replied: IFS apparently does its own modeling. The government is working with the Bank of England and the OBR on these measures and this is what the Treasury is working on… But I think the IFS also pointed out, if we don’t grow, then this problem is going to get worse and worse. And for that, very clearly, the prime minister and the chancellor tabled a development plan. Asked again how the government would fill this “black hole”, Coffey again said it was an IFS model. Asked if it was correct, she replied: It’s not for me to say. These are their predictions. The chancellor will speak at the end of the month about the medium-term budget plan. Burley tried again. He said the IFS said all government departments, apart from the NHS and defence, might have to face budget cuts of 15% to cover this “black hole”. Coffey replied: I won’t get into hypotheticals, Kay. The chancellor is working on it… Later we will hear from Chancellor Kwasi Kwarteng himself about this. Submits questions to the Commons. Here is the agenda for the day. 8.45am: Liz Truss chairs a meeting of the political cabinet, followed by a regular cabinet meeting. 10.30am: The highest court begins hearing the case brought by the Scottish government arguing it has the right to hold an independence referendum. 11.30am: Downing Street briefs lobby. 13:00: Truss attends a virtual G7 summit, which will also be addressed by Ukrainian President Volodymyr Zelensky. 2.30pm: Kwasi Kwarteng, the chancellor, takes questions in the Commons. After 3pm: Peers start debating the second reading of the Northern Ireland Protocol Bill. After 3.45pm: MPs start debating the Health and Social Care Levy (Repeal) Bill. 4pm: Lord Frost, the former Tory Brexit minister, and Lord Mandelson, the former Northern Ireland Labor secretary and former trade secretary, give evidence to the Lords European Affairs Committee on Brexit. I’m trying to follow the comments below the line (BTL) but it’s impossible to read them all. If you have a direct question, include “Andrew” somewhere and I’m more likely to find it. I try to answer questions and if they’re of general interest I’ll post the question and answer above the line (ATL), though I can’t promise I’ll do it for everyone. If you want to get my attention quickly, it’s probably best to use Twitter. I’m on @AndrewSparrow. Alternatively you can email me at [email protected] Updated at 09.22 BST Important events BETA filters Key Events (2) The number of working-age adults in Britain who are not in the workforce because they are long-term ill has risen to a record high, official figures show. My colleague Richard Partington has the story here. Wendy Morton, the chief whip, arrives at Downing Street for this morning’s cabinet meeting. Photo: Isabel Infantes/AFP/Getty Images
Bank of England expands bond buying to avoid ‘fire sale’
The IFS report is not the only fresh blow to the credibility of the mini-budget this morning. As my colleague Richard Partington reports, the Bank of England stepped in with another emergency market intervention in an attempt to prevent a “fire sale” of UK government bonds by pension funds. My colleague Graeme Wearden has further coverage on his professional live blog.
Deputy Prime Minister Thérèse Coffey refuses to dispute the IFS report saying £60bn of spending cuts are needed to offset the micro-budget
Good morning. MPs return to the Commons after the party’s conference season today and, although Liz Truss has staged a potentially major comeback after the most disastrous first month in office of any prime minister in modern times, her problems still look almost insurmountable. A report today from the Institute for Fiscal Studies highlights just how dire the situation is. He says the government will need to find £60bn of savings by 2026 to plug the gap left by unfunded tax cuts in the mini-budget. My colleague Phillip Inman has the story here. This morning Thérèse Coffey is giving interviews. As well as health secretary and deputy prime minister, he appears to have been appointed ‘today minister’ (No 10’s first choice for a show when someone who sounds calm and sensible is needed – previous holders of the post include Grant Shapps and Michael Fallon). On Sky News he was asked about the IFS report and answered as if it were a moderately interesting academic exercise. Crucially, however, at no point did he try to suggest that what the IFS was saying was wrong. When Kay Burley asked about the IFS’ claim that there is a £60bn black hole in the government’s accounts, Coffey replied: IFS apparently does its own modeling. The government is working with the Bank of England and the OBR on these measures and this is what the Treasury is working on… But I think the IFS also pointed out, if we don’t grow, then this problem is going to get worse and worse. And for that, very clearly, the prime minister and the chancellor tabled a development plan. Asked again how the government would fill this “black hole”, Coffey again said it was an IFS model. Asked if it was correct, she replied: It’s not for me to say. These are their predictions. The chancellor will speak at the end of the month about the medium-term budget plan. Burley tried again. He said the IFS said all government departments, apart from the NHS and defence, might have to face budget cuts of 15% to cover this “black hole”. Coffey replied: I won’t get into hypotheticals, Kay. The chancellor is working on it… Later we will hear from Chancellor Kwasi Kwarteng himself about this. Submits questions to the Commons. Here is the agenda for the day. 8.45am: Liz Truss chairs a meeting of the political cabinet, followed by a regular cabinet meeting. 10.30am: The highest court begins hearing the case brought by the Scottish government arguing it has the right to hold an independence referendum. 11.30am: Downing Street briefs lobby. 13:00: Truss attends a virtual G7 summit, which will also be addressed by Ukrainian President Volodymyr Zelensky. 2.30pm: Kwasi Kwarteng, the chancellor, takes questions in the Commons. After 3pm: Peers start debating the second reading of the Northern Ireland Protocol Bill. After 3.45pm: MPs start debating the Health and Social Care Levy (Repeal) Bill. 4pm: Lord Frost, the former Tory Brexit minister, and Lord Mandelson, the former Northern Ireland Labor secretary and former trade secretary, give evidence to the Lords European Affairs Committee on Brexit. I’m trying to follow the comments below the line (BTL) but it’s impossible to read them all. If you have a direct question, include “Andrew” somewhere and I’m more likely to find it. I try to answer questions and if they’re of general interest I’ll post the question and answer above the line (ATL), though I can’t promise I’ll do it for everyone. If you want to get my attention quickly, it’s probably best to use Twitter. I’m on @AndrewSparrow. Alternatively you can email me at [email protected] Updated at 09.22 BST
