Chancellor calls for Tory unity over economic plan

We're going to pause our live coverage shortly. But first let's take a look at what's happened today.

• This morning, Prime Minister Liz Truss defended last week's much-criticised mini-budget in a series of BBC local radio interviews. She said the energy package and the tax-cutting measures announced would tackle high bills, reduce inflation by 5% and lead to long-term economic growth. Five key exchanges from those interviews are here.

• During an event in Darlington this afternoon, Chancellor Kwasi Kwarteng said the government will stick to its plan, stressing it would also help people with their energy bills. He also messaged fellow Tory MPs to call for their support

• When asked if further intervention by the Bank of England would be necessary, the Bank's current governor, Andrew Bailey, said he could not answer. While former governor, Mark Carney said the government's tax-cutting measures were "working at some cross-purposes" with the Bank
• A YouGov poll for the Times indicates the week of turmoil has led to Labour having a 33-point lead over the Conservatives. Other polls out today give Labour a 21 and 17-point lead.

Prime Minister Liz Truss carried out a flurry of BBC local radio interviews this morning, in an attempt to defend last week's mini-budget.

She faced tough questioning from the broadcasters including Radio Leeds' Rima Ahmed, who asked the PM: "Where have you been?"

During the Conservative leadership campaign, Liz Truss called Scotland's first minister Nicola Sturgeon an attention seeker, best ignored - at least on demands for an independence referendum.

But today, in much more conciliatory tones, Truss said she is “keen to work with” Sturgeon, and urged Sturgeon to follow her lead with tax cuts that could "turbo-charge" Scotland's economy.

Sturgeon responded on Twitter:

The Treasury Select Committee, chaired by senior Tory Mel Stride, has called on Chancellor Kwasi Kwarteng to publish the Office for Budget Responsibility (OBR) forecast as soon as possible, and well before the scheduled date of 23 November.

Stride says the failure to publish the forecast has led to the "unfortunate impression that the government may be seeking to avoid scrutiny".

Stride points out that the OBR said a forecast would be available by the time the mini-budget came around: "The OBR was standing by ready to provide a meaningful forecast alongside the [mini-budget] had the Treasury requested it. No such request was received," he adds.

The letter also says recent market turmoil was almost certainly worsened by Kwarteng’s failure to provide an OBR assessment of the impact of the chancellor’s tax cuts and massive fiscal stimulus.

The polls have moved sharply in favour of Labour, and away from the Conservatives, since last week’s mini-budget.

There have now been seven polls published with fieldwork dates starting on or after 23 September, several of them this afternoon and evening.

These are the results. It’s fair to say Labour hasn’t been this strong in the polls since 2001.

Three polls published this evening show:

• YouGov: Labour 33pt lead
• Survation: Labour 21pt lead
• Redfield & Wilton: Labour 17pt lead

Liz Truss faced questions about the fallout from her government's mini-budget and what it means to voters around the UK.

The prime minister was talking to BBC teams from the nations and English regions ahead of her party conference next week.

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The Bank of England's chief economist has contradicted government claims that the UK's economic issues are part of an international crisis.

Speaking at a conference in Northern Ireland, Huw Pill said the fall in the value of the pound and surging borrowing costs was partly a result of the government's economic strategy.

"Over the course of the past week, there has be a significant re-pricing of financial assets. Part of that re-pricing reflects broader global developments," Pill said. "But there is undoubtedly a UK-specific component."

He also warned the government's plan to cut taxes and increase borrowing will require the Bank of England to adopt a "significant monetary policy response" - likely signalling a fresh interest rate rise.

Earlier, Prime Minister Liz Truss told the BBC that a "global crisis" had sparked the collapse in the pound's value.

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Some reaction from the Labour Party now and shadow chancellor Rachel Reeves says parliament should be recalled and the tax cuts that were announced in last week's mini-budget reversed.

She disagrees with Prime Minister Liz Truss' insistence that the volatility is a global issue, stating: "This is a crisis made in Downing Street".

She went on: "This is about what the chancellor did last week in his so called mini-budget.

"The prime minister and the chancellor must now recall parliament and reverse their budget decisions – without that the markets and ordinary families and pensioners are going to be paying a big price."

She said what we've heard today from Truss and Kwasi Kwarteng had done little to reassure either the markets or ordinary families.

Reeves added that while everyone agrees a package of support to help people with their energy bills is essential, it should be funded though through an extension of the windfall tax "so the big energy giants pay their fair share".

"These are incredibly worrying times," she says: "And all for what? To cut taxes for the very wealthiest in society. Who pays the price for that? Ordinary families up and down the country."

After a week of turmoil following the government's tax-cutting mini-budget, Labour has taken a 33-point lead over the Conservatives, according to a YouGov poll for the Times.

Poll voters have pretty much rejected Kwasi Kwarteng's proposals, with only 10% seeing the package as fair - which is down from 19% on Monday.

Just 37% of 2019 Tory voters said they would stick with the party if a general election was held now, the poll showed.

It is not a good result for Liz Truss either - with almost three times as many voters saying Labour leader Sir Keir Starmer would make the best prime minister.

Also, asked whether Truss's leadership rival Rishi Sunak would have made a better or worse party leader - 44% said better and 13% said worse.

In his message to fellow Tory MPs, the chancellor is seeking to reassure them that he is working quickly to come up with a plan to calm the markets, and in the face of mounting criticism from his backbenchers, he is also urging them to stay united.

On 23 November he is due to set out what he calls a medium term fiscal plan, that he argues will show how he intends to get debt falling. But he has been coming under pressure from Conservative MPs to act more quickly.

He tells MPs the government is working 'at pace' to show the markets there is a ''clear plan'' and to show that it is ''sound, credible and will drive growth''.

There is scepticism amongst MPs that the economic growth needed to pay for the announced tax cuts and the government's energy bills intervention can be generated quickly enough.

That's why in this note he says there are lots of ''ambitious'' supply side reforms coming over the next 6 weeks, such as reform to childcare, business regulations, financial services and agriculture.

The chancellor might be conciliatory in tone, saying he always values colleagues' time and ideas and he is ''always available for a meeting''. But there is no hint here that he is prepared to backtrack on any aspect of his economic plan.

Conservative MPs have been sent a list of "talking points" to defend the government's handling of the economy, the Financial Times's Sebastian Payne tweets.

The list of defences - sent out by Downing Street staffers and Tory HQ - reportedly include the need to emphasise that the economy was already in decline and that the "government needed to act urgently".

The document also insists that the government has taken a "responsible and realistic approach to managing public finances" and argues that the UK is not the only country currently experiencing currency fluctuations.

It also says that the measures set out by the chancellor last week are the kind demanded by international central banks.

But MPs aren't told which central banks have advocated such measures - and the leak of the document follows criticism of Kwarteng's mini-budget from the International Monetary Fund (IMF).

Earlier, we told you that the chancellor had messaged his fellow Tory MPs, calling for their support.

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A little more now on Kwasi Kwarteng's note to fellow Conservative MPs as he attempts to shore up support for the government's economic plans.

Kwarteng insists the government is ''working at pace'' to prove to investors and the markets that it has a "clear plan" to get the economy growing - and tells his colleagues the UK needed a new economic outlook.

"The path we were on was unsustainable - we couldn’t simply continue to raise taxes," Kwarteng writes.

He goes on to defend his record in office so far, telling Tory MPs that the government's decision to cap energy prices was necessary to prevent a collapse in consumer spending.

He concludes by telling peers that he and the prime minster "need your support" - and that he has ''always valued colleagues' time and ideas''.

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Liz Truss has continued to defend her plan for debt-fuelled tax cuts in a further series of interviews with local BBC reporters this afternoon.

She's switched medium from radio to television, but the message is the same - the prime minister again defended her economic strategy, despite days of market turmoil.

As she did this morning, she continued to argue record falls in the pound and surging UK borrowing costs were part of a "global crisis" sparked by the war in Ukraine.

She added that the government was working "very closely" with the Bank of England - which has started buying £65bn of government debt in an attempt to calm markets.

Chancellor Kwasi Kwarteng defends his mini-budget measures, saying they are "absolutely essential" in "delivering much better growth outcomes for people".

"We're absolutely protecting people right across this country," he says, adding that because of the government's intervention, "we've limited the average household bill".

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We have a couple more lines to bring you from Kwasi Kwarteng's comments in Darlington a short while ago.

The chancellor says it's "premature to come to a decision" on whether he will stick to a longstanding policy to increase benefits in line with the current rate of inflation in April.

Inflation has been soaring amid the UK's current economic crisis - and currently stands at nearly 10%.

Kwarteng insists that the government is committed to "helping people in the round", which he says means protecting "the most vulnerable in our society" through the winter.

Asked specifically about the pensions triple lock, he says "the government is committed to maintaining it".

Under the triple lock formula, state pensions increase each year by inflation, or the increase in earnings between May and July, or 2.5% - whichever of the three rates is the highest.

However, Boris Johnson's government did not take increased earnings into account this year because the numbers were skewed by the Covid pandemic.

More comments now from Chancellor Kwasi Kwarteng - who's been asked about the fallout from his mini-budget while on a visit to Darlington, County Durham.

He continues to stick by his announcements - saying the government is "very focused on making sure cost-of-living pressures can be withstood by people up and down this country".

Kwarteng continues with his defence of last Friday's measures after a question about rising mortgage rates.

The government is "protecting people right across this country," he insists - pointing to an intervention in the energy market which will lead to "huge savings" for people on "normal incomes".

He adds that he's focused on delivering "the growth plan" - saying without growth, the government can't generate income to pay for public services.

Sky News political editor Beth Rigby has tweeted screengrabs of a message purporting to be from Kwasi Kwarteng to fellow Tory MPs - in which the chancellor tells his colleagues: "We need your support."

In the message, Kwarteng says he understands the concerns of his peers, but asks for the party to "remain focused" and stick together as a team.

There follows a justification of his tax-cutting and borrowing plans - spelt out last Friday and scrutinised at length for the past several days - in order to keep the cost of living low for the British public.

According to the leaked message, Kwarteng insists "we will show markets our plan is sound".

He continues: "The only people who will win if we divide is the Labour Party."

Kwarteng then tells fellow MPs he values their input and is "always available for a meeting".

There was no immediate response from Kwasi Kwarteng's team to the leaked message.

The Office for Budget Responsibility (OBR), the independent fiscal watchdog, said it has been asked by Chancellor Kwasi Kwarteng to produce a first draft of its economic forecasts by 7 October.

The lack of an OBR report to accompany Mr Kwarteng's mini-budget last Friday deeply rattled financial markets.

The BBC revealed last week that the Treasury refused to publish an OBR report which would show the impact that the chancellor's massive tax and borrowing package would have on the UK economy and its finances.

A final report by the OBR is expected to be released on 23 November when Mr Kwarteng reveals his medium-term fiscal plan.

This should set out how the government intends to follow its own fiscal rules. The current fiscal rules state that debt should be falling as a share of the UK's gross domestic product - which is all the goods and services that the country produces - by 2024-25.

The rules also dictate that by that same financial year, daily public spending should be balanced by revenues.

But it is possible that Mr Kwarteng could set out his own rules, changing those drawn up by his predecessor Rishi Sunak in November 2021.