Tory MPs plot to block Truss cuts after U-turn

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October 04, 2022 View in browser Hello there, I'm Thomas Kingsley and welcome to The Independent's Inside Politics newsletter.    The Conservative Party conference is into its third day but the only event on the mind of Tories is Liz Truss' latest U-turn and what could follow from the prime minister. Kwasi Kwarteng attempted to make light of the reversal admitting "a little turbulence" after his mini-Budget, but the joke hasn't been well received by those on the receiving end of the market mayhem caused.   Inside the bubble   Political commentator John Rentoul on what to look out for today:   Speakers from the main stage at the Conservative Party conference in Birmingham are Thérèse Coffey, deputy prime minister and health secretary, Suella Braverman, home secretary, and James Cleverly, foreign secretary, from 4pm.   Elsewhere, the UK Covid-19 inquiry chaired by Baroness Hallett is to hold its first preliminary hearing, starting at 10am.     Daily briefing Tory MPs plot against Truss   Centrist Conservative MPs have vowed to block Liz Truss's plans for reduced spending on public services and welfare, after a humiliating U-turn on tax left the prime minister's authority deeply damaged.   One former minister told The Independent that opponents of the PM's radical economic policies had been "invigorated" by the sight of Ms Truss "blinking" over a scheme to abolish the 45p top rate of tax for the highest earners. And senior backbenchers made clear that they were ready to do battle on welfare, with two former work and pensions secretaries saying it would be wrong to renege on Boris Johnson's pledge of an inflation-matching rise and Michael Gove indicating he would need "a lot of persuading" to back cuts.   A new survey put Tories a staggering 25 points behind Labour, in findings which pollsters Savanta said could deliver a three-figure majority for Sir Keir Starmer and near wipeout for the Conservatives, who could be left out of power for a generation.    Mr Kwarteng sparked fresh concern by warning that public services will have to stick to budgets agreed in last year's Comprehensive Spending Review, despite soaring inflation which has since eaten into their value.   The chancellor is understood to have brought forward a statement on his spending plans – along with the publication of the Office for Budget Responsibility's judgement on the mini-Budget – from 23 November to this month in a bid to calm the markets.   'Insult to millions'   Kwasi Kwarteng has been accused of insulting millions after he made a joke about how his mini-Budget spooked the markets. The pound fell to its lowest level for 37 years and the Bank of England was forced to intervene in the wake of his tax-cutting spree.   But in his first speech to the Conservative party conference as chancellor, he offered no apology for the days of chaos that ensued and joked that his plan had caused "a little turbulence". After the turmoil of recent days he also pledged an "ironclad commitment to fiscal discipline".   He also referenced his humiliating U-turn on scrapping the highest rate of tax, a day after the prime minister insisted her party would stick with the policy. He opened his speech by telling party members: "What a day. It has been tough." In response, there was a smattering of laughter in the hall.   Shadow chancellor Rachel Reeves said the speech showed a "Tory government completely out of touch, with no understanding on its own appalling record on growth". While Liberal Democrat Treasury spokesperson Sarah Olney said: "Laughing about the turbulence caused by this botched budget is an insult to the millions of people already facing spiralling mortgage costs." She added that Kwasi Kwarteng's "fiscal failure" saw the economy tank and his words will bring "cold comfort" to struggling families and pensioners.    On the record   "I can be frank. I know the plan put forward only 10 days ago has caused a little turbulence. I get it. We are listening and have listened, and now I want to focus on delivering the major parts of our growth package."   Chancellor Kwasi Kwarteng on the impact of his mini-Budget on markets.   From the Twitterati   "Also hearing view that once the lady's turned, she'll turn again as rebels consider push on benefits uprating. Govt source tells me scrapping 45p cut it easier to argue for earnings uplift (rather than inflation) - which real terms cut. "This is a battle potentially worth having"   Sky News' political editor Beth Rigby on Liz Truss' 45p tax rate cut u-turn and the prospect of more reversals. Essential reading   John Rentoul, The Independent: What Kwasi Kwarteng said to Tory conference – and what he really meant Tom Peck, The Independent: It's been a tough day for Kwasi Kwarteng and his planet-sized ego William Hague, The Times: Attack on nature is a mistake Tories can avoid Camilla Tominey, The Daily Telegraph: Gove claims victory over another PM as Truss squanders her Thatcherite status   OTHER NEWSLETTERS YOU MIGHT LIKE The Race Report Fortnightly, 7am (UK time) Written by Nadine White Join now Health Check Every Thursday, 7am (UK time) Written by Rebecca Thomas Join now If you can spare a minute we'd love your feedback on our newsletters. Join the conversation or follow us Please do not reply directly to this email.   You are currently registered to receive The Independent's Inside Politics email. 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