Liz Truss had to be convinced to issue statement amid market turmoil after mini-budget
Liz Truss had to be convinced to issue a government statement yesterday to calm the markets, Sky News understands.
Faced with market turmoil, spiking borrowing costs, and the drop in the value of the pound in the foreign exchange markets, the prime minister’s initial instinct was to stand firm and say little or nothing, unwilling to look like she might be shifting position.
UK policy condemned as ‘utterly irresponsible’ – pound latest
However, after a meeting with Chancellor Kwasi Kwarteng yesterday, Ms Truss agreed the Treasury would issue a statement promising further details on 23 November on how the government would ensure borrowing would not spiral out of control.
In effect this gives the government eight weeks to come up with a plan to stabilise the markets – likely to involve spending cuts in Whitehall, public services, investment and probably welfare.
The government will reject claims circulating in Whitehall that the meeting between Ms Truss and Mr Kwarteng was “argumentative” and descended into a “shouting match”.
This comes as the chancellor plans to hold further emergency meetings with global bankers this week to discourage them speculating on the pound.
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Why has the pound fallen to a record low?
Chancellor ‘more sympathetic’ to Bank’s concerns
There is deep concern in the City that Treasury ministers are still gunning for Andrew Bailey, the governor of the Bank of England, and his two most senior lieutenants, with some believing that removing this team from office would dent Britain’s global reputation for stability.
Sky News can confirm that Monday’s meeting between chancellor and prime minister concentrated on whether to issue a statement and what to say, with the two sides initially taking different positions.
One source said that the chancellor was more sympathetic to the Bank’s concerns than the PM.
The prime minister’s team were aware that the Bank of England was going to issue a statement after the close of markets on Monday.
In the end, the Treasury issued an almost simultaneous statement promising to release economic forecasts by the Office for Budget Responsibility and a plan on debt on 23 November.
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Why does the weak pound matter?
‘This needs to be explained better’
Tory MPs have expressed huge concern at what some of them regard as a reckless gamble, spending billions of pounds on tax cuts for the rich, which has spooked the markets.
Some in Number 10 are believed to blame the Tory unrest on the failure of ministers and their teams to properly explain their plans.
“Some around Truss think this all just needs to be explained better,” said one business source familiar with the conversations in Number 10.
Some in government are understood to see the market assault on the pound and government debt as a plot by the left, something which has surprised city traders.
The UK has seen its warmest start to May on record as temperatures soared to over 29C in the spring sunshine.
The Met Office said 29.3C (84.7F) had been recorded at Kew Gardens in southwest London, passing the previous 1 May record of 27.4C (81.3F) set in Lossiemouth in 1990.
Thursday was also the warmest day of the year so far, beating the previous high of 26.7C (80F) reached in Wisley, Surrey, on Wednesday.
Follow latest updates: May record broken
The seafront in Southend-on-Sea. Pic: PA
But the heat is not expected to last for the bank holiday weekend, with cooler weather starting to drift in from the north on Friday.
Temperatures are expected to ease by Friday and Saturday, meaning cooler conditions of 14C to 18C across the UK.
Stephen Dixon, a Met Office spokesman, said: “Temperatures tomorrow will be slightly reduced from what we’ve seen today, possibly 26 or 27 degrees in the far southeast of England through the day tomorrow.”
What has led to the hot spell?
Forecasters said the hot spell has been due to the jet stream remaining stuck north of the country, allowing high pressure to settle.
Last month was also the sunniest April in the UK since records began in 1910, with 47% more sunshine hours than the long-term meteorological average, and the third warmest April on record, according to provisional Met Office figures.
Rainfall was well below average for most of the UK last month, with just 56% of expected totals recorded.
And Tyne and Wear had its second driest April on record, with only 7% of its usual rainfall.
Boy’s body recovered from lake
Meanwhile, the recovery of a 16-year-old boy’s body from a lake in Nottingham prompted emergency services to warn about swimming in lakes and rivers.
Chief Inspector David Mather, of Nottinghamshire Police, said: “I would like to take this opportunity to highlight this case as a reminder of the devastating consequences of entering open water – regardless of whether people do so deliberately or inadvertently.”
A lifeguard at London Fields Lido in east London. Pic: Reuters
The London Fire Brigade said its crews responded to 565 water-related incidents last year and have already attended around 160 in the first quarter of this year, with incidents ranging from rescuing people to animals stranded on lakes and ponds.
‘Water temperatures can be dangerously cold’
Assistant commissioner for prevention and protection Craig Carter said. “Even when the sun is shining, water temperatures can be dangerously cold. Cold water shock can affect anyone, no matter how fit or experienced they are. It can lead to water inhalation, and, in the worst cases, drowning.”
People enjoy their ice creams during in St James’s Park, London. Pic: PA
The Royal National Lifeboat Institution (RNLI) offered similar warnings, advising those planning to swim at a lifeguarded beach to swim between the red and yellow flags.
Fire services warned that the warm weather means there is a “heightened” risk of grass and wildfires which can spread more easily during the dry spell, as firefighters have been battling what they described as a large wildfire in the Peak District.
The RAC also cautioned drivers on the roads, with spokesman Rod Dennis saying breakdowns are expected to “soar”, while the NHS reported searches for hay fever advice had doubled from Monday to Wednesday.
Police have revealed details around the dismissal of the co-instructor in a fatal paddleboarding trip.
Nerys Lloyd was jailed last month for the gross negligence manslaughter of Paul O’Dwyer, 42, Andrea Powell, 41, Morgan Rogers, 24, and Nicola Wheatley, 40.
The 39-year-old had also pleaded guilty to one offence under the Health and Safety at Work Act.
The four were part of a stand-up paddleboarding (SUP) tour of the River Cleddau in Pembrokeshire.
They got into difficulty after their paddleboards passed over a weir in the town of Haverfordwest during “extremely hazardous conditions” in October 2021.
Lloyd was the owner and sole director of Salty Dog Co Ltd, the firm which had organised the tour.
(L-R) Nicola Wheatley, Andrea Powell, Paul O’Dwyer and Morgan Rogers. Pics: Family handouts (via South Wales Police)
The defendant, who worked as a firearms officer for South Wales Police, was separately accused of breaching the standards of professional behaviour.
The misconduct hearing took place on 14 January 2022, but the publication of the outcome was postponed.
Now that criminal proceedings have concluded, South Wales Police has published the outcome of the hearing, which details that Lloyd was accused of making a fraudulent insurance claim.
Lloyd was dismissed without notice and placed on the police barred list.
Nerys Lloyd (centre, on crutches) leaving Swansea Crown Court after her plea hearing. Pic: PA
The decision on the outcome, compiled after the hearing, states that Lloyd did not attend it and neither had she submitted a written response to the allegations.
Lloyd made a claim against the South Wales Police Federation group insurance scheme for her vehicle’s repair costs.
The cost of the work to repair the vehicle was somewhere between £16 and £20 but the insurance claim made by Lloyd was for £577.55.
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The report into her dismissal states that, when the matter came to light, she admitted her wrongdoing and immediately apologised.
She was interviewed under caution on 11 October 2021, less than three weeks before the fatal paddleboarding tour.
When interviewed by police, Lloyd said she had made a “massive error of judgement” in relation to the insurance claim and she later repaid the amount in full.
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