Tory conference is shrouded in gloom – has Liz Truss already sealed her own fate?
A little under four weeks as prime minister and it couldn’t really have gone worse for Liz Truss.
A mini-budget that precipitated a run on the pound (it has rallied a bit since), a £65bn emergency intervention by the Bank of England to prop up pension funds, and the withdrawal of nearly 1,000 mortgage deals from the market in anticipation of a big hike in interest rates later this year.
The Conservatives are experiencing their worst polling since the late 1990s and dozens of Tories are contemplating losing their seats at the next election.
The question for me in Birmingham this week is simple: Has Liz Truss’s disastrous mini-budget already sealed her fate?
Ask Conservative MPs, and there is already a movement to try to oust her. Her insistence that she will not reverse any elements of her budget, regardless of the political toxicity or the clear economic risks, has led some MPs to say privately they want her to go.
“There needs to be policy change and personnel change,” said one senior Conservative.
“There are MPs saying she simply cannot lead us through a general election and MPs are putting forward suggestions to Sir Graham Brady about rule changes.
“One scenario is that MPs decide a new PM and it’s not put to members.
“People are very anxious.”
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When I asked the MP if Ms Truss could survive until Christmas, they told me: “I think it’s probable that she will be gone by Easter.”
‘This plan is not going to work’
A former cabinet member also confirmed that colleagues were working up options to try to remove Ms Truss, as they whispered to me that they might now stand down at the next election in the face of almost certain defeat.
“This plan is not going to work,” they said.
For a new prime minister, who in typical times might expect a honeymoon period rather than the mutterings of divorce papers, such remarks are totally damning and speak to the extremely difficult predicament she now faces.
For, just as I’d never been to a more positive Labour Party conference than the one last week, I’ve never been to a Conservative one so shrouded not just in gloom about the electoral prospects of the party, but palpable anxiety about the Truss administration.
And this is about more than even the existential threat her policies could pose to the Conservative Party.
There is genuine fear too that she might “tank the economy”. As one former senior minister told me after the mini-budget: “It’s madness and I’m scared.”
Already MPs mutter that she will have to change – the policies and the personnel, or face a showdown with her party.
One MP told me there are easily 100 MPs who could rebel against her budget. The political toxicity of abolishing the top rate of tax for those earning over £150,000 a year, while mulling a real terms benefits cut for the four million at the bottom end of the income scale relying on universal credit, is plain to see for many MPs – even if Ms Truss wants to turn a blind eye.
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But it’s not just the politics of her mini-budget, it’s the economics of it.
“We can’t ignore the cost of borrowing line item,” is how one former minister puts it. “What are the fiscal rules?”
If the prime minister can’t prove to the country, the markets, the Office of Budget Responsibility, and her backbenches that her government can achieve 2.5% growth, then the tax measures will have to be funded through debt.
And that has an obvious knock-on effect for families, with those on average mortgages having to potentially pay more in higher mortgage costs than in tax cut gains.
All of it is causing acute anxiety for MPs as they look at the polls and the prospects of their own re-election.
Plenty of those in the Sunak camp are keeping quiet for now, telling me that they want to let this play out and don’t want to take aim at Truss publicly – yet. But two outriders – former cabinet ministers Michael Gove and Julian Smith – are saying publicly what many are saying privately.
This is Mr Gove on Sunday: “I think there are two specific concerns that I have about the unfunded nature of tax cuts and about the 45p tax cuts, which we now have an opportunity to reflect on.”
“And I think it would be wise for us to recognise that they are neither the right economic nor the right political response to the situation that we face at the moment,” he told journalist Christopher Hope at a Daily Telegraph event.
When he was asked whether the policy should be reversed, he didn’t blink: “Yes”.
‘We cannot clap for carers one month and cut tax for millionaires months later’
And this was former chief whip Julian Smith in response to chairman Jake Berry’s warning on Sky News’ Sophy Ridge on Sunday show that Tories who voted against the mini-budget would lose the whip: “The first job of an MP is to act in the interest of their constituents and in the national interest.
“We cannot clap for carers one month and cut tax for millionaires months later.”
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All of it appears to be falling on deaf ears, with the PM and her team adamant that her plan is the right one and the mistakes over the past week were about the communications strategy not the policies.
As one of her key allies put it to me: “The PM gets this past week has been disruptive,” but “she firmly believes her plan for the economy is the right one.
“We’ve been stuck in a world of high taxes, cheap credit, and low growth for too long, with too much focus on tax and spend at the expense of growth.
“That status quo isn’t working, so we have to change course, otherwise we’re consigning the economy and country to long-term decline.
“We’ll do that and manage the public finances responsibly.”
Pro-growth, pro-investment, low-tax. That’s the mantra.
‘There is still so much wastage across various parts of the system’
The PM’s cabinet and top team are also supporting her.
One senior minister pointed out to me on the eve of the conference that such a big change in approach – the biggest shift in economic approach for a generation or more – was “always going to shock the markets” but the principles of leaving more money with individuals and businesses was the right one, as were the efforts – and we’re going to see what this looks like in practice later this year – to cut back on government costs (read: spending).
“There is still so much wastage across various parts of the system,” they said.
But will this government even get that far?
Ms Truss has four days in Birmingham to try and sell her plan not just to her members and MPs, but to the country.
The problem she has is that so many people seem to have stopped listening already.
A PM not for turning and a parliament in which many MPs now think they have nothing more to lose. Strap in.
World
Israel-Hamas war: ‘Vast amounts of aid needed to stave off catastrophic health crisis in Gaza,’ UN warns
Israel has agreed to support a “one-week scale-up of aid” in Gaza – but the United Nations has warned more action is needed to “stave off famine and a catastrophic health crisis”.
UN aid chief Tom Fletcher made the remarks as Israel began limited pauses in fighting across three areas of Gaza for 10 hours a day to address the worsening humanitarian situation.
Israel cut off all supplies to Gaza’s population from the start of March. It then reopened aid centres with new restrictions in May, but said the supply had to be controlled to prevent it from being stolen by Hamas militants.
A Palestinian man in Beit Lahia carries aid that entered Gaza through Israel. Pic: Reuters
On Saturday, reports referencing US government data said there was no evidence Hamas had stolen aid from UN agencies.
Images of emaciated Palestinian children have led to widespread criticism of Israel’s actions in Gaza, including by allies who are calling for an end to the war.
Mr Fletcher said one in three people in Gaza “hasn’t eaten for days” and “children are wasting away”.
He added: “We welcome Israel’s decision to support a one-week scale-up of aid, including lifting customs barriers on food, medicine and fuel from Egypt and the reported designation of secure routes for UN humanitarian convoys.
“Some movement restrictions appear to have been eased today, with initial reports indicating that over 100 truckloads were collected.
“This is progress, but vast amounts of aid are needed to stave off famine and a catastrophic health crisis. Across the UN agencies and humanitarian community, we are mobilised to save as many lives as we can.”
An aircraft drops humanitarian aid over Gaza on Sunday. Pic: Reuters
The Israel Defence Forces said yesterday that it is halting military operations in Muwasi, Deir al Balah and Gaza City daily from 10am to 8pm local time (8am to 6pm UK time) until further notice.
Combat operations have continued outside of this 10-hour window. Health officials in Gaza said Israeli strikes killed at least 41 Palestinians overnight into Sunday morning, including 26 seeking aid.
In a statement, the IDF said it would also establish secure routes to help the UN and aid agencies deliver food and other supplies.
A map showing the three areas of Gaza where military action has been paused
Israel’s announcement of what it calls a “tactical pause” in fighting comes after it resumed airdrops of aid into Gaza.
While the IDF reiterated claims there is “no starvation” in the territory, it said the airdrops would include “seven pallets of aid containing flour, sugar and canned food to be provided by international organisations”.
Palestinian sources confirmed that aid had begun dropping in northern parts of the territory.
Palestinians in Beit Lahia carry aid supplies that entered Gaza through Israel. Pic: Reuters
Sabreen Hasson, a Palestinian mother who travelled to an aid point near the Zikim crossing to collect supplies, said: “I came to get flour for my children because they have not tasted flour for more than a week, and thank God, God provided me with a kilo of rice with difficulty.”
But Samira Yahda, who was in Zawaida in central Gaza, said: “We saw the planes, but we didn’t see what they dropped… they said trucks would pass, but we didn’t see the trucks.”
Another Palestinian told the AP news agency that some people feared going out and having a box of aid fall on their children.
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Baby Zainab starved to death in Gaza
Gaza is expected to be a focus during talks Sir Keir Starmer and Donald Trump in Scotland today.
Downing Street said Sir Keir will raise “what more can be done to secure the ceasefire [in the Middle East] urgently”, during the meeting at the US president’s Turnberry golf course in Ayrshire.
Reports also suggest the prime minister is planning to interrupt the summer recess and recall his cabinet to discuss the crisis on Tuesday.
Talks in Qatar over a ceasefire ended on Thursday after the US and Israel withdrew their negotiating teams.
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Bob Geldof: ‘Israeli authorities are lying’
Mr Trump blamed Hamas for the collapse of negotiations as he left the US for Scotland, saying the militant group “didn’t want to make a deal… they want to die”.
Meanwhile the exiled head of Hamas in Gaza, Khalil al Hayya, has warned ceasefire negotiations with Israel were “meaningless under continued blockade and starvation”.
In a recorded speech, he added: “The immediate and dignified delivery of food and medicine to our people is the only serious and genuine indication of whether continuing the negotiations is worthwhile.”
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Israel intercepts Gaza aid boat
During a meeting with the European Commission President Ursula von der Leyen yesterday, Mr Trump emphasised the importance of securing the release of hostages held by Palestinian militants in Gaza.
He said: “They don’t want to give them back, and so Israel is going to have to make a decision.
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Starmer says UK will help drop aid to Gaza
“I know what I’d do, but I don’t think it’s appropriate that I say it. But Israel is going to have to make a decision,” he said.
Mr Trump also repeated claims, without evidence, that Hamas was stealing food coming into Gaza and selling it.
Israel has begun a pause in fighting in three areas of Gaza to address the worsening humanitarian situation.
The IDF said it would halt fighting in three areas, Muwasi, Deir al-Balah and Gaza City, from 10am to 8pm local time until further notice, beginning today.
In a statement, the IDF said it would also establish secure routes to help the UN and aid agencies deliver food and other supplies.
Palestinians carry aid supplies. Pic: Reuters
Israel’s announcement of what it calls a “tactical pause” in fighting comes after it resumed airdrops of aid into Gaza.
While the IDF reiterated claims there is “no starvation” in Gaza, it said the airdrops would include “seven pallets of aid containing flour, sugar and canned food to be provided by international organisations”.
Reports suggest aid has already been dropped into Gaza, with some injured after fighting broke out.
Pic: IDF
In other developments, Bob Geldof has accused Israeli authorities of “lying” about starvation in the territory – telling Sunday Morning With Trevor Phillips the IDF is “dangling food in front of starving, panicked, exhausted mothers”.
He told Sky News: “This month, up to now, 1,000 children or 1,000 people have died of starvation. I’m really not interested in what either of these sides are saying.”
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Bob Geldof: ‘Israeli authorities are lying’
Israel cut off all supplies to Gaza from the start of March. It then reopened aid centres with new restrictions in May, but said the supply had to be controlled to prevent it from being stolen by Hamas militants.
On Saturday, reports referencing US government data said there was no evidence Hamas had stolen aid from UN agencies.
The IDF’s international spokesperson, Lieutenant Colonel Nadav Shoshani, described such reports as “fake news” and said Hamas thefts have been “well documented”.
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Malnourished girl: ‘The war changed me’
Airdrops ‘expensive and inefficient’
It comes as the Hamas-run health ministry in Gaza said as of Saturday, 127 people have died from malnutrition-related causes, including 85 children.
They include a five-month-old girl who weighed less than when she was born, with a doctor at Nasser Hospital describing it as a case of “severe, severe starvation”.
Health workers have also been weakened by hunger, with some putting themselves on IV drips so they can keep treating badly malnourished patients.
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Aid waiting to be distributed in Gaza
On Friday, Israel said it would allow foreign countries to airdrop aid into Gaza – but the UN Relief and Works Agency (UNRWA) has warned this will not reverse “deepening starvation”.
UNRWA head Philippe Lazzarini described the method as “expensive” and “inefficient”, adding: “It is a distraction and screensmoke. A manmade hunger can only be addressed by political will.
“Lift the siege, open the gates and guarantee safe movements and dignified access to people in need.”
UNRWA has the equivalent of 6,000 trucks in Jordan and Egypt waiting for permission to enter Gaza, he added.
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PM says UK will help drop aid to Gaza
MSF, also known as Doctors Without Borders, warned on Friday that 25% of young children and pregnant women in Gaza are now malnourished, and said the lack of food and water on the ground was “unconscionable”.
The UN also estimates Israeli forces have killed more than 1,000 people seeking food, the majority near the militarised distribution sites of the US-backed aid distribution scheme run by the Gaza Humanitarian Foundation.
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In a statement on Friday, the IDF had said it “categorically rejects the claims of intentional harm to civilians”, and reports of incidents at aid distribution sites were “under examination”.
The Gaza Humanitarian Foundation (GHF) has also previously disputed these deaths were connected with its organisation’s operations, with director Johnnie Moore telling Sky News: “We just want to feed Gazans. That’s the only thing that we want to do.”
Bob Geldof has accused the Israeli authorities of “lying” about starvation in Gaza – after Israel’s government spokesperson claimed there was “no famine caused by Israel”.
Earlier this week, David Mencer claimed that Hamas “starves its own people” while on The News Hour with Mark Austin, denying that Israel was responsible for mass hunger in Gaza.
Appearing on Sunday Morning with Trevor Phillips, Geldof said the claims are false.
Follow latest: Gaza aid airdrops a ‘smokescreen’ and ‘distraction’
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Israel challenged on starvation in Gaza
Sir Trevor asked the Live Aid organiser: “The Israeli view is that there is no famine caused by Israel, there’s a manmade shortage, but it’s been engineered by Hamas.
“I guess the Israelis would say we don’t see much criticism from your side of Hamas.”
In response, Geldof said “that’s a false equivalence” and “the Israeli authorities are lying”.
The singer then added: “They’re lying. [Benjamin] Netanyahu lies, is a liar. The IDF are lying. They’re dangling food in front of starving, panicked, exhausted mothers.
“And while they arrive to accept the tiny amount of food that this sort of set up pantomime outfit, the Gaza Humanitarian Front, I would call it, as they dangle it, then they’re shot wantonly.
“This month, up to now, 1,000 children or 1,000 people have died of starvation. I’m really not interested in what either of these sides are saying.”
He added: “If the newsfeeds and social feeds weren’t so censored in Israel, I imagine that the Israeli people would not permit what has been done in their name.”
Asked about the UK government’s reaction, Geldof said it was “not enough”.
“This is a distraction thing about ‘let’s recognise the state ‘ – absolutely, it should have been done ages ago, but it’s not going to make any material difference,” he said, referring to calls for Sir Keir Starmer to recognise Palestine as a state.
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Gaza: ‘This is man-made starvation’
In the Sky News interview earlier this week, Mr Mencer added: “This suffering exists because Hamas made it so. Here are the facts. Aid is flowing, through the Gaza Humanitarian Foundation. Millions of meals are being delivered directly to civilians.”
He also claimed that, since May, more than 4,400 aid trucks had entered Gaza carrying supplies.
It comes after MSF, also known as Doctors Without Borders, warned 25% of young children and pregnant women in Gaza are now malnourished.
The charity said Israel’s “deliberate use of starvation as a weapon” has reached unprecedented levels, and said that at one of its clinics in Gaza City, rates of severe malnutrition in children under five have trebled over the past two weeks.
MSF then described the lack of food and water on the ground “unconscionable”.
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Aid waiting to be distributed in Gaza
In a statement to Sky News, an Israeli security official said that “despite the false claims that are being spread, the State of Israel does not limit the number of humanitarian aid trucks entering the Gaza Strip”.
It then blamed other groups for issues delivering aid. They said: “Over the past month, we have witnessed a significant decline in the collection of aid from the crossings into the Gaza Strip by international aid organisations.
“The delays in collection by the UN and international organisations harm the situation and the food security of Gaza’s residents.”
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The IDF also told Sky News: “The IDF allows the American civilian organisation (GHF) to distribute aid to Gaza residents independently, and operates in proximity to the new distribution zones to enable the distribution alongside the continuation of IDF operational activities in the Gaza Strip.
“Following incidents in which harm to civilians who arrived at distribution facilities was reported, thorough examinations were conducted in the Southern Command and instructions were issued to forces in the field following lessons learned.
“The aforementioned incidents are under review by the competent authorities in the IDF.”
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