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Liz Truss has refused to commit to raising benefits in line with inflation, despite growing pressure from a cabinet minister and senior Tory MPs.

Speaking to broadcasters in Birmingham, where the Tory party conference is underway, the prime minister said she had “not made a decision” on whether to stick to the benefit uprate promised by her predecessor Boris Johnson.

She added: “Of course, there will be discussions about the way forward on commitments like benefits, on how we deal with future budgets.

“I’m very clear that going into this winter, we do need to help the most vulnerable.”

While Ms Truss has not ruled out a real-terms cuts to benefits, she has said she is “fully committed” to raising pensions in line with inflation.

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PM Liz Truss interview in full

When asked about the difference in approach for people on pensions compared to benefits, Ms Truss told LBC’s Nick Ferrari that “people are in a different situation, depending on which stage of life they’re in”.

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She added: “When people are on a fixed income, when they are pensioners, it is quite hard to adjust. I think it’s a different situation for people who are in the position to be able to work.”

Asked if she will rule out austerity, she said she has committed to reducing debt as a proportion of national income over the medium term.

“Well, I wouldn’t use the term you describe. What I’m talking about is fiscal responsibility,” she added.

Ministers hint at cabinet split

Ms Truss is facing a fresh battle with Conservative MPs over a potential benefits squeeze and cuts to public spending, after already being forced into making a policy U-turn on her tax cuts yesterday.

It is understood that Downing Street is considering increasing Universal Credit using a lower metric, such as the increase in average earnings, instead of inflation.

Penny Mordaunt became the first cabinet minister to openly oppose the idea of not uprating benefits with inflation, telling Times Radio: “I’ve always supported – whether it’s pensions, whether it’s our welfare system – keeping pace with inflation. It makes sense to do so. That’s what I voted for before.”

The Leader of the House of Commons added: “We want to make sure that people are looked after and that people can pay their bills. We are not about trying to help people with one hand and take away with another.”

Ms Truss refused to be drawn on whether she welcomed those views, telling reporters: “As I’ve said, no decision has been made yet on that issue. And I look forward to having those discussions.”

Ms Mordaunt appears to have taken a different line to Brandon Lewis, the justice secretary – hinting at a cabinet split on the matter.

He refused to give his position when asked about the government’s plans to uprate benefits on Sky News, telling Kay Burley: “There is a process around this that the Department for Work and Pensions, Chloe Smith, the secretary of state, works through.”

He said announcements will be made “over the autumn”, adding: “I’m not going to pre-judge what that will be.”

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Should benefits rise with inflation?

The comments come after a slew of senior Tories called on the PM to row back on cutting public spending in the middle of the cost of living crisis.

On Monday, senior Conservative MP Damian Green told Sky News: “The government should uprate in line with inflation. The previous government said it was going to, so people are expecting this.”

Former transport secretary Grant Shapps has also stepped up the pressure. Asked if he would want to see benefits increased in line with inflation, he said: “Of course, every politician would want to see that.”

Benefits are usually uprated in line with the consumer price index (CPI) rate of inflation from September, with the rise coming into effect the following April.

The Institute for Fiscal Studies estimates that each percentage point rise in CPI adds £1.6 billion to welfare spending.

The latest row comes as the government dramatically dropped its plans to abolish the 45% tax rate on earnings over £150,000 following widespread criticism, including from Tory MPs.

Ms Truss defended the U-turn on Tuesday, saying the government “listens” and the tax cut “wasn’t a core part” of the growth plan.

But she repeatedly refused to say if she trusts her chancellor, Kwasi Kwarteng, when challenged, instead saying the two work “very closely”.

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Japan could be hours away from running out of Asahi

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Japan could be hours away from running out of Asahi

Japan could be hours away from running out of Asahi, the country’s most popular beer.

Dozens of factories nationwide have ground to a halt following a cyber attack on Monday.

The breach disabled the company’s ordering and delivery systems – and also took its call centre operations offline.

Supermarkets and Japanese pubs known as izakayas risk running super dry, with some retailers raising fears of potential panic buying.

Reuters file pic
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Reuters file pic

According to NHK, Asahi Group has now had to suspend plans to launch new products including soft drinks, coffee and throat lozenges.

One wholesaler expects to run out of beer kegs by Saturday at the latest, meaning they’ll no longer be able to supply booze to retailers.

They are now considering whether to start selling other brands as a temporary measure.

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Akira Kudo, who runs an izakaya in Tokyo, has been told that one of the two brands of Asahi he regularly purchases is now out of stock.

He’s now unable to predict when pints can be poured again.

“We have received beer from the wholesaler to replace Asahi, but we would like to avoid using other manufacturers if possible, so we will consider our options until the very last minute,” Akira added.

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A shortage may leave Japanese drinkers unimpressed. While there are other breweries in the country, Asahi has a fiercely loyal following.

Figures from Kirin Holdings suggest that the typical consumer drank 34.5 litres of beer a year in 2022, the equivalent of 54 large bottles.

Asahi executives are now consulting with the police and trying to determine whether the company has fallen victim to ransomware.

They have stressed that no personal information or customer data has been leaked.

Brewing operations outside of Japan – including in the UK – are also unaffected.

There have been a series of high-profile cyber attacks on well-known brands in recent months – including Marks and Spencer, the Co-op and Jaguar Land Rover (JLR).

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Jaguar Land Rover cyber attack: ‘We need certainty’ on aid, supplier pleads

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Jaguar Land Rover cyber attack: 'We need certainty' on aid, supplier pleads

A member of cyber attack-hit Jaguar Land Rover’s (JLR) supply chain has told Sky News the government must act to safeguard the sector as it has seen no financial relief to date.

Mike Beese, who owns Walsall-based Genex UK, was speaking as an industry body complained that support revealed by the government last week was failing to reach suppliers.

While unveiling a £1.5bn loan guarantee to JLR last Saturday, Business and Trade Secretary Peter Kyle said it would “help support the supply chain and protect skilled jobs in the West Midlands, Merseyside and throughout the UK.”

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Many interpreted the liquidity offer as a bailout, of sorts, that JLR would draw down on and distribute to ease pressure on direct and indirect suppliers.

Businesses affected by the production shutdown are now arguing they need the support they thought they were being promised by the Secretary of State.

It is unclear how Mr Kyle’s department and the chancellor saw the loan guarantee working in practice.

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JLR is understood to have not seen a need to draw on any such arrangement to date as its direct suppliers – the companies it deals with – have continued to be paid through existing funds.

It expects that money to trickle down to lower tiers of that supply chain.

The production shutdown has entered a second month and there is no visibility on when factories will get back to full speed.

Mr Beese said it was for this reason that the government had to intervene, potentially through a loan scheme for suppliers. “We need certainty”, he declared.

Pic: Genex UK
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Pic: Genex UK

He said of his own customers: “We need that money to come in so we can pay our suppliers. “That money needs to cascade down the tiers,” he added [but] “it’s not going to be enough and you’ve got to make that up at some point.

Mr Breese, who employs 17 people and provides parts for several major JLR suppliers, said he attached no blame to JLR, which has been losing at least £50m a week since the attack in late August.

He also laid no fault at the door of the companies he supplied. “Only the government” could bring the relief the industry needed, he argued, while explaining that terms from lenders were out of reach given the scale of the uncertainty.

Commenting on the toll the crisis was taking, Mr Beese added: “It’s very stressful… people in the same boat are ringing me to be paid. “My staff all need certainty as well… these people aren’t just a number, they have families”, he said.

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Inside factory affected by Jaguar Land Rover shutdown

The president of the Confederation of British Metalforming (CBM), Stephen Morley, said: “We need to find a way to get money quickly to where it is needed most, to prevent the supply chain from completely collapsing and that could be an additional type of loan.

“JLR is rightly focused on getting payments through to their first-tier suppliers, and it’s best we allow them to complete that process.

“Our focus now must be on ensuring that second tier and smaller suppliers in the chain are supported, so the whole framework is in place when production restarts.”

JLR revealed earlier this week that it planned to resume limited production “in the coming days” as it continues efforts to restart key IT systems.

No firm date has sine been announced.

A spokesperson for JLR said: “As the controlled, phased restart of our operations continues, we are delivering solutions to support our suppliers through the period of disruption caused by the cyber incident.

“This includes establishing a supplier help desk with additional resources, putting in place a manual payment system to clear down outstanding invoices, and working to re-establish the automated supplier payment systems.

“We would like to thank everyone connected with JLR for their continued patience, understanding and support. We know there is much more to do but the foundational work of our recovery is firmly underway, and we will continue to provide updates as we progress.”

A spokesperson for the Department for Business and Trade said: “We acted swiftly to protect JLR, recognising the importance of the tens of thousands of people they employ directly and indirectly and to provide the company with liquidity at a key time.

“We continue to work with JLR and suppliers directly to understand the impact of the cyber attack – including on tier 2 and tier 3 suppliers – and how the support put in place is helping them.”

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Tesco promises ‘strong deals’ amid ‘intensive’ price war – as profits set to hit £3bn

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Tesco promises 'strong deals' amid 'intensive' price war - as profits set to hit £3bn

The UK’s most popular supermarket has said it is to introduce “strong deals” over the next three months as it prepares for Christmas.

It’s being done as Tesco chief executive Ken Murphy said he expected people to spread Christmas spending over a wider period to be more manageable and affordable.

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The supermarket price war, spurred by grocers competing to lower costs and win customers, “could be even more intensive” over the next months, Mr Murphy said.

Tesco, which is the UK’s number one supermarket by market share, has been successful in this fight, saying it was “continuing to win with customers”.

Defending higher profits

As a result, it said on Thursday that it expected annual profit to be higher than first thought, in the region of £2.9bn to £3.1bn.

It’s attracted criticism from the union Unite, whose general secretary Sharon Graham said Tesco “has profited from the cost-of-living crisis, making a fortune through unfairly inflating grocery prices”.

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Warning on food inflation ahead

But Tesco’s chief financial officer Imran Nawaz defended the company’s profits, saying its investment to bring costs down “worked better than we thought”.

“When you sell more, you make more.”

This was the biggest contributor to the higher profit outlook, he added.

‘Enough is enough’

A lot of the overall price rises in the UK, however, are due to policy measures, Mr Murphy said, referring to a new plastic packaging tax and higher employers’ national insurance contributions.

When asked what the chain hoped to see in the upcoming 26 November budget, Mr Murphy said he didn’t want it to be “harder for the industry to deliver great value for customers”.

After last year’s budget delivered “substantial additional operating costs”, he said, “enough is enough”.

The CEO said he had made “no decision” and “can’t speculate” on whether Tesco would close shops if its larger stores are not made exempt from paying business rates.

The company pays more than £700m a year in tax on premises, he added.

Consumer trends

The supermarket chain has also benefited from the trend it observed of people cooking at home and eating in more, it said.

There’s been an uptick in sales of fresh food and a “meaningful increase” in cooking from scratch.

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This could be a hangover from the COVID-19 era, maybe due to the growth of streaming services, or potentially a money-saving exercise, Mr Murphy said.

“It’s hard to put your finger on the single reason, but it’s definitely a trend”.

Similarly, Tesco’s luxury own-brand line continued to grow in popularity with double-digit sales growth for the third year in a row.

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