Chancellor Kwasi Kwarteng insists he is ‘not going anywhere’ – and hints at mini-budget U-turn
The chancellor has insisted he is “not going anywhere” amid the economic turmoil – and when asked if he was about to do a U-turn on corporation tax he said: “Let’s see”.
Speaking earlier in the US where he is attending IMF meetings, Kwasi Kwarteng told reporters that he remains “totally focused” on delivering the government’s growth plan.
Later, in response to a question about how markets “have improved today because they think you’re about to do a U-turn on corporation tax”, Mr Kwarteng said: “Let’s see,” according to The Telegraph.
It is his strongest indication yet of a possible change of course.
During a visit to Washington, Mr Kwarteng was asked whether he and Liz Truss, the prime minister, will be in their jobs this time next month.
“Absolutely. 100%. I’m not going anywhere,” he said.
The chancellor admitted there has been some “domestic turbulence” since he unveiled his tax-cutting mini-budget at the end of September and the pound fell to record lows against the dollar, but said there is “a very dicey situation globally”.
Truss is out ‘and we have the numbers’, says Tory MP – politics latest
“I speak to Number 10, the PM all the time, and we are totally focused on delivering the growth plan,” he said.
Pushed on whether there will be any more reversals of policies in the mini-budget, Mr Kwarteng said: “I am totally focused on the growth agenda.”
Last week, after open revolt from Tory MPs and a surge in support for Labour in the polls, Ms Truss and Mr Kwarteng abandoned the plan to abolish the highest 45% tax rate.
Sky News understands discussions are under way in Downing Street over whether to scrap some of the contentious proposals which remain in the chancellor’s tax-cutting mini-budget.
The proposed changes to corporation tax and dividend tax are those understood to be under discussion.
Downing Street insisted earlier on Thursday that there will be no more U-turns on policies in the government’s tax-cutting mini-budget despite pressure from Conservative MPs for changes to be made.
Asked to confirm there would be no further reversals, the prime minister’s official spokesman said: “Yes, as I said to a number of questions on this yesterday – and the position has not changed from what I set out to you all then.”
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Discussions happening over whether to scrap parts of the mini-budget
Ms Truss faces open revolt in her party over the £45bn package of unfunded tax cuts in the mini-budget, which unleashed chaos in the markets when it was announced last month.
Former home secretary Priti Patel became the latest senior Tory to suggest the government could be forced into another U-turn, telling Sky News “market forces” could make a reversal on corporation tax cuts unavoidable.
The chancellor will set out his debt-cutting plan in more detail on 31 October, having bowed to pressure to bring the date forward from 23 November given the economic turbulence.
Earlier on Thursday, James Cleverly, the foreign secretary, refused to say there would be no more reversals.
He told Sky News the Halloween statement would give “a more holistic assessment of the public finances and our response to the global headwinds that every democracy, every economy in the world is facing”.
Pressed on the plan to axe the increase in corporation tax from 19% to 25% in April, Mr Cleverly said it is “absolutely right” the government helps businesses to “stay competitive” and “stay afloat”.
The Treasury had vowed to reduce the rate of income tax on dividends by 1.25 percentage points.
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How long can Truss stay in power?
Mr Kwarteng is meeting with International Monetary Fund (IMF) leaders in Washington DC today, after the institution’s chief economist said tax cuts threatened to cause “problems” for the UK economy.
Speaking at a press conference in Washington, the managing director of the IMF said it is sometimes right for a “recalibration” of policies as she was questioned over reports of further U-turns after the mini-budget market chaos.
Kristalina Georgieva said: “Our message to everybody, not just the UK, is that at this time, fiscal policy should not undermine monetary policy.”
Read more:
What on earth is happening in UK markets?
What are bonds and where do they fit in the mini-budget crisis?
Meanwhile, in a post on social media on Thursday, former Conservative chancellor George Osborne questioned why Ms Truss and Mr Kwarteng would wait for the chancellor’s statement on 31 October to perform an “inevitable U-turn” on their mini-budget.
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Tories ‘must get back to being fiscally responsible’
On Wednesday, Mel Stride, the Tory chairman of the Commons Treasury Committee, said that given Ms Truss’s commitments to protect public spending, there was a question over whether any plan that did not include “at least some element of further row back” on the tax-slashing package can reassure investors.
While David Davis, the Tory former minister, called the mini-budget a “maxi-shambles” and suggested reversing some of the tax cuts would allow Ms Truss and Mr Kwarteng to avert leadership challenges for a few months.
When Canada goes to the polls today, it might be the second election Donald Trump wins in six months.
The US president has transformed Canada’s political landscape, and the “Trump effect” looks like it will be the difference between winners and losers.
Tariffs, and his threat to annexe the country as the 51st state, have provoked a surge in Canadian nationalism, and it’s made a favourite of the candidate styled anti-Trump.
Step forward, Mark Carney: Former governor of the Bank of England, now Canadian prime minister.
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‘Canada will win’
His ruling Liberal party had been written off as an electoral contender. Canadians had turned their back on the party after a decade in power under Carney’s predecessor, Justin Trudeau.
The opposition Conservative Party, under the effective leadership of Pierre Poilievre, grew to a 25-point lead in the polls on the promise of change on the economy, crime and a chronic housing crisis.
However, his conservative politics are more aligned with the neighbour in the White House and, in Canada right now, it’s not a good look.
Read more: Everything you need to know about the election
Pierre Poilievre led the Conservatives to a 25-point lead before Trudeau stepped down. Pic: Reuters
In a stunning reversal of fortune, the Conservative Party’s lead vanished within weeks, as Canadians turned to Carney as the choice to take on Trump.
If he wins, the swing from Conservative to Liberal will be the biggest swing in the polls in recent democratic history.
Carney, 60, is the former governor of the Bank of Canada, as well as England. He replaced Mr Trudeau as Liberal Party leader and Canadian prime minister after his predecessor stepped down last month.
Polls indicate that Canadians see Carney as a stronger choice to negotiate with Donald Trump. He is a veteran of economic turmoil, having dealt with the 2008 financial crisis and Brexit.
Pierre Poilievre and Mark Carney after an English-language leaders’ debate in Montreal. Pic: Reuters
At a weekend news conference, Sky News asked the Canadian prime minister what lessons he’d learned from Brexit that could be applied to his dealings with Donald Trump.
He replied: “The lessons of Brexit are beginning to be applied. When you break off, or substantially rupture, trading relationships with your major trading partners, including the most important trading partner of the United States, you end up with slower growth, higher inflation, higher interest rates, volatility, weaker currency, a weaker economy.
“We’re in the early stages of that in the United States, and that’s one of the important things here. With respect to influencing the president, with respect to the dynamics of a negotiation, America’s going to get weaker as time goes on, we’re going to get stronger.”
Canada’s vote is as close as it gets to a single-issue election.
Carney’s position as favourite is reinforced consistently by the opinion polls, although the gap narrowed as election day approached.
It could yet be tight.
World
Trump ‘very disappointed’ in Russian strikes on Ukraine and calls for Putin to ‘sit down and sign a deal’
Donald Trump has said he’s “very disappointed” with Russia as he continues to push for a peace deal to end the war in Ukraine.
On Saturday, the US president met with Volodymyr Zelenskyy at the Vatican for their first face-to-face meeting since their explosive White House summit.
The Ukrainian president said the meeting ahead of Pope Francis’s funeral could end up being “historic.” Hours later, Mr Trump questioned Vladimir Putin’s appetite for peace in a Truth Social post.
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From Saturday: Trump meets Zelenskyy at funeral
Speaking before boarding Air Force One on Sunday, Mr Trump again said the meeting went well, and that the Ukrainian leader was “calmer”.
“I think he understands the picture, I think he wants to make a deal,” he said, before turning to Mr Putin and Russia.
“I want him to stop shooting, sit down and sign a deal,” the US president said, adding he was “very disappointed that they did the bombing of those places (including Kyiv, where nine people were killed in a Russian airstrike on Friday) after discussions”.
However, Mr Trump said he thinks Mr Zelenskyy is ready to give up Crimea, which the Ukrainian leader has repeatedly said he would refuse to do.
He added that “we’ll see what happens in the next few days” and said “don’t talk to me about Crimea, talk to Obama and Biden about Crimea”.
Russia annexed Crimea in 2014, while Barack Obama was president.
Meanwhile, US secretary of state Marco Rubio told Sky’s US partner network NBC News that a peace deal to end the war was “closer in general than they’ve been any time in the last three years, but it’s still not there”.
“If this was an easy war to end, it would have been ended by someone else a long time ago,” he added on the Meet the Press show.
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It comes after North Korea confirmed it had deployed troops to fight for Russia, months after Ukraine and Western officials said its forces were in Europe.
State media outlet KCNA reported North Korean soldiers made an “important contribution” to expelling Ukrainian forces from Russian territory, likely to be the Kursk region.
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KCNA said leader Kim Jong Un made the decision to deploy troops to Russia and notified Moscow, and quoted him as saying: “They who fought for justice are all heroes and representatives of the honour of the motherland.”
It also quoted the country’s ruling Workers’ Party as saying the end of the battle to liberate Kursk showed the “highest strategic level of the firm militant friendship” between North Korea and Russia.
Last June, Mr Kim and Mr Putin signed a comprehensive strategic partnership treaty after a state visit – his first to the country in 24 years.
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From June 2024: Putin drives Kim around in luxury limo during state visit
The North Korean leader promised at the time “full support and solidarity to the Russian government, army and people in carrying out the special military operation in Ukraine”.
World
40 killed in blast at Iran’s biggest port as Tehran denies explosion ‘linked to fuel for missiles’
At least 40 people have been killed and several hundred more injured after an explosion and fire at Iran’s largest port, according to state media.
The blast, at the Shahid Rajaei container hub near the southern city of Bandar Abbas, happened on Saturday as Iran held a third round of talks with the US in Oman about Tehran’s nuclear programme.
Shipping containers burned, goods inside were badly damaged and the explosion was so powerful that windows several miles away were shattered, reports said.
Iranian Red Crescent rescuers work at the site of the blast. Pic: Reuters
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The blast at the Shahid Rajaei port happened as Iran and the US met for the third round of negotiations over Tehran’s nuclear program.
Helicopters and aircraft dumped water from the air on the blaze and by Sunday afternoon it was 90% extinguished, the head of Iran’s Red Crescent Society told state media.
Officials said port activities had resumed in unaffected parts of Shahid Rajaei.
Out of the 752 people who had received treatment for their injuries, 190 were still being treated in medical centres on Sunday, according to Iran’s crisis management organisation.
Chemicals at the port were suspected to have worsened the blast, but the exact cause of the explosion was not clear.
Iran’s defence ministry denied international media reports that the explosion may be connected to the mishandling of solid fuel used for missiles.
The reports were “aligned with enemy psyops [psychological operations]”, according to a ministry spokesperson, who told state TV the blast-hit area did not contain any military cargo.
Firefighters work to extinguish the blaze. Pic: AP
Pic: AP
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According to the Associated Press, British security company Ambrey said that the port in March received sodium perchlorate, which is used to propel ballistic missiles and the mishandling of which could have led to the explosion.
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The Financial Times previously reported two Iranian vessels had shipped from China enough of the ingredient to propel up to 260 mid-range missiles.
It was reportedly to help Tehran replenish stocks after its missile attacks on Israel in 2024.
Iran’s military has sought to deny the delivery of sodium perchlorate from China.
Iran’s state-run Irna news agency reported on Sunday that Russian President Vladimir Putin deployed several emergency aircraft to Bandar Abbas to provide help.
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