Jeremy Hunt: There were mistakes in mini-budget – and some taxes will go up
The new chancellor Jeremy Hunt has said there “were mistakes” in Liz Truss and Kwasi Kwarteng’s mini-budget.
Speaking to Sky News on Saturday, Mr Hunt said: “It was a mistake when we were going to be asking for difficult decisions across the board on tax and spending to cut the rate of tax paid by the very wealthiest.”
Hunt warns of ‘difficult decisions’ – follow politics latest
He added that it was an error to “fly blind” by not accompanying the ‘fiscal event’ with an economic forecast by the Office for Budget Responsibility, which many argue sent the financial markets into turmoil.
On tax cuts, he said: “We won’t have the speed of tax cuts we were hoping for and some taxes will go up.”
Asked if this would mean a return to austerity, he replied: “I don’t think we’re talking about austerity in the way we had it in 2010. But we’re going to have to take tough decisions on both spending and tax.”
The comments signal a plan to up-end the prime minister’s entire economic strategy, in an extraordinary rebuke of the pledges that brought her into office.
Mr Hunt was appointed chancellor on Friday, an hour after his predecessor Kwasi Kwarteng was sacked after just 38 days in the job.
While his appointment was welcomed by some Tory MPs as “an experienced pair of hands”, others questioned why Mr Kwarteng was the one who had to go when he was pursuing policies Ms Truss espoused in her leadership campaign.
At a hastily-arranged news conference in Downing Street on Friday, the prime minister dismissed calls for her resignation, saying she was “absolutely determined to see through what I have promised”.
But announcing another U-turn, she said: “It is clear that parts of our mini-budget went further and faster than markets were expecting, so the way we are delivering our mission right now has to change.”
Mr Kwarteng’s plans to drop the planned rise in corporation tax from 19% to 25%, were therefore being scrapped, she announced, saving the Exchequer £18bn a year.
Is Jeremy Hunt now more powerful than the PM?
Jeremy Hunt has confirmed that Prime Minister Liz Truss’s economic vision is not only dead, but that the immediate actions of this administration will be to do almost exactly the opposite of what the prime minister promised during the summer leadership campaign.
This was a cold, hard reality check from a chancellor who is being upfront about the fact that his primary purpose is to put out the fires started by the government he’s just joined and restore some semblance of credibility to the UK economy.
Some taxes will rise, some will be cut more slowly than expected, and public spending will be trimmed with every department asked to find savings.
Does this mean pushing back the 2023 cut to the basic rate of income tax? Can the Ministry of Defence still expect its funding increase? Is there any chance of public sector pay rises reaching anywhere near inflation?
Politically, there is an argument to be made that Jeremy Hunt is now more powerful than the prime minister.
‘The last few weeks have been very tough’
Asked why he agreed to take on the difficult job of sorting out the public finances, the new chancellor said he wants to “do the right thing by the British people”.
But he added: “I want to be honest with people, we have some very difficult decisions ahead.
“The last few weeks have been very tough, but the context of that is coming out of a pandemic and a cost-of-living crisis.
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Jeremy Hunt is arguably now more powerful than prime minister Liz Truss
“No chancellor can control the markets, but what I can do is show that we can pay for our tax and spending plans and that is going to need some very difficult decisions.”
He said that all government departments would have to “find more efficiencies than they were planning to find”.
However, he declined to give any specific commitments ahead of the fiscal statement on October 31.
Asked if the NHS will still get the money that was promised in the health and social care levy, he said “the government’s already made that commitment”.
He added: “I’m not going to make any specific commitments about specific departments now, or indeed on the tax side about specific taxes because we have to look at these things in the round. And we have to make sure as we take these very difficult decisions, we’re honest with people about the situation we face.”
‘This is a disaster’
David Lammy, the shadow foreign secretary, questioned how cuts can be made given the pressure public services are under.
He said the market turmoil seen in recent weeks is a “crisis made in Number 10” and called for a general election.
He said: “As you listen to Jeremy Hunt what you hear is despite long queues in the NHS, it’s now set to get worse, despite rising class sizes in Britain we can expect our education to get worse, and with crime soaring across many communities in the country, we need police officers.
“Are they are now going to back-pedal on those undertakings that they’ve previously made?
“This is a disaster and the only way to deal with a disaster is a general election and to set our country on a certain path for the next five years.”
He claimed Ms Truss had “no mandate” for her policies.
“We cannot live in an oligarchy effectively where the Conservatives choose who leads them and as a consequence gives us a prime minister with no mandate at all to make, now, the swingeing cuts that we’re about to see.”
Mr Hunt’s comments may only add to the sense among some Tory MPs that Ms Truss is increasingly powerless in Downing Street.
Will Walden, Boris Johnson’s director of communications when he was mayor of London, called Mr Hunt an effective “caretaker prime minister”, while former Conservative leader Lord Hague warned Ms Truss’s premiership “hangs by a thread”.
Heated messages shared in Conservative Party WhatsApp groups after Ms Truss’s hastily-arranged Downing Street press conference show the party is divided about the next steps, with some MPs calling for the PM to be replaced by Rishi Sunak or Penny Mordaunt.
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The remaining 130 schoolchildren and staff abducted by gunmen from a Catholic school in Nigeria last month have been freed.
They are among more than 300 pupils and 12 staff taken from St Mary’s Catholic boarding school in Niger State on 21 November.
Fifty children managed to escape at the time, the Christian Association of Nigeria previously said, while the government said on 8 December that it had rescued 100 of those abducted.
Belongings and clothes left behind at St Mary’s School after the kidnapping. Pic: Reuters
Now the last of the pupils have been released, a spokesman for President Bola Tinubu said, bringing a close to one of the country’s biggest mass kidnappings in recent years.
“The remaining 130 schoolchildren abducted by terrorists… have now been released,” wrote presidential spokesman Bayo Onanuga in a post on X.
“They are expected to arrive in Minna on Monday and rejoin their parents for the Christmas celebration.
“The freedom of the schoolchildren followed a military-intelligence driven operation.”
The abduction has fuelled outrage over worsening insecurity in northern Nigeria, where armed gangs frequently target schools for ransom.
School kidnappings surged after Boko Haram militants abducted 276 girls from Chibok in 2014.
Over a decade later, dozens of the girls taken on that occasion remain missing.
A man suspected of killing 15 people during a shooting in Bondi Beach “conducted firearms training” with his father before the attack on a Jewish event, Australian police have said.
Naveed Akram, 24, and his father, Sajid Akram, allegedly attacked people at a Hanukkah event at Bondi Beach on 14 December, killing victims aged 10 to 87 and injuring 40 others.
Fifty-year-old Sajid Akram was killed by police at the scene, while Naveed was injured and treated in hospital. He has since been charged with 59 offences, including a terror charge, and police transferred him to a prison on Monday.
New South Wales Police have released pictures of Naveed Akram and his father holding guns, as they “conducted firearms training in a countryside location, suspected to be NSW” in late October, according to a police fact sheet seen by Sky News.
Suspected gunman Sajid Akram during the alleged firearms training with his son. Pic: NSW Police/NSW Local Court
“The accused and his father are seen throughout the video firing shotguns and moving in a tactical manner,” police said.
‘Homemade bombs’
On the day of the Bondi Beach attack, the pair allegedly threw homemade bombs and improvised explosive devices (IEDs) at the crowd of people at the gathering near the beach, but these did not detonate.
An analysis indicates that both were “viable” IEDs, according to the police file.
The suspected gunmen were allegedly armed with pipe bombs. Pic: NSW Police/NSW Local Court
Police said they found an IED in the suspects’ car. Pic: NSW Police/NSW Local Court
The information on the fact sheet was released after a suppression order was lifted by an NSW court.
Police allege the men had stored the explosives – three pipe bombs, one tennis ball bomb and one large IED – in a silver Hyundai vehicle, alongside two single-barrel shotguns, a Beretta rifle and two Islamic State flags.
The Hyundai was parked near the scene of the shooting, with the Islamic State flags allegedly displayed in the front and rear windows.
A homemade Islamic State flag was also found in the car, police said. Pic: NSW Police/NSW Local Court
‘Justification’ video found
A phone belonging to Naveed Akram was also found in the car, on which officers identified several videos, including the alleged firearms training video.
Another video shows Naveed Akram and his father sitting in front of an image of an Islamic State flag, with four long-arm guns with rounds attached seen in the background, police said.
The men “appear to summarise their justification for the Bondi terrorist attack” in the footage, according to the fact sheet.
Police said the men walked on the footbridge from where they allegedly shot at crowds two days later. Pic: NSW Local Court
Their Hyundai was previously seen on CCTV entering the car park at Bondi Beach before Naveed Akram and his father walked around the area at around 10pm on 12 December – two days before the shooting.
Police allege that this is evidence of reconnaissance and planning of a terrorist act.
On the day of the shooting, CCTV showed the men leaving a rental house in the nearby suburb of Campsie at around 3pm before driving to Bondi at around 5pm, police said.
The pair were seen carrying bulky items wrapped in blankets, which officers allege were the rifles and homemade bombs.
In the room they rented throughout December, police said they later discovered a firearm scope, ammunition, a suspected IED, 3D-printed parts for a shotgun speed loader, a rifle, a shotgun, numerous firearms parts, bomb-making equipment and two copies of the Koran.
Police said Naveed Akram’s mother told officers that she believed her husband and son were on a fishing trip when they allegedly launched the attack. She said Naveed had been calling her every day from a public phone at around 10.30am.
New gun laws
Meanwhile, the NSW government announced new draft gun laws on Monday, which the state’s premier, Chris Minns, promised would be the toughest in Australia.
The new restrictions would include making Australian citizenship a condition of qualifying for a firearms licence.
But a law like this would have excluded Sajid Akram, who was an Indian citizen with a permanent resident visa for Australia.
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He also legally owned six rifles and shotguns, which would be limited to a maximum of four guns under the new legal limit for recreational shooters.
This comes as Australia’s Prime Minister Anthony Albanese said on Monday that his government would introduce a new offence of adults trying to influence and radicalise children after already introducing legislation to criminalise hate speech and doxing.
Israel has approved 19 new Jewish settlements in the occupied West Bank in a fresh blow to the possibility of a Palestinian state.
The move brings the number of new settlements over the past few years to 69, a new record, according to Israel‘s far-right finance minister Betzalel Smotrich.
Widely considered illegal under international law, the settlements have been criticised for fragmenting the territory of a future Palestinian state by confiscating land and displacing residents.
Ganim pictured in 2005. Pic: Reuters
Under Israel’s current government, figures show, the number of settlements in the West Bank has surged by nearly 50%, rising from 141 in 2022, to 210 with the new approvals, according to Peace Now, an anti-settlement watchdog.
The government’s latest action retroactively authorises some previously-established outposts or neighbourhoods of existing settlements, and the creation of settlements on land where Palestinians were evacuated.
It also approves Kadim and Ganim, two of the four settlements dismantled in 2005, and which Israelis were previously banned from re-entering as part of Israel’s withdrawal from the Gaza Strip.
Since Israel repealed the 2005 act in March 2023, there have been multiple attempts to resettle them.
Betzalel Smotrich is among prominent names backing the settlements. Pic: AP
The move comes amid mounting pressure from the US to move ahead with the second phase of the Gaza ceasefire, which took effect on 10 October.
Mr Smotrich is one of a number of figures now prominent in Israel’s government who back the settlements.
The West Bank, east Jerusalem, and Gaza are claimed by the Palestinians for their future state, but were captured by Israel in the 1967 war.
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Today over 500,000 Jews are settled in the West Bank, in addition to over 200,000 in contested east Jerusalem.
Settlements can range in size from a single dwelling to a collection of high-rises, and the occupied territories are also host to a number of unauthorised Israeli outposts.
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