More mini-budget U-turns are expected when the chancellor makes his statement today, bringing forward measures from the Medium-Term Fiscal Plan to “support fiscal sustainability”.
This comes after the sacking of former chancellor Kwasi Kwarteng followed by a very short press conference on Friday when Prime Minister Liz Truss backtracked on the scrapping of the 45p top rate income tax and reinstated a planned increase in corporation tax, saying the mini-budget "went further and faster than markets were expecting".
Kwarteng’s fiscal plan, announced on September 23, saw the worsening of the ongoing cost of living crisis and caused the value of the pound to slump to a record low of $1.03, a Bank of England bailout of pension funds, turmoil in the financial markets and pushed up mortgage rates.
Chancellor Jeremy Hunt’s Medium-Term Fiscal Plan
The chancellor is planning to make a statement later today, and will also speak in the House of Commons this afternoon, following further conversations between the Prime Minister and the chancellor over the weekend, to “ensure sustainable public finances underpin economic growth”. It is being widely reported that there will be a delay to the plan cutting the basic rate of income tax to 19p in April and more information on the extent of savings in public sector spending may also feature.
Mr Hunt will then deliver the full Medium-Term Fiscal Plan to be published alongside a forecast from the independent Office for Budget Responsibility on 31 October - he met with the Governor of the Bank of England and the Head of the Debt Management Office last night to brief them on these plans.