Brevia Consulting is providing a weekly round-up and analysis of the UK headlines. This week, read about Prime Minister Liz Truss’ resignation, her day of turmoil in Parliament following the Labour Party’s Opposition Day debate on fracking, and Chancellor Kwasi Kwarteng’s replacement by Jeremy Hunt.
PRIME MINISTER TRUSS RESIGNS AFTER JUST 44 DAYS IN OFFICE
The Prime Minister Liz Truss announced her resignation on Thursday following just six weeks in office. This makes her the shortest serving Prime Minister in UK history. The Prime Minister stated that she could no longer deliver the mandate on which she was elected by the Conservative Party.[1] A leadership challenge will now take place, with nominations for candidates closing on Monday, and voting by Conservative Party members taking place online from Tuesday until 11:00am on Friday. Liz Truss will remain Prime Minister until the new leader is selected. Chancellor Jeremy Hunt has announced he will not run in the contest, but other senior Tories are considering running.[2] These include Penny Mordant, Rishi Sunak and Boris Johnson. The Labour leader Sir Keir Starmer has called for an immediate General Election.
A DAY OF OPPOSITION FOR PRIME MINISTER TRUSS
Prime Minister Liz Truss’ resignation on Thursday was preceded by a day of turmoil for the Conservative Party. On Wednesday, the Labour Party held an Opposition Day Debate calling on Government to introduce a ban on fracking.[3] Party whips initially urged MPs to treat this debate as a vote of confidence in the Government with a three-line whip. However, minutes before the vote, Climate Minister Graham Stuart MP stated that the motion would not be subject to a confidence vote. The motion was ultimately defeated by 96 votes, with 32 Conservative MPs including Kwasi Kwarteng abstaining from the vote. Following scenes of ‘chaos’ in Parliament, both the Chief Whip Wendy Morton and Deputy Chief Whip Chris Whittaker resigned.[4] This loss of control by the Truss Government seemed to lay the groundwork for her resignation the following afternoon.
KWARTENG SACKED AND TAX CUTS SCRAPPED BY HUNT
Last Friday, Chancellor Kwasi Kwarteng was sacked and replaced by the experienced former Cabinet Minister Jeremy Hunt.[5] In a press conference following Kwarteng’s departure, the Prime Minister announced that the corporation tax cut would not be going ahead. On Monday, the new Chancellor went further, announcing almost a complete reversal of Kwarteng’s Growth Plan. All the tax cuts announced by Kwarteng were reversed, except the cut to stamp duty and the reversal of the National Insurance increase, which remain.[6] Hunt’s actions were seen as an attempt to calm the markets, which have been in turmoil since the Growth Plan was announced. Hunt also announced that difficult spending cuts would be required to meet the Government’s fiscal targets, with ‘every government department’ required to find further savings.[7]
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Notes
[1] Prime Minister’s Office, 10 Downing Street, ‘Prime Minister Liz Truss’s statement in Downing Street: 20 October 2022’, 20 October 2022, Link
[2] BBC News, ‘Liz Truss exit sets off another Tory leadership race’, 20 October 2022, Link
[3] Hansard, ‘Opposition Day Debate: Ban on Fracking for Shale Gas Bill ’, 19 October 2022, Link
[4] The Guardian, ‘A day of Conservative chaos in Westminster – how it unfolded’, 20 October 2022, Link
[5] Prime Minister’s Office, 10 Downing Street, ‘Exchange of letters between Kwasi Kwarteng and the Prime Minister’, 14 October 2022, Link
[6] HM Treasury, ‘Chancellor brings forward further Medium-Term Fiscal Plan measures’, 17 October 2022, Link
[7] Sky News, ‘Chancellor Jeremy Hunt warns ‘nothing off table’ on tax cuts as senior Tory says government behaving like ‘libertarian jihadists’’, 16 October 2022, Link
