Government to outline tax cuts debt plan earlier than expected

Kwasi Kwarteng has had a difficult start in his role as Chancellor and made his first conference speech a more muted affair, ITV News Politics Editor Robert Peston

The government is set to bring forward the publication of its debt plan amid questions over how it plans to pay for sweeping tax cuts, ITV News understands.

Prime Minister Liz Truss and Chancellor Kwasi Kwarteng have faced pressure to outline the details of their plan, in a bid to calm markets recoiling from their 'mini-budget'.

Earlier, Mr Kwarteng performed a U-turn on plans to abolish the top income tax rate for higher earners.

In key marginals around Birmingham, the government's mini-budget has not been popular ITV Political Correspondent Shehab Khan reports

The Truss government had faced criticism over its plan to end the 45% additional tax rate for workers earning more than £150,000.

The Financial Times reported earlier that the Chancellor will publish his medium-term fiscal plan, alongside official forecasts from the Office for Budget Responsibility, later this month.

Mr Kwarteng had previously insisted he would wait until November 23.

An official date has not been released for an earlier publication.

However, in his speech to the Tory conference in Birmingham on Monday, Mr Kwarteng did say he would publish details "shortly" on how he planned to bring down public debt as a percentage of GDP over the medium term.

The chancellor earlier described the market turmoil that triggered his astonishing U-turn on income tax cuts for the highest earners as a "little turbulence" as he battled to regain authority.

The chancellor remarked it had been a "tough" day as he told Conservative members in his set-piece conference speech on Monday to "focus on the task in hand".

Downing Street was forced to reassure that Liz Truss still backs Mr Kwarteng after they abandoned their plan to scrap the 45% rate, in a bid to stave off a Tory revolt.

The climb-down came a little over a week after the tax cut was announced in the mini-budget and just a month into Ms Truss’s premiership.

Mr Kwarteng tried to strike an upbeat tone about the merits of the mini-budget during his conference speech.

The public did not have many kind words about the government's first few weeks in government, Shehab Khan reports

He said: "Our growth plan set out 10 days ago will ensure we focus relentlessly on economic growth. Because we must face up to the fact that for too long, our economy has not grown enough.

"The path ahead of us was one of slow, managed decline.

"But I refuse to accept that it is somehow Britain’s destiny to fall back into middle league status or that the tax burden reaching a 70-year high is somehow inevitable. It isn’t and it shouldn’t be."

Commenting on reports the chancellor will agree to calls from the Treasury Committee and bring forward the date of the Autumn Fiscal Plan to October, the committee's chair, Conservative MP Mel Stride, said: "I have pressed the Chancellor very hard on this and to his credit he has listened.

"Provided the OBR forecast and new fiscal targets provide reassurance then bringing these forward should calm markets more quickly and reduce the upward pressure on interest rates to the benefit of millions of people up and down the country. 

"In particular getting the forecast out ahead of the MPC meeting on 3rd November might help to reassure our rate setters that they can go with a smaller base rate increase than would otherwise be the case."

Responding to reports the debt plan publication will be unveiled earlier than expected, Labour's shadow chancellor Rachel Reeves said: “This is a Tory economic crisis, made in Downing Street and paid for by working people. 

“The Chancellor’s refusal to make public the OBR reports that could provide clarity to markets and reassurance to the British people is misguided and harmful.

“They must publish the OBR forecasts and details of their plans now, and continued failure to do so suggests the government has something to hide, further undermining confidence in the UK as a safe place to invest.

“The scale of the government’s chaos has shown once and for all that Labour is the party of fiscal responsibility and social justice."

The government's mini-budget caused chaos in the bond markets last week as investors viewed the unfunded tax cuts at a time of increased borrowing as a risky move, sending the cost of debt spiralling.

The move to bring forward the debt plan and involve the OBR will be seen as a move to calm investors who were on edge after a turbulent week.

The pound surged higher in overnight trading on Monday as reports emerged that the government was preparing to U-turn.

Sterling hit 1.12 US dollars, recovering to levels seen before the mini-budget.

But banks continued to hike interest rates on mortgage deals on Monday, sparking criticism of Ms Truss' government from across the political divide.

Local Labour MP Jess Phillips said the Tories still had a lot to answer for when it came to rising mortgage prices

The government is still facing difficulty with its backbenchers, with former Cabinet minister Nadine Dorries saying on Monday there was "widespread dismay” at Ms Truss for ditching key parts of Boris Johnson’s administration’s agenda. She suggested the Prime Minister should call an election.Ms Dorries, who supported Ms Truss's leadership campaign, said: "If Liz wants a whole new mandate, she must take it to the country."Backbench MP Johnny Mercer heaped criticism on the administration in a Facebook post, writing: "It is hard watching these rather comedic figures masquerading as government ministers sprawling around the media.

"Last week my friend had to close his coffee shop. Another had his mortgage pulled. It is deeply unfunny for normal people."

Fellow Tory MP Huw Merriman apologised to his constituents for the turmoil caused by the mini-budget.

In an email to constituents, Merriman said the budget was "not a plan I voted for", and as a Conservative MP it "would be wrong of me not to say that I am extremely sorry for the impact it has had."

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