Truss and Kwarteng face the heat amid talks of another ‘mini-Budget’ U-turn

It is hard to believe that the ‘mini-Budget’ – which has turned out to in fact be a pretty large event, triggering widespread economic turmoil – is only three weeks old today. The statement tanked the pound, saw mortgage rates rise sharply, threatened to collapse pension funds and handed Labour a 33-point lead in the polls. Both Liz Truss and Kwasi Kwarteng are under significant pressure – from within their own party and beyond.

The Chancellor and Prime Minister are now expected to make a further U-turn on their fiscal plans after Kwarteng cut short a trip to the US and dashed back to London overnight. The Treasury insisted that the Chancellor rushing home for urgent talks in Downing Street does not mean that another significant reversal is on the cards – but Kwarteng has not denied that the government is considering raising corporation tax from 19% to 25%, a commitment previously made by Rishi Sunak and one Kwarteng pledged to axe in the mini-Budget. Asked whether such a U-turn is in the offing, the Chancellor said “let’s see”.

Junior trade minister Greg Hands told Sky News this morning that Truss and Kwarteng are “determined and resolute” to deliver their economic growth plan and urged people to wait and see what happens on October 31st, when the Chancellor is due to deliver his medium-term Budget plan. Whether Kwarteng will make it to that date is in serious doubt, however, as many expect that a further U-turn on another central plank of the plan announced less than a month ago could mean the end for the Tories’ third Chancellor this year.

Rebellious Conservative backbenchers are also openly discussing replacing Truss, of course, after just six weeks in the job. Normally, the Tory Party rules mean that only one leadership contest can be held in any 12-month period – which should mean that Truss is safe for a year. There is widespread talk, however, that the 1922 committee – which determines the party’s rules – could change them in response to the rapid and escalating outcry caused by the new Prime Minister in her short but explosive tenure.

The prospect of another Conservative leadership election is not one many would look forward to. And, given that the Tory membership voted only six weeks ago to put a new Prime Minister in place, it gives credence to Ed Miliband’s comments this morning: that the only way to end the current political turmoil is for the Conservatives to “get out of the way” for Labour. Sign up to LabourList’s morning email for everything Labour, every weekday morning.