In yet another chaotic and tumultuous day at Downing Street, more akin to a political satire than the functioning governance of a major global economy, U.K. Prime Minister Liz Truss announced a raft of u-turns on her first economic plan, sacked her Chancellor Kwasi Kwarteng, and replaced him with former leadership contender and prominent Remainer Jeremy Hunt.
The writing appeared to be on the wall for Kwarteng after he abruptly left meetings with global financial leaders in Washington on Thursday evening to fly back to Westminster for crunch talks with Truss, only to realize upon landing that the prime minister and her closest allies had already agreed upon changes to his proposed economic plan and settled upon his dismissal from the Treasury.
The government had been under pressure by the media, financial markets, and political opposition to reverse a range of tax cuts announced in what has been referred to as a mini-budget revealed by Kwarteng on Sept. 23.
Kwarteng was confirmed to be for the chop shortly after touching down at London Heathrow. In a statement posted on his social media accounts, Kwarteng revealed he had indeed been sacked, writing: “You have asked me to stand aside as your Chancellor. I have accepted.” He expressed his ongoing support for the prime minister.
However, there was confusion with Truss’ response to her long-time ally’s letter, in which she stated she “deeply respects” his decision to step down. To make matters worse, the prime minister’s letter to her friend ‘Kwasi’ was signed off by ‘Kwasi Kwarteng,’ rather than Liz Truss, further evidence of the chaotic and fast-moving events unfolding in Westminster on Friday.
Within half an hour of Kwarteng’s ousting, mainstream media outlets were reporting that former leadership candidate and fellow Remainer Jeremy Hunt would be replacing the former chancellor.
Hunt becomes the fourth U.K. chancellor since July last year.
During the Conservative leadership campaign in the summer, Hunt actually advocated for the most aggressive tax cuts of any contender and proposed slashing the corporate tax rate from 19 percent to 15 percent. Now, he will be required to raise the tax from 19 percent to 25 percent, after Truss confirmed in a press conference on Friday afternoon that her plan to reverse a rise in the corporate tax outlined by her predecessor Boris Johnson’s administration was in fact going to be reversed itself.
Truss justified her reversal by claiming that it was clear her initial economic plan had gone “further and faster than markets were expecting.”
During the press conference, ITV’s political editor Robert Peston put it to Truss that former Conservative Chancellor Philip Hammond had said Truss has “totally trashed the Tory Party’s election winning reputation for economic competence.”
The embarrassing u-turns which have seen the governing Conservative party plummet to historic lows in opinion polls has seen some of its supporters demand a change in strategy.
Influential donor Lord Cruddas wrote in the Telegraph newspaper on Friday that it was time to “bring back Boris,” as he urged the “idiots who ousted” him to “repent,” and insisted “Boris was and still is the Conservative Party’s only hope.”
