'Absolutely no plans to change anything', insists minister, as Kwarteng flies home early from Washington

14 October 2022, 08:27

The government has "absolutely no plans to change anything" in its controversial economic plan, a minister has said - despite reports of more u-turns to come, and chancellor Kwasi Kwarteng flying home early from a trip to Washington D.C.

Trade minister Greg Hands told Nick Ferrari on LBC on Friday that "the government and the prime minister are absolutely determined to stick to the growth plan, to stick to the changes they outlined.

He added that there are "absolutely no plans to change anything".

Mr Hands' comments came despite reports that the government is considering increasing corporation tax, despite the PM centring her leadership campaign around cancelling Rishi Sunak’s planned rise of the rate.

Downing Street on Thursday did not deny that the potential exists for a reversal on the corporation tax policy.

It came amid reports that talks were under way between No 10 and the Treasury on abandoning elements of the £43 billion tax-cutting plan.

Speculation was fuelled further when Mr Kwarteng only said "let's see" when asked about the expectation from financial markets that the Government could ditch its corporation tax promise.

But despite the talk of u-turns and the economic turmoil rocking the UK, Mr Kwarteng is "totally" safe in his position as chancellor of the exchequer, Mr Hands said.

Penny Mordaunt to step in as PM

He said that Liz Truss has "total confidence" in Mr Kwarteng, despite the Prime Minister reportedly preparing to u-turn on her mini-Budget in a bid to stave off a Tory leadership plot.

Asked if Mr Kwarteng's position on Sky News, Mr Hands said on Friday: "Totally. I mean, Kwasi Kwarteng himself said yesterday he is 100% sure he will still be in position. I know the Prime Minister has got total confidence in Kwasi Kwarteng."

He added that Mr Kwarteng is "an incredibly capable person, a very, very bright person who makes good judgment calls".

And the trade minister added that he did not "recognise" reports that senior Conservative MPs were planning to install Penny Mordaunt and Mr Sunak to replace Ms Truss and Mr Kwarteng.

Mr Kwarteng is flying back a day early from talks with the International Monetary Fund (IMF) and World Bank - but Mr Hands said this was nothing out of the ordinary.

He told LBC: "He has been there two days, I’ve been a government minister most of the last 11 years, and it’s not unusual to come back as a government minister a day early."

No change in plans for corporation tax

When asked if there will be any more U-turns on the mini-budget, Mr Hands said "let's wait and see".

He said on Sky: "You won't have long to wait for the 31st of October for the Chancellor to lay out those plans. I do say that the Prime Minister and the Chancellor are absolutely resolute, determined.

"The growth plan (is) the centrepiece, but we'll have to see some of the detail including a full forecast from the Office for Budget Responsibility on the 31st of October."

Downing Street on Thursday did not deny that the potential exists for a reversal on the corporation tax policy, one of the landmark promises made by Ms Truss in her pitch to become Tory leader.

Read more: King Charles mutters 'dear oh dear' to under-fire Liz Truss as pair meet for weekly audience

Read more: Kwarteng insists no more mini-budget u-turns despite claims government ‘may raise corporation tax’

Despite Mr Kwarteng and Mr Hands' insistences that nothing is set to change, discussions are believed to be under way to replace Ms Truss with a "unity candidate".

One senior Tory told The Times: “A coronation won’t be that hard to arrange. In 2019 candidates needed eight MPs to get on the ballot paper. This year they needed 20.

"Next time it will be however high it needs to be for only one candidate to clear it."

They predicted a pact between Mr Sunak and Ms Mordaunt, which would have the support of an overwhelming majority of Conservative MPs.

Around "20 to 30" former ministers and senior backbenchers are attempting to find a way for a "council of elders" to tell Truss to step down, it is understood.

Another MP told the paper: "Rishi’s people, Penny’s people and the sensible Truss supporters who realise she’s a disaster just need to sit down together and work out who the unity candidate is.

"It’s either Rishi as Prime Minister with Penny as his deputy and Foreign Secretary, or Penny as Prime Minister with Rishi as Chancellor.

"They would promise to lead a government of all the talents and most MPs would fall in behind that."