Chosen by us to get you up to speed at a glance
Jeremy Hunt has appeared to reject a claim made by his predecessor Kwasi Kwarteng that the short-lived Truss administration cannot be blamed for the UK’s economic difficulties.
Mr Kwarteng told TalkTV in an interview published last night: "The only thing that they could possibly [blame us for] is the interest rates but interest rates have come down, the gilt rates have come down.
"The black hole and the structural problems were already there.. the national debt wasn’t created by Liz Truss’s 44 days in government."
Asked directly by broadcasters about Mr Kwarteng’s comments, Mr Hunt said: "Well, all I would say is that when we produced a fiscal statement that didn’t show how we were going to bring our debts down over the medium term, the markets reacted very badly and so we have learned that you can’t fund either spending or borrowing without showing how you are going to pay for it and that is what I will do."
The comments highlight the tensions within the Conservative Party as Mr Hunt prepares to deliver an Autumn Statement on November 17 which will set out tax rises and public spending cuts.
The Chancellor today confirmed there is a sizeable black hole in the nation’s books as he said there is a "very substantial gap in our national finances". The black hole has been estimated at up to £60billion.
Follow live updates below.
Thank you for joining me for today’s politics live blog.
I will be back early on Monday morning.
Rishi Sunak and Jeremy Hunt met with the leaders of the B5 Business Group in Downing Street today ahead of next week’s Autumn Statement.
The B5 consists of the British Chambers of Commerce, the Confederation of British Industry, the Federation of Small Businesses, the Institute of Directors and Make UK.
The Transport Secretary has offered to meet trade union leaders amid growing speculation that ministers will back down in the face of rail strikes that have cost the economy half a billion pounds.
Mark Harper, who replaced Anne-Marie Trevelyan last month, has written to the RMT, Aslef and the TSSA as part of efforts to bring the chaos to an end.
You can read the full story here.
A close ally of Liz Truss has accused Kwasi Kwarteng of “rewriting history” after he warned her of going too fast with her disastrous economic plans.
The former chancellor said on Thursday night that he had told Ms Truss to “slow down” after September’s mini-Budget – and said it was “mad” to fire him.
But an ally of the ex-prime minister hit back this morning, saying the pair had been in “lockstep”.
“There’s a lot of rewriting history being done,” the ally said. “Liz and Kwasi were in lockstep on the mini-Budget.”
You can read the full story here.
Michael Gove has said levelling up is "tougher but also much more vital" in the current economic circumstances.
The Levelling Up Secretary told a press conference at the British-Irish Council summit in Blackpool: "Inflation does mean that that does become more difficult but it also means that it becomes more necessary because inflation bears disproportionately harshly on the poorest in our society…
"So yes, tougher but also much more vital."
Irish Taoiseach Micheal Martin has said he agreed with Rishi Sunak that Northern Ireland Protocol concerns should be resolved "as soon as possible".
Asked how long the "window of opportunity" is to address the concerns, he told a press conference at the British-Irish Council summit in Blackpool: "I’m reluctant to put a specific timeline on this, but there is a significant window of opportunity.
"And the timeline really – both the Prime Minister and I were very clear about this last evening – as soon as possible.
"The sooner we can resolve this, the sooner negotiations can bring a resolution to this, the better, because both of us want the institutions back up and running as quickly as possible."
Downing Street has just issued a readout following Rishi Sunak’s meeting with Jordan’s King Abdullah II (see the post below at 09.44).
A No10 spokesman said: "The Prime Minister was pleased to have the opportunity to meet His Majesty the King early on in his premiership, given the importance and historic significance of the UK-Jordan relationship.
"They discussed regional security, including developments in Iraq and Syria and challenges posed by climate change and energy security. Both leaders reiterated their shared commitment to peace and stability in the Middle East.
"The Prime Minister and King Abdullah also welcomed opportunities to deepen cooperation on trade and investment, including new solar and wind power projects and sustainable infrastructure development."
Micheal Martin, the Irish Taoiseach, has said the relationship between Dublin and London has "improved very significantly" in recent weeks since Rishi Sunak took over in Downing Street.
He told a press conference at the British-Irish Council summit: "I think the relationship, certainly between the Prime Minister and I and both governments, has improved very significantly.
"And I think we’re both of a mind to – with our colleagues in the European Union – to get this issue resolved in a harmonious way. And I think the meeting over these two days has again reinforced the importance of all of us working together on shared challenges and shared issues.
"So therefore, the need to really get this issue resolved is important because we have other bigger issues also. Really significant economic challenges coming our way, we have the war in Ukraine."
The Irish Taoiseach said he believes there is now a "window of opportunity" for the UK and the EU to agree a deal to improve the Northern Ireland Protocol.
Speaking at a press conference at the end of the British-Irish Council, Micheal Martin said: "I think the essential point is that a window of opportunity has been created with the pausing of the elections and the engagement between the United Kingdom Government and the European Union in respect of talks and a clear preference articulated by the UK Prime Minister and the European Union leadership, the preference for a negotiated resolution of this.
"It is my assessment that the window of opportunity now does exist. The space now exists to resolve the outstanding issues pertaining to the Protocol by negotiation.
"Obviously that will need momentum, it will need substantive engagement by the EU and UK Government to make that a reality. But I must say I was, I takeaway a positive perspective from last evening’s meeting with the Prime Minister Rishi Sunak."
Michael Gove, the Levelling Up Secretary, said the Government is "optimistic" about agreeing a solution with the EU on the Northern Ireland Protocol.
Speaking at a press conference at the end of the British-Irish Council in Blackpool, Mr Gove said he is "not aware of any plans to pause consideration of the protocol bill" in reference to the Northern Ireland Protocol Bill which is currently making its way through the House of Lords.
He said that Rishi Sunak’s discussions with the Irish Taoiseach Micheal Martin yesterday on finding a "safe landing zone" were done in a "cordial and constructive fashion".
He said he is "optimistic about the opportunities of reaching a resolution" on post-Brexit border rules.
Tax rises and public cuts are "not necessary" at the Autumn Statement, a think tank has argued.
The National Institute of Economic and Social Research said expected tax hikes on November 17 "may further damage the country’s already anaemic growth prospects".
Professor Stephen Millard, the NIESR’s deputy director for macroeconomics, said: "With the economy still reeling from the effects of the terrible Russian invasion of Ukraine and the Monetary Policy Committee raising interest rates to bear down on inflation, now is not the time to be tightening fiscal policy.
"In fact, given that existing announcements have already restored stability to the financial markets and high inflation continues to benefit the overall fiscal position, it’s not at all clear that the Chancellor needs to raise taxes or cut spending in the Autumn Statement next week. It just doesn’t have to be this way."
Inflation will peak at 11 per cent in January next year before slowly falling to 5.7 per cent by the end of 2023, according to a forecast published by the National Institute of Economic and Social Research.
The think tank has predicted that inflation will only fall below the Bank of England’s target of two per cent in the second half of 2025. CPI was 10.1 per cent in September this year.
It said: "The Energy Price Guarantee (EPG) has lowered the peak in CPI inflation, which we now expect to be 11 per cent in January 2023. Nonetheless, we think inflation is likely to be more persistent than previously forecasted, only falling to 5.7 per cent by the end of 2023 and not reaching the Bank of England’s target of 2 per cent until the third quarter of 2025."
NIESR also said that it expects "average earnings to grow at 5.7 per cent in 2023, 4.4 per cent in 2024 and 2.3 per cent in 2025".
"However, given this is not keeping pace with inflation, we predict that real wages will continue to fall until late 2023," it said.
The Government’s Northern Ireland Protocol Bill is "not helpful" and if it does become law it will change relations between the UK and EU "considerably", Joao Vale De Almeida has said.
The outgoing EU ambassador to the UK said Brussels would like to see the draft legislation dropped. The bill, which is currently making its way through the House of Lords, would give ministers the power to unilaterally make changes to post-Brexit border rules in Northern Ireland.
Mr Vale De Almedia told Times Radio: "It’s an understatement to say that this is not helpful… we think it’s not lawful. It’s illegal in terms of the respect of an international treaty.
"We accepted to talk even if the bill goes through Parliament, but one should be very clear if ever the bill becomes law, the situation changes considerably."
The EU’s proposals to improve post-Brexit border rules in Northern Ireland are not yet "fully exhausted", the bloc’s outgoing ambassador to the UK has said.
But Joao Vale De Almeida also said "there will always have to be a degree of checks" in the Irish Sea.
He told Times Radio: "We have shown flexibility and I’ve been saying and I repeat here this morning, our offer is not yet fully exhausted.
"So there is room within what we put forward in the last few months as in a flexible pragmatic way to address some of the difficulties that we have encountered in implementing the agreement.
"But let me be clear about one point. There will always have to be a degree of checks at the border, because we need to protect half a billion people in the internal market in order to continue to allow Northern Ireland to have access to both markets."
The outgoing EU ambassador to the UK said there has been a "change of tone" in the relationship between Britain and Brussels since Rishi Sunak moved into No10.
Joao Vale De Almeida told Times Radio: "What I see is a change of tone, a change of mood music if you want. I think we still miss the lyrics of the new British song, particularly on the Northern Ireland Protocol…"
He added: "We have Brexit, we respect Brexit. But we believe that in spite of Brexit, provided we restore trust among our countries, we can move forward."
Joao Vale De Almeida, the outgoing EU ambassador to the UK, said he believes Britain and Brussels are now on the path to agreeing a deal on the Northern Ireland Protocol.
He likened the current situation to a "plane on the tarmac ready to take off" as he said the "engines are warming up".
Speaking to Times Radio, he said: "I’m leaving on a high tone, let’s put it this way, I leave behind the prospect of positive news.
"I think it’s like if you have a plane on the tarmac ready to take off, I think the engines are warming up. I hope it will take off very soon.
"I think the conditions are better today for that and I am encouraged by what I hear from the Prime Minister, from the Foreign Secretary. We are holding technical talks, I hope that very soon we can step up and try to address the core issues that need to be solved."
The Autumn Statement is now less than a week away and Westminster is braced for Jeremy Hunt to announce a range of tax rises and public spending cuts.
A report today suggested the approach which the Chancellor intends to take on the latter is likely to leave the Government open to accusations of a return to austerity.
The Times reported that Mr Hunt is planning to slow planned increases in spending beyond 2025 as he tries to save cash and balance the books.
Spending is currently pencilled in to rise by 3.7 per cent annually after that date but it is thought Mr Hunt could reduce that to as little as one per cent.
Such a rise would likely be lower than the rate of inflation which would mean some departments facing real terms cuts to budgets.
People should not be shamed into wearing poppies in the days leading up to Remembrance Sunday, the minister for the Armed Forces has said.
James Heappey, a former officer in the Rifles who served in Afghanistan, said he would rather fewer people wore poppies if they understood what they symbolised than everyone was forced to wear one because "Twitter went nuts if you didn’t".
Mr Heappey made the comments during an appearance on Chopper’s Politics Podcast. You can listen to this week’s episode here.
Today and forever, we will remember them. pic.twitter.com/eifs3UEcAE
Treasury briefings say they need to clobber us with more taxes to cut demand. Meanwhile in the real world we worry about the approaching recession. Why does the Treasury drive by looking in the rear view mirror instead of seeing they are steering us into a downturn?
The British Chambers of Commerce has warned that "business confidence has fallen significantly in recent months" as it responded to today’s GDP figures.
David Bharier, head of research at the BCC, said: "Today’s figures, showing a 0.2 per cent fall in the quarterly estimate for Q3 GDP, as well as a 0.6 per cent fall in monthly GDP, solidify the picture that the economy is moving towards recession, if not already in one.
"Worryingly, the figures show a decline across all 13 manufacturing sectors tracked by the ONS, with production output overall shrinking by 1.5 per cent. Services as a whole have seen no growth in the quarter.
"Our research clearly shows that business confidence has fallen significantly in recent months. Inflation, driven by energy costs and supply chain disruption, is by far and away the top factor of concern, wiping out margins for many SMEs.
"With the Bank of England now forecasting a two-year recession, monetary and fiscal policy need to align to prevent stagflation."
Jeremy Hunt is plotting a stealth tax raid on small businesses that will force thousands more to pay VAT as he scrambles to balance the country’s books.
The Chancellor is preparing to hold the threshold at which businesses must register to pay VAT at £85,000 of turnover until 2026, instead of raising it in line with inflation.
The plans mean that thousands more businesses will pay the tax for the first time as their turnover increases in line with rising prices.
That threshold has already been frozen until 2024, but Mr Hunt and Rishi Sunak, the Prime Minister, are considering extending this by another two years.
You can read the full story here.
Alison McGovern, Labour’s shadow employment minister, was asked if a Labour government would agree to the Royal College of Nursing’s request for a 17.6 per cent pay rise. She refused to be drawn.
She told Sky News: "Let’s see what the Government have to say. I think that… our NHS staff are in a terrible position and I think that people are right to be, nurses are right, to point out the situation that they have over pay.
"From opposition we don’t have access to all of the information that the Government do, especially given that they failed to bring forward the true picture of the UK’s finances.
"But I know that for any Labour government prioritising investment in our public services, including in pay, will be a priority."
Alison McGovern, Labour’s shadow employment minister, said the UK needs a "whole new approach" to the economy.
She told Sky News: "We know that we need a whole new approach. The past 12 years have seen Conservatives consistently take the wrong decisions and I think it is time for a change on our economic policy."
Jeremy Hunt has appeared to reject suggestions by Kwasi Kwarteng that the state of the UK finances cannot be blamed on the short-lived Truss administration.
Asked directly by broadcasters about his predecessor’s comments on the so-called "fiscal black hole", the Chancellor said: "Well, all I would say is that when we produced a fiscal statement that didn’t show how we were going to bring our debts down over the medium term, the markets reacted very badly and so we have learned that you can’t fund either spending or borrowing without showing how you are going to pay for it and that is what I will do."
Mr Kwarteng told TalkTV in an interview published last night: "The only thing that they could possibly [blame us for] is the interest rates but interest rates have come down, the gilt rates have come down.
"The black hole and the structural problems were already there.. the national debt wasn’t created by Liz Truss’s 44 days in government."
You can read the full story on Mr Kwarteng’s comments here.
Labour’s shadow employment minister Alison McGovern accused the Tories of causing "ridiculous levels of turbulence" in the economy as she said voters will not forget it.
Speaking to Sky News, she said: "For many families in our country today’s GDP figures will feel like a statement of the bleedin’ obvious, that they have been struggling to deal with rising prices and an economic situation that has been very challenging for some time.
"I don’t think anybody in the country will be surprised by this at all. I think that Jeremy Hunt, sort of, needs to recognise the ridiculous levels of turbulence that we have seen since September have come from the Conservative Party and I don’t think anyone will forget that Liz Truss Kwasi Kwarteng in their absolutely crazy Budget in September caused an economic damage to families that was profound, on top of the global difficulties that we are facing.
"I would simply say to Jeremy Hunt, you say that around a third of countries are facing these difficulties, well why are we in that third? Why are we not doing better?"
Sarah Olney, the Liberal Democrats’ Treasury spokeswoman, said voters will "never forgive" the Conservative Party for the economic decisions it has taken in recent months as she responded to today’s GDP figures.
She said: "Today’s figures show the Conservative Government is leaving our economy smaller and all of us poorer.
"People will never forgive this Government for crashing our economy during a cost-of-living crisis and putting up their mortgages by hundreds of pounds a month. The Conservative party can never again claim that they are the party of sound money.
"Ministers must now do whatever it takes to protect households from the economic downturn they have caused, starting with a mortgage protection fund to ensure nobody loses their home this winter."
Rachel Reeves, Labour’s shadow chancellor, described today’s GDP figures as "another page of failure in the Tories’ record on growth".
She said: "And the reality of this failure is family finances crunched, British businesses left behind and more anxiety for the future.
"Britain’s unique exposure to economic shocks has been down to a Conservative led decade of weak growth, low productivity and underinvestment and widening inequality. We’re already set to be near the bottom of global league tables on growth, but all the Tories offer yet again is austerity.
"Britain has so much potential to grow. We have the talent. We have the capacity. Labour’s Green Prosperity Plan, our modern Industrial Strategy, our plan to boost skills and our active partnership with business will get our economy firing on all cylinders."
NEW: GDP figures show UK economy shrank by 0.2% in the third quarter.
This is extremely worrying – and is another page of failure in the Tories' record.
Britain has so much potential to grow.
Labour's Green Prosperity Plan and our partnership with business will unlock that.
Jeremy Hunt was asked if he is concerned that the UK could be facing a "winter of discontent" amid growing public sector threats of strike action. He was also asked specifically about nurses seeking a 17.6 per cent pay rise.
The Chancellor said: "Well, nurses are working incredibly hard, as is everyone on the NHS frontline. It is an area that I know well and I have a great deal of sympathy for them and the reason they are feeling so frustrated is because inflation is more than 10 per cent and that is eating away at everyone’s earnings and making everyone worry about the cost of the weekly shop.
"The best thing that I can do as Chancellor is produce a plan that brings down inflation, brings down the upward pressure on interest rates that also means that those nurses are having to pay more for their mortgages every month.
"What we need is to put that plan in place. It is not going to be easy, there are going to be some very difficult choices. I have used the word eye-watering before and that is the truth.
"But we are going to make those choices to give nurses, public sector workers, actually all families and businesses who are worrying at the moment, that certainty that there is a plan in place."
The UK must give "certainty to the world" that it is a country that "pays our way" if it is to reduce inflation and bring down interest rates, Jeremy Hunt has argued.
The Chancellor told broadcasters: "There is some choice over the rules, what are called the fiscal rules, that you choose to follow and there is also uncertainty in any projections.
"But there isn’t uncertainty about a basic choice we make as a country which is whether we are going to pay our way and if we don’t give that certainty to the world what we will see is higher interest rates, higher inflation, more instability and more worries for families and businesses.
"That is why it is so important to show the world that we are a country that pays our way."
Jeremy Hunt has confirmed there is a sizeable blackhole in the nation’s books as he said there is a "very substantial gap in our national finances".
However, he insisted the UK is not the only country facing such a situation.
Asked if there is a blackhole in the public finances, the Chancellor said: "If we are going to bring down debt over the medium term and give people confidence that we are paying our way as a country then yes, there is a very substantial gap in our national finances and not just us.
"Germany has announced that they are controlling their borrowing. Italy has done the same. The United States is raising taxes by $800billion to bring down inflation. So these are global factors, partly because of what is happening in Ukraine, partly because of the pandemic, that all of us are having to come to terms with and the sooner we do that, the quicker we can give families and businesses hope that there is a way through the very difficult challenges we face."
Jeremy Hunt said that if the UK does sink into a recession then his job will be to make the downturn as "shallow" and "quick" as possible.
The Chancellor was asked if he was alarmed that the UK is the only G7 economy which is shrinking at the moment.
He said: "Well, according to the International Monetary Fund, around a third of the world’s economy is in recession this year or will be in recession next year and that is principally but not entirely because of very high global energy prices.
"We are not immune to that in the UK and what we need is a plan that shows how we are going to get through this difficult period, if it is a recession, how we make it shallower and quicker so that we can protect businesses who are really struggling as these figures show but also give families some hope that we will get through to the other side with the most vulnerable people protected."
Jeremy Hunt has just spoken to broadcasters in Downing Street as he responded to the GDP numbers (See the post below at 07.41).
The Chancellor was asked if it is now inevitable that the UK is in recession.
He said: "Well, the Bank of England says that we are likely to be in recession. This is disappointing but not entirely unexpected news and what we need to do now is present a plan to the country to tackle the root cause of the issues we face which is inflation and a plan that protects the most vulnerable and that is what I must do next Thursday."
Jeremy Hunt, the Chancellor, said there is a "tough road ahead" for the UK as he responded to this morning’s GDP statistics (see the post below at 07.41).
Mr Hunt said the economic situation will require him to make "extremely difficult decisions" at the Autumn Statement on November 17.
Here is the Chancellor’s statement in full:
"We are not immune from the global challenge of high inflation and slow growth largely driven by Putin’s illegal war in Ukraine and his weaponisation of gas supplies.
"I am under no illusion that there is a tough road ahead – one which will require extremely difficult decisions to restore confidence and economic stability. But to achieve long-term, sustainable growth, we need to grip inflation, balance the books and get debt falling. There is no other way.
"While the world economy faces extreme turbulence, the fundamental resilience of the British economy is cause for optimism in the long run."
The UK economy shrank by 0.2 per cent in the third quarter of 2022, according to numbers published this morning by the Office for National Statistics.
The figure for July to September will spark fears that the UK is sliding towards a recession – something that will be confirmed if the economy also shrinks in the final quarter between October and December.
The ONS figures also revealed that GDP fell by 0.6 per cent in September alone. However this was affected by the bank holiday for the State Funeral of Her Majesty Queen Elizabeth II as some businesses closed or changed their opening hours on this day.
Good morning and welcome to today’s politics live blog.
The Office for National Statistics has just published the latest numbers on the state of the economy – it is not good news – and Jeremy Hunt has been quick out of the blocks to respond to them.
The numbers are likely to increase the pressure on the Chancellor as he prepares to deliver the Autumn Statement on November 17.
Let’s start by looking at the numbers themselves and then we can dive into the political reaction.
We rely on advertising to help fund our award-winning journalism.
We urge you to turn off your ad blocker for The Telegraph website so that you can continue to access our quality content in the future.
Thank you for your support.
Need help?
Visit our adblocking instructions page.