Northern Powerhouse Rail under threat from cuts, Hunt suggests

The Chancellor has suggested that Northern Powerhouse Rail may not be delivered in full, as he tore up Liz Truss’ spending pledges and tax cuts.

Jeremy Hunt, in his first working day in the job following the sacking of Kwasi Kwarteng, reversed the Prime Minister’s economic vision during a statement in Parliament.

When asked whether infrastructure projects such as Northern Powerhouse Rail, a key campaign pledge of the Prime Minister, could be scaled back, Mr Hunt said that all options were in play in his attempt to balance the books.

“There are very important projects that we all care about a great deal, but given the severity of the situation at the moment we are not taking anything off the table, whether tax increases or spending reductions,” he said.

It came only hours after the Prime Minister’s official spokesman suggested that there were no plans to cut infrastructure spending or investment zones as part of the new economic agenda.

In response, Kevin Hollinrake, the Tory MP for Thirsk and Malton said: “I can understand that the Chancellor needs time to consider where savings can be made, but it would be a hugely false economy not to invest in vital regional projects such as Northern Powerhouse Rail and

I will vigorously pursue a renewed commitment to it.

It came as part of a package of measures which saw the new Chancellor to “indefinitely” stop the proposed cut to the basic rate of income tax to 19p.

Planned cuts to fuel duty were also shelved, with the British Beer and Pub Association calling the move “a huge blow” to an industry already on its knees.

The most expensive measure in the original budget was also significantly scaled back, with the two-year freeze on energy bills reduced to only six months, leaving families set to face thousands of pounds more in costs, unless further assistance is given following a Treasury review of the scheme.

The Resolution Foundation think tank said that the reversal of 60 per cent of the tax cuts will now see the typical household lose around £1,000 due to personal tax cuts and benefit changes, some £220 more than when the fiscal plan was announced.

In his televised statement yesterday morning, the Chancellor said departments will also have to redouble their efforts to find savings, with further cuts set to be announced this month.

Liz Truss was largely absent from the Commons, with Penny Mordaunt, a cabinet minister and leadership rival, stepping in to answer questions from Sir Keir Starmer during an emergency debate, and was forced to deny that the Prime Minister was “hiding under a table” rather than addressing MPs.

Last night it was reported that Ms Truss was meeting Graham Brady, chairman of the 1922 committee, following suggestions that more than 100 letters of no confidence had been submitted against her.

Senior Tory backbencher Sir Charles Walker became the fifth Conservative MP to publicly call on her to resign as Prime Minister, saying that her position is “untenable” following a series of errors.

The latest blow to her credibility and mandate came as new polling showed that Labour now has a staggering 36-point lead over the Conservatives, with 56 per cent of the vote, compared to only 20 per cent for the Conservatives.