Truss and Kwarteng seek to heal divided party as Parliament returns

Yesterday the Prime Minister struck a more conciliatory tone with her backbenchers, following a week which saw threats of deselection for those that didn’t back her economic vision.

She is this week expected to hold policy lunches with groups of MPs as well as address the 1922 Committee of Tory backbenchers as she faces rebellions in multiple areas, such as government borrowing, benefits, and international aid.

The Prime Minister yesterday appointed Greg Hands, a prominent backer of Rishi Sunak, to her government in an apparent peace-offering for those agitating for her departure, as she replaced the sacked trade minister Conor Burns.

It came as Mel Stride, the senior Conservative who chairs the Treasury select committee, who has been vocally opposed to the Chancellor’s economic plan, revealed that Kwasi Kwarteng has bent to political pressure and moved his medium term fiscal plan to Halloween.

Moving the effective second mini budget from 23 November was strongly welcomed by Mr Stride, saying the documents may result in a smaller rise in interest rates which is “critical to millions” of mortgage holders.

Grant Shapps, the former transport secretary who was sacked by Liz Truss, and has now become one of her strongest critics from the backbenches, said that it was a “belated but sensible move”.

Ms Truss and Mr Kwarteng also took further steps to show that they were in “listening mode” as Downing Street has previously suggested, by bolstering the Treasury’s team with someone with more than 20 years experience.

James Bowler was appointed at the most senior civil servant in the Treasury, and has been seen as yet another U-turn by the Prime Minister following suggestions that she wanted to bring in an outsider to the department, following the sacking of Sir Tom Scholar.

Mr Kwarteng was widely criticised for removing Mr Scholar from the role as permanent secretary, given he was one of the only senior civil servants with experience dealing with the financial crash, which could be useful in a time of economic turmoil.

In addition, Beth Russell was appointed as a second permanent secretary and is understood to be the most senior civil servant to do the role outside London, and will work from the Treasury’s presence in Darlington.

The Chancellor yesterday also met with Chloe Smith, the DWP Secretary, who is responsible for announcing the Government’s decision on the uprating of benefits.

Tory backbenchers, and some cabinet ministers, have made it clear that they feel the Government would be wrong to only increase benefits in line with earnings, rather than inflation, as this would be a real-terms loss of income for families during the cost of living crisis.

Downing Street yesterday said that no decision had been made yet on whether benefits will see this uplift, despite another former cabinet minister calling on the Government to stick to the rise which was promised by Rishi Sunak as chancellor.

“People are going through incredibly challenging times. We can all see that in our community. So I personally believe that benefits must stay in line with inflation,” former chancellor Sajid Javid told BBC Radio 4’s Today programme.

Benefits could be one of the areas that will see cuts in order to fund the pledges on low taxes, amid warnings by the IFS that these could be as much as £60 billion, and will need to be much deeper than “trimming the fat” through efficiency savings.