Kwasi Kwarteng has been sacked as the Chancellor of the Exchequer after just a matter of weeks in charge.
The change in Number 11 Downing Street was brought about by a disastrous ‘mini-budget’ released by Kwarteng, in which he promised to remove the 45p income tax rate – a move the government later U-turned on – and delivered a raft of tax cuts for the richest in the UK, favouring perceived ‘economic growth’.
It is not yet known who he will be replaced by, and Prime Minister Liz Truss is expected to announce another 180 on more of the tax cuts announced in the financial statement in a news conference scheduled for later today.
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Kwarteng will now enter history as the second shortest serving Chancellor of the Exchequer, spending just a month and eight days in post.
The shortest in the job was Iain McLeod, who died of a heart attack after only 30 days in the job back in 1970.
In third is Kwarteng’s predecessors Nadhim Zahawi at 63 days and Sajid Javid, who lasted for 204 days, both under former PM Boris Johnson.
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Kwarteng had returned from the United States overnight for an urgent conversation with the already beleaguered prime minister.
Those talks came amid speculation that the government is set to backtrack further on the measures they set out in last month’s statement.
After the measures were announced, the financial markets took a battering, with the pound falling to the lowest rate in a long time against the dollar, and – while markets have recovered at times – it seems as if the damage to the Chancellor’s ambitions was done with those plans.
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Conservative Peer Lord Vaizey earlier told Sky News that Kwarteng’s return to the country was ‘quite unusual’, adding: "It's not a good sign, it does not look like the government is in control."
Former Labour leader Ed Miliband said the Tories should be ‘hanging their head in shame’, adding that the government is ‘in meltdown’ with their totemic economic measures ‘in tatters’.
He said: "This is about people's livelihoods, people's homes, people's mortgages."
Financial markets have responded to the potential U-turn from Truss positively, though some Conservative sources have pointed to other possible reasons for the upturn.
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It remains to be seen whether Truss will turn full-circle on her corporation tax cut policy, with Kwarteng himself saying yesterday ‘let’s see’.
Kwarteng came into office as an MP in 2010, when he was elected in Surrey.
Following that, he backed Leave in the Brexit referendum, co-authored a book in which he described British workers as ‘idlers’ and entered the Johnson government as business secretary, before arriving as Chancellor under Truss once Johnson was himself ousted.
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The budget that eventually saw him lose that position promised £45 billion worth of tax cuts across the board, but left the Bank of England needing to intervene after chaos erupted in the financial markets.
Tom Wood