David Brown
Visual Journalism Team

With Liz Truss's authority under huge pressure, her former Tory leadership rival Rishi Sunak has emerged as the bookies' favourite to succeed her if she should leave Downing Street.

Boris Johnson's early lead in the betting has disappeared, and Defence Secretary Ben Wallace is now in second place.

Image source, .

Chancellor Jeremy Hunt saw his odds spike on Friday, and dip slightly today. Meanwhile Penny Mordaunt's chances have been relatively stable at between six and 11%.

As we've been reporting, many Tory MPs have welcomed the appointment of Jeremy Hunt as chancellor. However, that does not mean the problems for the prime minister are going away.

Mark Garnier, Conservative MP for Wyre Forest, has told BBC Radio 5 Live that he believes there should be a general election soon.

He had supported Rishi Sunak in the Tory leadership election, but says Liz Truss should respond with "contrition" to what's taken place since Kwasi Kwarteng's mini-budget.

He says he believes it is "perfectly acceptable" that there should be a general election in the event of a new leader to "actually test the validity of that leader to the wider public".

Meanwhile, another Conservative MP has told the BBC that Truss is "prime minister in name only... her days are numbered... there's no way back".

The MP says, however, that there "mustn't be a leadership contest". There's a growing consensus, according to this MP, that Rishi Sunak should installed PM, along with Penny Mordaunt and Jeremy Hunt.

Another Tory MP simply said "she's toast".

David Wallace Lockhart
BBC political correspondent

The new Chancellor Jeremy Hunt is speaking to Tory MPs in a committee room in the Commons.

Most MPs emerging seem to be satisfied with what they’ve heard. One says they are “very happy to see Jeremy”.

Another says Hunt has “calmed the horses” and is what’s needed right now.

Robert Halfon - who was previously very critical of Truss - says he was “really comforted” by what he heard.

That being said, a meeting between the chancellor and backbenchers is not going to solve all the problems in the Tory Party right now.

Nick Eardley
Chief political correspondent

Conservative MPs - most of whom were surprised by the chancellors statement this morning - are now scrambling to get to a briefing in parliament.

Jeremy Hunt is updating them on his new strategy and the unprecedented junking of government policy.

But many MPs aren’t actually in London yet. They may have to wait until the chancellor addresses the Commons later.

Labour have told us they've been given an opportunity to ask an urgent question in the Commons on the "Tory economic crisis".

The question demands that the prime minister must appear in the Commons to make a statement on the current economic situation.

The party says it is doing everything it can to "force her to come to the Commons".

A Labour spokesperson says "if she had a shred of authority left she would turn up".

The urgent question will take place at 15:30, with the statement from Chancellor Jeremy Hunt now due to take place immediately after, probably at about 16:30.

It is unclear whether the prime minister will stay with Jeremy Hunt for his statement.

Image source, Getty Images

One of the measures announced by the chancellor has been to reverse plans to reintroduce VAT-free shopping for international visitors.

Paul Barnes, Chief Executive of the Association of International Retail, says this is a "hammer blow" to UK tourism at the British high street.

He adds: “This short-sighted move is based on inaccurate and incomplete projections, and risks putting a brake on the return of international visitors who are vital drivers of economic growth throughout the UK.

Image source, James Greenhalgh

James Greenhalgh runs a coffee shop in Leeds city centre, and says he's frustrated by the government's U-turns on policies.

"The government want to go for growth, but I can't grow my business if I have no idea what headwinds are coming," he tells Radio 5 Live's Naga Munchetty.

"It's really basic economics, you cannot plan anything if you cannot plan what's coming in and going out."

Speaking about his views on former Chancellor Kwasi Kwarteng and his replacement Jeremy Hunt, he says he wants "somebody running the economy who has business experience".

"We've had Kwarteng who never ran a business in his life, and this current chancellor has three failed businesses.

"A 15-year-old could probably run a school tuck shop account better than what this government is doing and have more competence, experience and credibility."

Prime Minister Liz Truss has responded to her new chancellor's emergency statement in which he announced the reversal of almost all the flagship measures set out in her government's mini-budget a few weeks ago.

She said the government was taking action to "chart a new course" for growth.

She had originally defended her raft of tax cuts funded by government borrowing as the right way to put the UK on a path to economic growth, vowing to take on an "anti-growth coalition" which criticised the plans.

On Friday she sacked Kwasi Kwarteng as chancellor, saying the mini-budget "went further and faster than markets were expecting".

BBC political correspondent Nick Eardley gives his analysis of the new chancellor's emergency statement.

"Trussenomics totally hunted down and gone" is the reaction from consumer campaigner Martin Lewis to Jeremy Hunt scrapping almost all of the tax cuts in the mini-budget.

The reining in of the Energy Price Guarantee - now limited to a review after six months rather than two years - will still need to ensure people are supported with paying their bills, Lewis says.

"While energy intervention was desperately needed - a universal energy price guarantee was always expensive and poorly targeted. The post-April support will still need reach a decent way up the net and support middle earners, energy rates are still huge," he tweeted., external

Nick Eardley
Chief political correspondent

A former cabinet minister has told me Hunt's economic statement just now confirmed that Truss "is a goner, it put it beyond any doubt".

They continued: "What is the point of Liz Truss? That is the question... there is literally no point."

Another MP says: “The whole basis of her premiership is shredded… she needs a way out”

Image source, Reuters

We're now getting some detail on how the morning unfolded for Liz Truss and Jeremy Hunt before the chancellor's economic statement.

At 10:00 BST - an hour before Hunt announced he was scrapping "almost all" tax cuts from the mini-budget - Truss held a cabinet call to discuss the decision.

During the meeting, the chancellor set out the "worsening global economic situation, with interest rates rising around the world as monetary policy returns to a sense of normality", according to No 10.

Hunt also outlined the measures he would be announcing to "reassure the markets and the public", they said.

The chancellor is expected to meet all secretaries of state this week to decide on future spending plans which will then be submitted to the Office for Budget Responsibility on Friday.

Kevin Peachey
Personal finance correspondent

Image source, Getty Images

By dismantling policies from the so-called mini-budget of just a few weeks ago, Chancellor Jeremy Hunt has rewritten the prospects for your finances.

The government's Energy Price Guarantee was originally put in place for two years - to limit the price that suppliers could charge for each unit of energy.

Now that will be limited to six months, just to cover this winter. The Treasury will review support given from April, but Hunt said there would be "a new approach" targeting those in the most need.

Remember, you will still pay for the gas and electricity you use. For a typical household - one that uses 12,000 kWh (kilowatt hours) of gas a year, and 2,900 kWh of electricity a year - it means an annual bill will still not rise above £2,500 until next spring. Last winter it was £1,277 a year.

After that, the details will be decided by the review.

Read more on what today's statement means for you here.

There's plenty to digest from the chancellor's surprise economic announcement. Here's a quick recap of the key points Jeremy Hunt made in his televised address:

What goes:

• Planned 1p cut in basic rate of income tax put on hold indefinitely - rate will remain 20%
• Energy price guarantee will no longer last two years - it will last until April next year and then be reviewed to save money and better target support

• Dividend tax cut will be abolished
• VAT-free shopping for visitors and alcohol duty freeze both scrapped
• Reforms to off-payroll working rules - also known as IR35 rule changes - will no longer be repealed

What stays:

• Cuts to stamp duty and National Insurance remain in place
• No stamp duty is now paid on the first £250,000 of a property's value for all buyers in England and Northern Ireland; for first-time buyers it is £425,000
• National Insurance contributions increased by 1.25% in April but this is still being reversed next month

What next:

• Hunt vowed there would be more difficult decisions on tax and spending, and that there would have to be cuts
• The chancellor will give a statement to the House of Commons later today and will answer questions from MPs

An utterly extraordinary un-budgetpublished at 11:33 British Summer Time 17 October 2022

11:33 BST 17 October 2022

Faisal Islam
Economics editor

We have witnessed an utterly extraordinary un-budget, perhaps marking the biggest U-turn in British economic history.

Roughly £45bn of unfunded tax cuts has in just three weeks and three days seen a £32bn reversal.

We may need new terminology. "U-turn" suggests a controlled manoeuvre. This is like a plane trying to do the jet engine equivalent of a handbrake turn.

But it will have a real impact, particularly the decision to target energy bills help in a more targeted way after April. There are reasonable questions now about higher taxes and less help as we enter a recession.

Much of this has been inevitable since the Monday after the mini-budget. It should help regain economic credibility. But it is such a political about-turn, that one wonders if the whole cabinet, government and Conservative party will support it.

The new chancellor’s message will be this: There is no alternative.

The pound rose and government borrowing costs fell as investors welcomed the news that Chancellor Jeremy Hunt is reversing almost all tax measures set out in the mini-budget.

Sterling extended early morning gains against the dollar, and is now trading at around $1.13.

The news also saw the interest rate - or yield - on UK government bonds fall, making government borrowing less expensive.

The yield on bonds due to be repaid in 30 years' time, which dropped when markets opened on Monday morning, fell further after Hunt’s statement, to 4.35%.

Meanwhile, the yield on bonds due to be repaid in five years' time, which underpins the cost of new five-year fixed rate mortgages, also fell to 3.86%.

The drop in yields suggests financial markets are welcoming the changes to economic plans.

Image source, .

Chris Mason
Political editor

The Truss programme for government is dead.

Nearly every element of her prospectus has just been shredded by her new chancellor.

"We will reverse almost all the tax measures" from the mini-budget, Jeremy Hunt said. What an extraordinary thing to hear.

Not only has the planned cut in the basic rate of income tax been binned, so has the plan originally from Rishi Sunak to cut it in 2024.

The prime minister, who promised to cut taxes by more than her rival over the summer, is now keeping them higher than he planned.

And even the flagship energy support package, the crutch upon which the prime minister has leant whenever asked a tricky question in the last few weeks, has shrivelled vastly.

It is now a six-month package, not a two-year one. What a day.

And it’s not even lunchtime.

Read more from Chris by clicking here

Jeremy Hunt said a Treasury-led review would take place to look at how households and businesses are helped with energy bills from April next year.

He said support being provided from now until then would not change but beyond that date there would have to be changes.

The objective is to design a new approach to save taxpayers' money while targeting support to those most in need, he said.

Business support will go to those most affected and will incentivise energy efficiency, he added.