Prime Minister Liz Truss has acknowledged "mistakes have been made" when meeting the 100-strong One Nation group of centrist Tory MPs, Conservative Party chairman Jake Berry has said.

He told journalists "unity" had been the focus of the meeting and that the prime minister was "bringing the party together".

Berry also said former Health Secretary Matt Hancock made a "really good intervention", saying that "we've got to get behind the PM".

Image source, Stefan Rousseau/PA Wire

Government spending cuts will be needed to close a £40 billion "fiscal black hole", Mel Stride - who is the Conservative chair of the Treasury Select Committee - has predicted.

Speaking to BBC Radio 4's PM programme, Stride says he and others "did warn" during the summer's Conservative leadership campaign that Liz Truss's tax plans would "spook the markets".

He said he always thought that plunging into "very large-scale unfunded tax cuts at a time of high inflation, tight labour markets, and sluggish growth" would be likely to trigger market turmoil.

Stride added that by rolling-back much of last month's mini-budget, new chancellor Jeremy Hunt "has diminished the size of the fiscal black hole by £32bn".

Although Stride calls this an "eye-watering amount", he also predicts Hunt still has "another £40bn to go" and is under half way to reducing a gap of "about £70bn or £72bn".

Chancellor Jeremy Hunt has taken questions from MPs in the House of Commons for the past two hours about his decision to reverse almost all of Liz Truss's tax cuts. Here's a recap what he said:

• Tough choices: Hunt said that "eye-wateringly difficult" decisions were needed

• Windfall tax: He said he is "not against the principle" of windfall taxes and "nothing is off the table" in response to Liberal Democrats leader Ed Davey, who asked if a "proper windfall tax" will be introduced to help struggling families
• Bankers' bonuses: The chancellor defended lifting the cap on bankers' bonuses, saying that the previous policy "didn't work" and "we will get more tax from rich bankers with the policy we now have"
• Triple lock: Hunt refused to commit to state pensions rising with inflation in April, telling MPs he will not make "any commitments on any individual policy areas"
• Benefits uprating: He also gave no detail on whether he will increase benefits in line with inflation, saying such decisions will be looked at "in the round"
• Defence spending: Hunt refused to guarantee the government would deliver on its promise to spend 3% of GDP on defence, saying any increase in spending would have to be sustainable over many years
• OBR: Asked if when OBR reports are produced they would show debt falling as a proportion of income and - once finances are under control - that day-to-day government spending will not be funded from borrowing, Hunt said: "Yes, and yes."
• Extra revenue: Hunt told the House that the tax changes would raise £32bn a year
• Economic Advisory Council:Hunt announced the formation of the new Economic Advisory Council to provide "independent expert advice" to the government on economic policy

Iain Watson
Political correspondent

Both Downing Street sources and sources from the 1922 Committee confirm that Liz Truss has met Sir Graham Brady - the chairman of the backbench committee which oversees Conservative Party leadership rules and elections - today.

Number 10 sources told me the meeting had been planned and it did not necessarily coincide with this afternoon's urgent question where Penny Mordaunt was sent to answer instead of the prime minister.

We've been hearing a lot from the House of Commons this afternoon.

In case you need a reminder, here's a summary of what exactly has been ditched and retained from Liz Truss and Kwasi Kwarteng's original mini-budget.

Image source, .

Chris Mason
Political editor

Image source, House of Commons

Liz Truss's programme for government is dead - the last rites on almost all of it delivered by the new Chancellor Jeremy Hunt - the prime minister silent.

Her prospectus for the leadership, the very pitch she made to Conservative members, obliterating on contact with reality and a new chancellor hastily appointed to prop up her premiership.

A prime minister who had belittled what she called over the summer the "abacus economics" of the Treasury, signing off a giant wave of U-turns grounded in numbers designed to reassure the markets.

But what is reassuring to markets will prompt worry for millions of others: a chancellor saying tax cuts are cancelled, but that spending cuts are coming.

Markets may take comfort that the government's making a more plausible case that its numbers add up.

But it might be much harder for many of the rest of us to do just that ourselves.

Today was about two things: the near wholesale unravelling of those budget measures. And the future of Liz Truss.

Plenty of her MPs think she is done for: an empty vessel of a prime minister, mugged of her agenda and her credibility.

Very few believe she could possibly lead the Conservatives into the next election, so it becomes a question of when, not if, she is forced out.

Her programme might be finished, but for now at least, she isn't - she appears determined to stick around.

Read more from Chris Mason here: A government living hour by hour

Former Labour leader Jeremy Corbyn tells Parliament the UK is a "deeply divided country, more than ever".

He calls on the chancellor to raise benefits in line with inflation.

"There are more people in poverty, there are more people accessing food banks than ever before and more children growing up in absolute poverty," he says.

Hunt says he is not “giving that answer on any area of spending or tax policy” because of the “grave” situation. Instead, he said that the government “will have to look at these decisions in the round”.

He says he will come to the House “as soon as that decision has been made and audited by the OBR”.

Labour MP Jess Phillips says she feels "a tiny bit gaslit" by the fact that Hunt is being complimented "as if the last four weeks have not happened".

She asks Hunt how he is going to pay for the unfunded stamp duty cut, to which he answers: she'll find out in two weeks.

Former leader of the Liberal Democrats Tim Farron says the cut in stamp duty will help people who buy second homes and rent them out as AirBnbs.

The MP for Westmorland and Lonsdale adds: "The cut in stamp duty will do nothing for anyone who cannot afford to buy a home, what it will do is add fuel to the fire of second home ownership and AirBnb disaster.

"We understand the damage that excessive second home ownership and AirBnb does to communities like mine."

Jeremy Hunt replies that he does understand the concerns regarding second home owners, but says it is wrong to be dismissive of young people trying to get on the house ladder. He says the stamp duty reforms will help.

Labour MP Tanmanjeet Singh Dhesi asks the chancellor whether, if he and the prime minister no longer have a democratic mandate to continue in their positions, they should step aside and let the British people make their decision.

Hunt says he doesn't think a general election would contribute to stability if people had "to worry about the disastrous policies of a future Labour government".

Labour MP Steven Kinnock asks the Chancellor whether he thinks it is "morally justifiable" to lift the cap on bankers' bonuses while refusing to link benefit rises to inflation.

"I understand why he asks the question," Jeremy Hunt answers.

"I believe that wealthier people should pay more as we go through a difficult period," he says.

"But I think the mechanism with the cap wasn't working, we will get more money out of the pockets of rich bankers by what we are going to do now."

A Treasury source tells the BBC the plan to remove the cap on bonuses is still going ahead.

It's understood the plan will be consulted on by the Prudential Regulation Authority (PRA) later this year.

Next up is Green Party MP Caroline Lucas.

She says the chancellor hasn't been specific about what would happen to the investment zones policy. She says it is designed to undermine environmental regulation.

Lucas says in the past the chancellor has said he is a "green Tory" but that is an endangered species now.

She asks if he will rule out any policies that will undermine nature protection and restoration.

Hunt says he is committed to protecting green spaces and boosting biodiversity, but he also thinks it's important to look at environmental regulations to see if they can be streamlined in a way that will allow the natural world to flourish as well as the economy.

Conservative MP Tobias Ellwood asks if the chancellor will commit to continue the promise of 3% GDP defence spend.

Hunt says he's sympathetic, but an increase in defence spending has to be an increase that can be sustained over many years.

Conesrvative Mark Harper says a seventh of the population are not on the gas grid. He asks Hunt to make sure the energy price guarantee will work for those off-grid.

"I will certainly bear that point in mind," replies Jeremy Hunt, "we need a scheme that works practically," and says it "isn't particularly easy to design a scheme" like that.

Asked if he can commit to state pensions rising with inflation in April, the chancellor does not do so.

He says he is "aware" of the importance of the pensions "triple lock" but isn't making any commitments on individual policies.

Tory MP for Gainsborough Sir Edward Leigh is calling for tax cuts to be brought back.

"What is our vision?" he starts.

"Does the chancellor accept we can’t just accept sliding into a second-rate economy?," he asks.

He finishes by saying tax must return to 2019 levels by the next election and corporation tax must fall - "otherwise what is the point of the Conservative Party?".

Labour MP Siobhain McDonagh asks the chancellor why he decided to carry on "boosting bankers' bonuses in the heart of a cost-of-living crisis".

Hunt responds by saying the previous policy didn't work and the government will get more tax from rich bankers with the policy we now have.

Labour's Rushanara Ali asks Hunt whether he can assure people he will bring down mortgages.

"And if he can't, can [people] send the bill to him?", she asks.

Hunt says he has the responsibility to hold increases in mortgages down as much as possible - which is why he has taken "very strong and quick steps to demonstrate the government's commitment to fiscal balance", but, he adds, interest rates are going up everywhere.

Nick Eardley
Chief political correspondent

We’ve just seen the chancellor rip up another policy.

Liz Truss has said she was against the principle of windfall taxes.

The chancellor just said he was open to taxing genuine windfalls - and nothing was off the table.

Jeremy Hunt has some concerns about emergency taxes in oil and gas company profits - because he says their profits come and go.

But the idea of windfall taxes - so hated by the prime minister a few weeks ago - seems to be back on the agenda.