Tory leadership race: Liz Truss bids to make final two

Liz Truss has pledged to boost the economy through tax cuts, as she bids to regain the initiative in the race to be the next Conservative leader.

The foreign secretary said she was "ready to be prime minister from day one", as she launched her campaign.

She is currently third behind Penny Mordaunt and Rishi Sunak after the first round of voting by Tory MPs.

The MPs are whittling down the field to two contenders, who will then face a vote of Tory Party members.

The second round of MPs' voting has finished, with the candidate with the fewest votes set to be eliminated when the results are announced at 15:00 BST.

More MP ballots will be held until there are only the final two candidates, who will then face a vote by Tory Party members to decide who will be the next party leader and prime minister.

The first round of MP votes on Wednesday saw former Health Secretary Jeremy Hunt and Chancellor Nadhim Zahawi knocked out of the contest.

Kemi Badenoch, Suella Braverman and Tom Tugendhat remain in the race to replace Boris Johnson as prime minister, alongside the top three of Mr Sunak, Ms Mordaunt and Ms Truss.

A senior member of Ms Truss' campaign has urged backers of Ms Badenoch and Ms Braverman to "recognise the reality of the situation" and unite behind the foreign secretary.

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In a speech launching her campaign, Ms Truss pledged to move away from "business-as-usual economic management," adding this had delivered "low growth for decades".

She promised to reverse April's National Insurance hike, reverse next year's scheduled rise in corporation tax and set up "low tax zones" to help attract business.

She re-committed to Mr Johnson's levelling up project to reduce regional inequalities "in a Conservative way".

And in a bid to emphasise her experience in government, she said she had "consistently delivered" and shown she wouldn't "give in to Whitehall".

Ms Truss sought to stress her leadership credentials on Brexit and defence, but warned that the economy would "not get back on track overnight".

She promised to get the country on an upwards trajectory by 2024 and added she would seek to treat debt taken on in response to the Covid pandemic as a one-off event, paying it off over a longer period of time.

Asked about whether her backing for Mr Johnson could count against her, Ms Truss said that she was a "loyalist" and had supported his aspirations.

Tax cuts tussle

The foreign secretary's tax pledge follows a competing offer set out by Ms Mordaunt on Wednesday, who said she would slash VAT on fuel and raise income tax thresholds.

Their offers mark a contrast with former chancellor Mr Sunak, who says tax cuts should wait until inflation goes down.

Speaking to BBC Radio 4's Today programme, he said tackling rising prices would be his "number one priority," warning that inflation "makes everybody poorer".

"I don't cut taxes to win elections, I win elections to cut taxes," he added.

Although Mr Sunak has emerged as a clear front-runner among Tory MPs after the first round of voting, the contest remains open and there will be intense competition among top contenders to pick up supporters from eliminated rivals.

Ms Mordaunt, who was defence secretary under Theresa May but has held lower-ranking posts under Mr Johnson, has emerged as the surprise performer in the contest so far and is battling to maintain her position as the main challenger to Mr Sunak.

As campaigning continues:

• Ms Mordaunt told the Sun newspaper she would tackle English Channel migrant crossings by cutting off fuel supplies to people smugglers

• After being eliminated from the contest, Mr Hunt threw his weight behind Mr Sunak, calling him "one of the most decent men" in British politics

• But Chancellor Mr Zahawi said he didn't intend to make "any further intervention" in the contest after being knocked out

Conservative MPs will continue their rounds of voting over the coming days, with the aim of narrowing the field to two final candidates before Parliament's summer break at the end of next week.

Around 160,000 Conservative Party members decide which candidate they want to become the next party leader and prime minister.

The result will be announced on 5 September.

Mr Sunak is well out in front and the working assumption is he will get one of the two golden tickets into the run-off - the vote of Conservative Party members.

But the fizz and chatter, for now at least, is about Penny Mordaunt, the runner-up in round one.

If she were to win this race, she'd be the most little-known prime minister on assuming office of modern times.

The challenge for Foreign Secretary Liz Truss, as she launches her campaign, is to prove that she is competitive and can grab a slot in the final two.

Read more from Chris Mason.