she remains prime minister butjeremy hunt was clear there, prime minister butjeremy hunt was clearthere a clean slate to completely rethink this economic plan. from tax cut to possibly tax rises. a slowdown on spending. this is a back to the drawing board moment really. nothing is off the table including health and defence, normally untouchable. they could be as for savings as well. for the markets, after weeks of uncertainty and disbelief, this is being seen as and disbelief, this is being seen as a reality check and possibly whispering it, even a turning point. the markets open on monday and some on sunday night, what is your assessment of how they will react? first of all, a large chunk of this is driven by the turmoil in the markets over the last few weeks. the pounds have been battered and government spending has gone through the lee —— ruth. the bank of england and its emergency step in to help pension funds, the initial reaction as they are cautiously optimistic and they thinkjeremy hunt is a man they can trust. credibility remains pretty low however, it is a low point and the pr

going to cop27 as there is too much going on here, of course there is too much going on here butjeremy hunt there, and as nigel says, is it rather undermines any role we have in trying to persuade other countries to behave better or to cut carbon emissions, and to be more environmentally aware. and frankly you can be tickling around with a budget but if you don't sort out climate change and make a commitment to it, a budget in the economy is going to be going south very quickly anyway. the going to be going south very quickly an a . ., ., anyway. the front page of the observer. _ anyway. the front page of the observer, nigel, _ anyway. the front page of the observer, nigel, qatar- anyway. the front page of the i observer, nigel, qatar lavishes anyway. the front page of the - observer, nigel, qatar lavishes -- observer, nigel, qatar lavishes —— lavishes gifts on mps in three world cup pr drive. this lavishes gifts on mps in three world cup pr drive-— cup pr drive. this is a charm offensive _ cup pr drive. this is a charm offensive by _ cup pr drive. this is a charm offensive by qatar, - cup

butjeremy hunt says voters do not need more turmoil what they want is stability.nd the worst thing for that would be more political instability at the top, another protracted leadership campaign. i think that is the last thing people want to happen. china's president xijinping has defended his controversial zero—covid strategy communist party gathers for a congress in beijing that happens twice in a decade. iranian authorities say four inmates are dead after a fire at a prison in the capital, as protests continue. more than a thousand paddington bears and other teddies left by the public in memory of the late queen elizabeth are to be sent to charity. the new chancellor, jeremy hunt has been in talks with liz truss this afternoon — as they consider further changes to the mini budget that had been the centrepiece of her economic plan. 48 hours into thejob, mr hunt has made clear nothing has been ruled out on taxes or spending. he also said the prime minister is in charge. some of her own mps are continuing to criticise her though, to call for changes to her team an

butjeremy hunt says voters do not need more turmoil what they want is stability.litical instability at the top, another protracted leadership campaign. i think that is the last thing people want to happen. china's president xijinping has defended his controversial zero—covid strategy communist party gathers for a congress in beijing that happens twice in a decade. iranian authorities say four inmates are dead

there are a lot of changes butjeremy hunt will stay in the key post as chancellor.pointed just a few weeks ago after the failed mini—budget. on monday, jeremy hunt is due to deliver a much—anticipated statement on the government's tax and spending plans, along with analysis from the office for budget responsibility. joining me now is melanie baker — senior uk economist at royal london asset management. there are some rumours that this fiscal event on 31 october could be delayed, what do you think about that? i could be delayed, what do you think about that?— think about that? i don't think it's a particular _ think about that? i don't think it's a particular cause - think about that? i don't think it's a particular cause for- it's a particular cause for concern, if we are talking a delay of a few weeks, i think letting the chancellor and rishi sunak giving them time to come up with a fuller set of fiscal policies, having those discussions with advisers and experts, allowing more time to digestible that income up with a full set of economic and school forecasts, that

three weeks later, this morning, her new chancellor, buried that, she remains prime minister butjeremy huntas got a clean slate to completely rethink this economic plan. we've gone from tax cuts to possibly tax rises now. from huge investment to what they are calling a slowdown in spending and we all know what that means. this is a back to the drawing board moment. nothing is off the table as well as we have been hearing, health and defence, normally untouchable in normal times. they could well be asked for savings as well. in terms of the markets, after weeks of uncertainty and disbelief in financial circles about how this is playing out, this has been seen as a sort of reality check really and possibly, whispering it, even a turning point. yeah and the markets open on monday or sunday night, so what is your assessment, your thoughts of how they are going to react? first of all, a large chunk of this is driven by the turmoil we've seen in the markets over the last few weeks, the pound has been battered, the cost effectiveness of government birriwing has gone through the roof along with man

butjeremy hunt still needs to find around £25 billion, monday the last chancellor plan to give away in delay the plan for a ip cut in basic income tax. one —— unconfirmed at the moment but it could save £5 billion a year. that would still leave £20 billion to plug and it's hard to see how that could be found without tough cuts in spending. big departments like health, education, and defence are normally protected but mr hunt says nothing is off the table. back to me less money for things people really care about. welfare and benefits under the big issue. the chancellor could limit increases below inflation but many of these payments go to most vulnerable and people in low paying jobs. inflation is the biggest problem at 10% still. public—sector pay raises are not keeping up so we are seeing lots of strikes as inflation bites into household finances. holding that line on pay will be another difficult thing for the chancellor. the current interest rate of 2.25% could be rising as high as 4.25% at the end of the year. so for someone with a £200,000 mortgage they will be facing an increase

butjeremy hunt went even further, not only cancelling the proposed early cut in the basic rate of incomeni budget policies and leaving the tax—cutting prime minister with a higher cap for the basic rate of tax than she inherited. that raises £5 billion a yearfor inherited. that raises £5 billion a year for the treasury. knock that off and you still have a hole of £12 million. but the gap has grown by £20 billion at least because the economy has been hit and we face higher interest rates. all in all a large gap of £30 million and a squeeze on public spending, hard—pressed apartments perhaps, ha rd—pressed apartments perhaps, welfare hard—pressed apartments perhaps, welfare payments, perhaps more tax rises required. welfare payments, perhaps more tax rises required-— rises required. this will certainly hel us rises required. this will certainly help us towards _ rises required. this will certainly help us towards a _ rises required. this will certainly help us towards a much - rises required. this will certainly help us towards a much more i help us towards a much more sustainable public f

butjeremy hunt says voters do not need more turmoil.hat we want to stability, and the worst thing for that would be more political instability at the top, another protracted leadership campaign. i think that's the last thing that people really want to happen. with public spending as well as taxes in the spotlight we'll look at at the chancellor's options, and how welfare payments could be affected. and also coming up on this evening's programme... china's president defends his zero—covid policy as the communist party gathers for a congress that happens twice in a decade. and a shock for scotland at the rugby league world cup as italy gain an easy win. good afternoon. the new chancellorjeremy hunt has been in talks with liz truss this afternoon as they consider further changes to the mini budget that had been the centrepiece of her economic plan. 48 hours into thejob, mr hunt has made clear nothing has been ruled out on taxes — or spending. he also said the prime minister is in charge. some of her own mps are continuing to criticise her,

he has only been in the job for three days butjeremy hunt was to persuade the markets the governmentre time to come up with a bigger plan but be under no illusion this morning, what the government is announcing is the completejen king of what it was announcing three and a half weeks ago. it's been a dizzying few weeks in parliament and it will be dizzying again this morning —— the completejumping. does the morning. we can speak now to our economics editor, faisal islam. faisal, what can we expect from the chancellor? what is there left to do a u—turn on? what is there left to do a u-turn on? ., , what is there left to do a u-turn on? . , ., what is there left to do a u-turn on? ., , ., ., . , on? he has two audiences, the audience of _ on? he has two audiences, the audience of the _ on? he has two audiences, the audience of the markets, i on? he has two audiences, the| audience of the markets, trying on? he has two audiences, the i audience of the markets, trying to re—establish some of that lost credibility, that the british government will control its finances and it's boring but a

the spike in the price of energy and the government had introduced the energy price guarantee butjeremy huntp to fill a significant chunk of that whole, so we are probably nearer to the 30 billion rather than the 40 billion but beyond that there will be difficult decisions to be made as to whether it will be filled by higher revenues which could mean higher taxes but there are other ways of enhancing government revenue to. although it involves a further squeeze on public spending, and remember the existing cash limits set a year ago have not been adjusted for the higher inflation we have seen in the past year, so they already employ a significant squeeze on the public sector so sunak and whoever his chancellor will be will have to make some difficult decisions there. i think the crucial issue and there is a measure of things you can choose from, the crucial thing will be whether conservative mps who are now all talking about unity, but when it comes to being faced with particular measures they don't like, are they going to support them or are we going to support them or are we going to suppo