Jeremy Hunt named new Chancellor after PM sacks Kwarteng and performs U-turn on corporation tax

Jeremy Hunt has become the fourth Chancellor in 15 weeks after the fallout from last month’s mini-Budget forced Liz Truss to sack Kwasi Kwarteng.

Kwarteng had returned from IMF meetings in the United States last night and was called to Downing Street on Friday lunchtime to learn his fate.

He was in post for only 38 days – the second shortest-serving UK Chancellor in history after Iain Mcleod, who died of a heart attack after just 30 days in the job in 1970.

The UK is in the unprecedented poisition of having a sixth Chancellor in just over three years, with Nadhim Zahawi, Rishi Sunak, Sajid Javid and Philip Hammond all occupying Number 11 since July 2019.

Hunt has previously spent nine years as a Cabinet minister – at Culture, Health, and then a year as Foreign Secretary – but went to the backbenches when Boris Johnson become Prime Minister.

He becomes Chancellor at one of the hardest moments in recent memory, with self-inflicted domestic economic and political crises combining with global economic challenges.

Kwarteng has been blamed for the tumultuous recent mini-Budget which crashed pound and caused mortgage lenders to withdraw products and raise interest rates for homebuyers and owners.

Kwarteng confirmed he had been asked “to stand aside” in the formal exchange of letters with the Prime Minister confirming his departure.

He wrote: “When you asked me to serve as your Chancellor, I did so in full knowledge that the situation we faced was incredibly difficult, with rising global interest rates and energy prices. However, your vision of optimism, growth and change was right.”

Truss, in response, said: “We share the same vision for our country and the same firm conviction to go for growth.”

It is this vision that means Truss faces a fight for her political future. Kwarteng’s mini-Budget was the platform on which she campaigned to be Conservative Party leader this summer.

Truss’s letter to Kwarteng also said: “I deeply respect the decision you have taken today” – which puts the onus for his departure on Kwarteng and does, for a very short period at least, avoid the question of why he was sacked for carrying out her policy platform.

In a brief press conference on Friday afternoon, a visibly-shaken Truss went back on her plan to scrap the rise in corporation tax, confirming it will go up from 19% to 25%.

She said: “My conviction is to go for growth. The potential of this country has been held back by low growth.

“Jeremy Hunt shares my convictions for the country. He will see through the support for people and businesses.

“Parts of our mini-Budget went further and faster than the markets had expected. This is difficult – but we will get through the storm.”