Kwasi Kwarteng will bring forward the government’s medium-term fiscal plan from November to the end of October following calls to reassure the markets, it has emerged.
The chancellor said in a letter to Mel Stride, Tory chairman of the Treasury select committee, that the spending and borrowing plan would be announced on 31 October – rather than 23 November as promised.
The Treasury confirmed the move to bring forward the publication of the financial strategy – and the Office for Budget Responsibility (OBR) assessment of government plans – to Halloween.
Bowing to pressure in his letter to Mr Stride, Mr Kwarteng said he hopes “this short extra delay is acceptable”.
Mr Stride had told The Independent that waiting until 23 November could pile hundreds of pounds onto mortgages by making higher interest rates more likely.
The latest U-turn follows a decision by Liz Truss and Mr Kwarteng to ditch the planned axing of the 45p rate of tax for the very wealthiest in society.
The PM is reportedly considering another U-turn on the idea of increasing benefits payments by less than inflation, with many backbenchers irate at the prospect of a real-terms cut.
Former Tory chancellor Sajid Javid became the latest to intervene in the row, telling BBC Radio 4’s Today programme that benefits “must” be raised in line with inflation rather than a lower rate of earnings.
Mr Javid also joined rebel Tory MPs warning chancellor Kwasi Kwarteng that 23 November was too late to announce his fiscal plan and share OBR assessments. “I think the sooner the better, as far as the markets are concerned.”
Ms Truss is expected to launch a “charm offensive” this week by holding policy lunches with groups of MPs and addressing the 1922 Committee of backbenchers on Wednesday.
But backbenchers are not the only ones angry over benefits. Members of the cabinet are reportedly ready to press the PM on the issue of uprating benefits in line with inflation when they meet on Tuesday.
Ms Truss is “genuinely undecided” on the issue and will be “listening” to colleagues, Downing Street sources have said.
It comes as the Bank of England announced an expansion of its emergency gilt-buying programme, launched after Mr Kwarteng’s mini-Budget sparked market turmoil and threatened pensions.
The Bank said it will double the daily limit on its gilt-buying programme from £5bn to £10bn as it brings the scheme to an “orderly” close ahead of Friday’s cut-off.
But there have been fears there could be a return to pension fund woes when the scheme ends on 14 October.