Jeremy Hunt has announced he is creating an economic advisory council to assist the government as it seeks to repair the damage caused by last month’s mini-budget.

The council’s membership will include Rupert Harrison, who was chief of staff to former chancellor George Osbourne during the austerity era of 2010-2015, and Karen Ward, who advised former chancellor Philip Hammond after Brexit, and now works for investment bank JP Morgan.

Announcing the measure in the Commons, the new chancellor said the group will provide “more independent expert advice” to ministers.

The Liberal Democrats said the panel should be made up of housing and debt charities instead of only asset managers.

The panel will also feature two former members of the Bank of England’s monetary policy committee: Gertjan Vlieghe, who is now chief economist at US hedge fund Element Capital, and Sushil Wadhwani, chief investment officer for asset management company PGIM Wadhwani.

Sarah Olney, the Lib Dem Treasury spokeswoman, said: “An advisory panel of purely wealthy asset managers in the middle of a cost-of-living crisis proves just how out of touch this Conservative government is.”

Mr Hunt made the announcement in the Commons hours after tearing up the bulk of the economic strategy that brought Liz Truss into office as prime minister six weeks ago.

The prime minister was in the chamber for around half an hour as he spoke, after ducking an urgent question from Labor earlier.

Hinting at a potential further U-turn as he took questions from MPs for two hours, Mr Hunt also said he is “not against the principle” of windfall taxes – something Ms Truss was opposed to.

Responding to a question from Lib Dem leader Sir Ed Davey, he said: “I am not against the principle of taxing profits that are genuine windfalls.

“We have said that nothing is off the table.”

In a further diversion from Ms Truss’ policies, Mr Hunt failed to commit to spending 3% of GDP on defense – a key pledge made by the prime minister during the Conservative leadership race.

He also failed to promise the triple pension lock will stay – a policy that formed part of the Conservative’s 2019 manifesto – and failed to guarantee benefits will increase in line with inflation.

Mr Hunt said he is not making “firm commitments” on any individual elements of tax and spending.

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Conservative MP Sir Charles Walker said the prime minister ‘has put the country through a huge amount of unnecessary pain’

“I’m not making any commitments on any individual policy areas, but every decision we make, will be taken through the prism of what matters most, to the most vulnerable,” he said.

Mr Hunt was in the Commons to set out further details of his economic plan, after reversing “almost all” of his predecessor’s tax cuts and scaling back the energy bills freeze package.

The changes Mr Hunt has announced include:

  • No cuts to dividend tax rates
  • Repeal of the easing of IR35 rules for the self-employed introduced in 2017 and 2021
  • No new VAT-free shopping scheme for overseas visitors to the UK
  • Do not freeze on alcohol duty rates
  • Basic rate of income tax to remain at 20%, not reduced to 19% from April 2023
  • Energy price guarantee only until April 2023.

He told MPs growth requires “confidence and stability”.

Tories are ‘out of credibility and out of chancellors’

Shadow chancellor Rachel Reeves warned the “damage has been done” despite the “humiliating U-turns”.

She said of Mr Hunt: “The fourth in four months of chaos and fiasco as this Conservative Government spirals down the political plughole. But the damage has been done.

“This is a Tory crisis made in Downing Street but ordinary working people are paying the price.

“The Tories have run out of credibility and now they are running out of chancellors.”

Ms Truss became prime minister after winning the Tory leadership contest on the back of promises to dramatically cut tax and upend the status quo in the Treasury.

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But Ms Truss and Kwasi Kwarteng’s tax-slashing mini-budget unleashed turbulence in the financial markets, leading to Mr Kwarteng’s dramatic sacking as chancellor and the installation of Mr Hunt in an effort to reassure investors.

Truss’s position ‘is untenable’

Some Tory MPs are now calling for Ms Truss to go, with senior Conservative MP Sir Charles Walker telling Sky News’ political editor Beth Rigby: “I think her position is untenable.”

However, Mr Hunt has told Sky News he believes Ms Truss will still be PM at Christmas and Tory MPs plotting to oust her should give her a chance.

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