It is Liz Truss’s first party conference as leader – could it also be her last?

It is most definitely not the strong leadership Truss promised when she said she was willing to be ‘unpopular’ to take the difficult decisions needed to boost economic growth

“We get it, and we have listened.”

In just a few words, Kwasi Kwarteng made a monumental U-turn, abandoning his plan to scrap the 45p in the pound top rate of tax. The U-turn label is overused in politics and is (another) devalued currency. But this is a spectacular one.

Last night, Kwarteng was insisting he would press ahead with the controversial move, in pre-released extracts from his speech to the Tory conference this afternoon. They included: “We must stay the course. I am confident our plan is the right one.” After sticking to her guns in a BBC interview yesterday, Liz Truss won plaudits from Tory-supporting newspapers, with The Daily Telegraph declaring today that, like Margaret Thatcher, “Liz Truss is not for turning.”

Now Truss has done a screeching handbrake turn and Kwarteng has conceded that a tax cut for those earning more than £150,000 a year is “a huge distraction” from the “very strong plan” he announced in his ill-fated mini-Budget. True enough: the government got no credit for spending £120bn a year on keeping down energy bills. The good news became something annoying they kept repeating in media interviews to divert attention from the top-rate tax cut.

Truss and Kwarteng had no choice. With Tory MPs in open revolt, it was increasingly clear that they did not have the numbers to secure Commons approval for the top-rate tax move. Today Kwarteng insisted it was “not a question of getting it through” or about “parliamentary games”, but about listening to the public. Yet it was: the first rule of politics is to be able to count, as Lyndon B Johnson put it.

True, it was better to clear the decks sooner rather than later – in contrast with Boris Johnson, who often dug in, only to back down later – and get the space to talk about the government’s other measures and hope to stabilise the financial markets too by slimming down the unfunded tax cuts.

A climbdown later would have been even more humiliating for Truss, with much damage inflicted in the meantime. Sometimes voters are less bothered about U-turns than the media and give politicians an ounce of credit for admitting they got it wrong. That’s why Kwarteng was prepared to admit “humility and contrition” today – not the natural stance of a chancellor known for his confidence in his worldview and apparent contempt for those who do not share it.

This volte face is deeply embarrassing. It is most definitely not the strong leadership Truss promised when she said she was willing to be “unpopular” and take the difficult decisions needed to boost economic growth. Her government’s first major statement has blown up after only 10 days. The “new era” Kwarteng trumpeted has proved very short-lived, and just like the old (Johnson) era.

Right-wing MPs, free-market reformers and some Tory activists who propelled Truss to the leadership will be alarmed. They were hoping the 45p move would merely be postponed, but Kwarteng said “we are not proceeding with it”. One former cabinet minister on the right of the party told me: “This shows she is no Margaret Thatcher.”

The prime minister and chancellor will hope the decision will make it easier for them to squeeze public spending – what the markets will be looking for when they pass judgement on the chancellor’s medium-term fiscal plan on 23 November. They will be aware that some senior Tories warned party whips the government could either scrap the top rate or cut the welfare budget, but not both; the contrast would be “toxic” and mark the return of “the nasty party”, which looks after its rich friends.

However, the Tory MPs who forced this about-face, including several supporters of Rishi Sunak, will scent blood and weakness. Different groups of Tories will rebel on different issues. Some of the government’s ideas – such as not raising state benefits in line with inflation, allowing more housebuilding and diluting workplace rights – will be strongly opposed by many Tory backbenchers.

Threats to remove the whip from rebels will now carry little weight; they were made over the 45p rate only yesterday, and the government quickly blinked first. Although the pound strengthened after the dramatic announcement, the markets might not have much confidence in Kwarteng’s ability to deliver the freeze in public spending he wants, given this display of political weakness.

To keep up to speed with all the latest opinions and comment sign up to our free weekly Voices Dispatches newsletter by clicking here

The climbdown will not improve the anxious mood here at the Tory conference in Birmingham. There is a sense of drift, a vacuum of leadership. There’s even a gallows humour among Truss’s close allies about the government’s disastrous start. One told me with a rueful smile: “Nothing much happening. It’s all going well.” Others just roll their eyes when you ask them how it’s going so far.

It is a different planet to just 12 months ago, when the conference was a delayed celebration of Johnson’s 2019 election victory. He was walking on water, his authority in his party and government unchallenged. When he privately hoped for 10 years in power, it wasn’t a mad proposition, but soon after the conference he began sowing the seeds of his own downfall.

Normally, the first conference of a new leader would also be such a celebration, a time of hope and optimism. Instead, some Tories quietly wonder if it will not only be Truss’s first conference as leader, but also her last.