Spending cuts of up to £40bn expected after Liz Truss announcement

U-turns have filled less than half the £62bn ‘black hole’ created by Kwasi Kwarteng

Prime minister Liz Truss today confirmed for the first time that her tax cuts will require reductions in public spending plans – estimated by one leading economic think tank at up to £40bn.

The PM’s U-turn on corporation tax means she has backtracked on 45 per cent of the £45bn package of unfunded tax cuts announced by ex-chancellor Kwasi Kwarteng on 23 September, but 55 per cent – around £25bn – remains to be funded.

Just two days after telling the House of Commons there would be no cuts to public services, Ms Truss made clear that she will be forced to rein in spending plans to fill a black hole calculated ahead of today’s announcements at around £62bn.