Tory conference: Can Liz Truss and Kwasi Kwarteng survive such a disastrous U-turn?

As Kwasi Kwarteng stepped out to muted applause in his first conference as Chancellor, he must have stopped to wonder if it would be his last.

Because make no mistake, that is a real possibility, with not just his job at risk but the Conservative party as a whole.

Just hours before his set piece speech at the Conservative Party conference in Birmingham, Mr Kwarteng had abandoned his plan to scrap the 45p income tax rate for people earning more than £150,000.

Chancellor Kwasi Kwarteng and Liz Truss have been forced to drop their plan to scrap the 45p top rate of tax (Picture: Leon Neal/Getty Images)

Speaking to MPs ahead of it, they had welcomed the U-turn, but also made clear they had little confidence in both him and the leadership as a whole.

One told me: “I’m actually feeling much better about things now, I am feeling more optimistic.

“But I’m obviously not happy about there being so many idiots in Government, I just have to hope we’ve hit the low point”.

Another, who had supported Rishi Sunak in the leadership election, told me the party was “dead” and it was just a matter of when it realised it.

Chancellor of the Exchequer, Kwasi Kwarteng is under pressure after a dramatic u-turn.

They explained: “I don’t feel good about basically anything to do with us now.”

Others were more optimistic, but explained they still weren’t happy, stressing the damage had already been done.

“I’m very happy, it should not have got to this point, but they’ve listened and we move on,” said one.

This has been the recurrent theme of conference, MPs, staffers and advisers lamenting the state of the party, and talking about the end of Ms Truss as a matter of “when not if”.

That is the ones who turned up anyway, with multiple MPs telling me they weren’t coming to conference.

One explained: “I had a feeling it was going to be horrible, so I thought it best to stay away.”

It is noteworthy that this included those who supported Ms Truss, with the mood in the party something I’ve never experienced before.

At the last two Tory conferences, the mood was buoyant, either over the historic election win under Boris Johnson, or Brexit being finally done.

This year many have simply not come, everything feels flat, and members can be heard loudly asking each other if they’ll even be in Government to deliver any policy announced.

On Sunday the Prime Minister had insisted the 45p income tax rate cut would go ahead, the Tory Chairman Jake Berry had threatened to oust MPs who voted against it, and a trail from Mr Kwarteng’s speech insisted it was “the right plan”.

With this in mind, the pressure on Mr Kwarteng was immense, with the Chancellor needing to deliver a big speech just hours after announcing an even bigger U-turn.

To make matters worse, this was not a plan leaked out, but one announced already and relentlessly defended.

MPs had told me they hoped for an explanation of the decision, a reasoning for the U-turn beyond it being a “distraction”, and something to take back control of the narrative.

Yet watching it in the conference centre in Birmingham, there was almost disbelief at the length of his speech, which clocked in at under 20 minutes.

Addressing the audience in Birmingham he acknowledged it had been a “tough” day and promised there would be no more distractions.

But he also failed to deliver any reassurance to those having mortgage deals withdrawn, dismissing the market chaos as a “little turbulence”.

He said: “It has been tough but we need to focus on the job in hand.

“We need to move forward, no more distractions, we have a plan and we need to get on and deliver it.”

Members had expected more policy or contrition, but instead got a speech light on both.

One MP text: “Was that it?”.

Activists within the party were more scathing, saying they were “expecting more” and things were “well past crisis mode”.

This came after a morning in which he had angrily dismissed criticism during an interview on the Today programme, saying “I’m telling you and I don’t think you’re listening”.

Downing Street said Prime Minister Liz Truss – who was in the audience for the speech – continues to have confidence in Mr Kwarteng, despite the humiliating decision to drop the tax cut.

Mr Kwarteng said he had “not at all” considered resigning despite scrapping a key part of the financial plans he set out on September 23.

But the knives are out, not just for the Chancellor, and it’s clear the blame game has already begun.

To make matters harder for the pair, they bypassed the cabinet with the initial announcement, and just made the decision themselves.

This puts the pressure more on them, with the Treasury and Independent Office for Budget Responsibility also bypassed.

Ms Truss will now deliver her own conference speech tomorrow morning, hoping to seize back control of the narrative.

This should be her honeymoon period, but letters are already going in to Graham Brady, and ministers are dropping out of events all over conference.

Even Nadine Dorries, who supported her leadership bid, is calling for a general election.

With MPs privately saying both will be gone by Christmas, the pair will need the speech of their lives to fix a problem of their own making.