Liz Truss resignation: A timeline of turmoil

Elliot Gulliver-Needham

20th October, 2022

4 min read

Elliot Gulliver-Needham reviews the difficulties Prime Minister Liz Truss has experienced since she came to power.

3 March 2021

Former Chancellor Rishi Sunak announced a corporation tax rise from 19% to 25%, which would come into effect in April 2023.

7 July 2022

Boris Johnson resigns as UK prime minister following the resignation of 54 ministers, serving for under three years in office.

13 July - 2 September

Liz Truss and Rishi Sunak make it to the final round of the Conservative Party Leadership election.

5 September

Truss won the Conservative Party leader contest against Rishi Sunak, promising a "bold plan" to cut taxes, to grow the economy and "deliver on the energy crisis, dealing with people's energy bills but also dealing with the long-term issues we have on energy supply".

6 September

Truss became prime minister and appointed Kwasi Kwarteng as her chancellor.

8 September

Truss announced the energy price guarantee, which caps energy unit prices, freezing bills for an average household at £2,500 a year for the next two years.

Queen Elizabeth II died, which began a period of mourning that delayed the September meeting of the Bank of England's Monetary Policy Committee.

22 September

The Bank of England raised interest rates to 2.25%, a smaller hike than economists had been expecting.

23 September

Kwarteng made his Mini Budget without a forecast from the Office for Budget Responsibility.

He reversed the planned hike to corporation tax and dividend tax, while cutting National Insurance rates by 1.25%.

Kwarteng also removed the top 45p top rate of tax, while cutting the base rate of tax from 20% to 19%.

Stamp duty was also reformed, doubling the threshold before payment of it from £125,000 to £250,000. The threshold for first-time buyers was increased from £300,000 to £425,000.

Finally, Kwarteng introduced a VAT-free shopping scheme for non-UK visitors, while cancelling planned increased in alcohol duty rates.

Market reacted poorly to the fiscal event, with the pound plunging below $1.10 for the first time in 37 years, while gilt markets saw a major sell-off.

28 September

In response to turmoil in the gilt market, the Bank of England announced a temporary bond-buying programme, purchasing a maximum of £5bn in gilts every day.

Kwarteng continued meeting with bankers in an attempt to calm market sentiment.

3 October

Kwarteng announced the government would be abandoning the tax cut to the top rate of income tax.

10 October

Kwarteng brought forward the planned fiscal event, that would be accompanied by an OBR forecast, from 23 November to 31 October.

Meanwhile, the Bank of England expanded its bond-buying programme to allow the purchase of up to £10bn in gilts every day, extending the policy to index linked-gilts. The total amount would allow for daily totals of £5bn in conventional gilts and £5bn in index-linked gilts.

12 October

Truss ruled out any spending cuts to pay for the gap created by the unfunded tax cuts.

14 October

Kwarteng was sacked as chancellor, with Jeremy Hunt appointed in his place, making him the fourth Chancellor of the Exchequer in as many months.

Truss also announced that the government had scrapped the plan to reverse the corporation tax hike, and that corporation tax would rise to 25%.

Meanwhile, the Bank of England gilt buying operation came to an end.

17 October

Chancellor Jeremy Hunt issued a statement reversing almost all measures in the Mini Budget, including cutting the basic rate of income tax, freezes in alcohol duty and the VAT-free shopping scheme.

He also said the government would no longer be repealing the 2017 and 2021 reforms to the off-payroll working rules, also known as IR35.

Only the National Insurance cut and stamp duty cut remain as headline policies, with more detail set to come in the chancellor's speech to parliament later this afternoon.

19 October

Home secretary Suella Braverman resigned, while both the chief whip and deputy chief whip resigned before rescinding their resignations following a controversial vote in the House of Commons to ban fracking.

Meanwhile, Truss said that the state pension's triple lock would remain in place after suggesting it should be scrapped, confirming that the pension will rise 10% with inflation.