Truss Faces New Peril As Tories Go On The Attack Over Economy

PM accused of 'trashing' party values amid calls to reverse more tax cuts

- Jessica Elgot, Peter Walker, Pippa Crerar

Liz Truss's leadership was in fresh peril yesterday with calls growing among senior Conservatives to reverse more proposed tax cuts and MPs accusing her of "trashing" Conservative values.

As the cost of government borrowing soared further, Truss used her second PMQs appearance to "absolutely" rule out further spending cuts, instead allowing borrowing to rise over the next few years.

The remarks failed to calm the markets. The price of 20-year UK bonds hit new lows yesterday afternoon after the Bank of England insisted its £65bn package of support for the bond market would end tomorrow.

On the day of the prime minister's first parliamentary showdown since Conservative conference, MPs renewed serious conversations about the prospect of replacing her.

Truss has pledged to increase engagement with restive MPs with a series of round-table meetings over the next week. No 10 has publicly denied there is any new examination of the tax cuts announced at the mini-budget, including tweaks to the timing of the income tax cut or a re-evaluation of the cancelled corporation tax rise.

The former chancellor Sajid Javid and the chair of the Treasury select committee, Mel Stride, both voiced fears about the current approach and suggested the Treasury would need to look again at the measures announced by Kwasi Kwarteng.

At a meeting of the backbench 1922 Committee, MPs described her performance as "just appalling" and raised serious concerns about mortgage rates and the state of the polls showing a hefty Labour lead.