Prime Minister Liz Truss admits mistakes over mini-budget but stands by tax-cutting plan

Liz Truss has acknowledged mistakes over the tax-slashing mini-budget but said she was standing by her plans.

The Prime Minister refused to rule out public spending cuts as she admitted more could have been done to prepare the financial markets for Kwasi Kwarteng’s statement.

The chancellor’s “fiscal event” spooked markets and sent the pound plummeting to a record-low forcing an unprecedented £65bn intervention by the Bank of England.

Truss revealed the mini-budget’s most controversial measure, the abolition of the 45% tax rate on earnings over £150,000 was not discussed with the Cabinet but was a decision made by the chancellor.

As the Tory conference gets under way in Birmingham, Truss faced a difficult task in reassuring the markets and Conservative members unnerved by the market turbulence and opinion poll crash suffered since she took office.

“I do want to say to people I understand their worries about what has happened this week,” she told the BBC’s Sunday With Laura Kuenssberg.

“I do stand by the package we announced and I stand by the fact we announced it quickly, because we had to act.

“But I do accept we should have laid the ground better… I have learnt from that and I will make sure that in future we do a better job of laying the ground.”

The chancellor is facing calls for an official inquiry following a report that he attended a private champagne reception with hedge fund managers who stood to gain from a collapse in sterling following his mini-budget.

The Sunday Times reported that he joined the gathering at the Chelsea home of a City financier on the evening of September 23 where he was said to have been “egged on” to commit to his plan for £45bn of unfunded tax cuts.

Truss said Kwarteng “meets business people all the time” when asked about the incident.

Conservative donors who attended a champagne reception with the Chancellor after his mini-budget should be “lauded”, the party chairman has said.

A source close to the chancellor dismissed any suggestion of impropriety regarding his attendance at the reception saying any suggestion attendees had access to privileged information was “total nonsense”.