Kwasi Kwarteng suggests champagne reception was a mistake after confirming U-turn on 45p tax rate plan – live

Q: Have you considered your position?

Not all all, Kwarteng says.

Q: Why not?

Because he is focused on the growth plan, Kwarteng says.

Robinson says that is not a proper answer.

Q: Economist say the mistake you made was taking markets by surprise, sidelining experts like the permanent secretary and the OBR and rubbishing the Bank of England.

Kwarteng says he has never rubbished the Bank of England.

Robinson says the Liz Truss campaign, that Kwarteng supported, constantly argued the Bank of England had got things wrong.

Q: You presented your mini-budget, having sacked your permanent secretary, without consulting the Office for Budget Responsibility.

Kwarteng says the government had to act quickly.

Q: Will there be further tax cuts, as he said on Laura Kuenssberg’s show eight days ago.

Kwarteng says the government will present his spending plans, and then have a budget.

Q: There are 51 days until the medium-term fiscal plan. But the markets can react in hours. Will you cut spending to fund your tax cuts.

Kwarteng says he is committed to the spending review of 2021.

Q: That means you will not spend more on departments, to compensate them for inflation. That means they will have to find around £18bn to compensate for higher inflation.

Kwarteng says it is important to stick within the envelope of the CSR – the comprehensive spending review.

Q: You said after the mini-budget “the markets will react as they will”. Doesn’t that mean there is a Kwarteng premium on mortgages?

Kwarteng accuses Robinson of presenting a one-sided view of reality.

He says international factors are behind the interest rate moves.

He says Robinson is not presenting “a full picture of reality”. He suggests Robinson has not been listening to him.

The Federal Reserve has been ahead of other central banks in raising interest rates. That is why there is a strong dollar. Other banks have had to follow.

Q: Are you claiming your measures had nothing to do with the market reaction?

Kwarteng says he is saying international factors were relevant.

Q: Why did you sack Tom Scholar as permanent secretary at the Treasury?

Kwarteng says he will not comment on personnel matters. But he says he has praised Scholar’s record as a civil servant.

Kwasi Kwarteng is being interviewed by Nick Robinson on the Today programme.

Kwarteng starts by challenging Robinson’s claim that the Bank of England has had to spent £65bn. It is a facility allowing spending up to that, he says.

Q: If the 45p rate is a distraction now, why wasn’t it yesterday, when the PM said she was committed to it?

Kwarteng says they were absorbing information all the time.

He says “we’ve decided, I’ve decided” not to go ahead with the 45p rate.

Robinson quotes from the trail of Kwarteng’s speech later today released overnight. (See 7.27am.) You have been forced into a U-turn.

Kwarteng says they were listening.

Q: Do you still think it would be good to abolish the 45p rate. Are you only dropping it because you would not get it through?

Kwarteng says they have listened, and decided not to go ahead with it.

Q: The PM said yesterday it was your policy.

Kwarteng suggests Liz Truss, in her comment yesterday, was just making the point that the chancellor is in charge of budgets.

He says she agreed with the policy.

Rachel Reeves, the shadow chancellor, says the U-turn has come too late, because the mini-budget is already leading to higher mortgages for families. In a statement, she said:

The prime minister has been forced to abandon her unfunded tax cut for the richest one percent - but it comes too late for the families who will pay higher mortgages and higher prices for years to come.

The Tories have destroyed their economic credibility and damaged trust in the British economy.

There’s no plan to clear up the mess of 12 years of Tory government. They’re making it up as they go along.

This is not over – – it’s not just some distraction.

The Tories need to reverse their whole economic, discredited trickle down strategy.

Their kamikaze budget needs reversing now. As the party of fiscal responsibility and social justice, it will come to the Labour party to repair the damage this Tory government has done.

Q: How did you feel about the attack on you at the Labour party?

It was astonishing, Kwarteng says. In the Labour party you have to be the right sort of black person.

The LBC interview is now over.

Today is next, at 8.10am.

Kwarteng repeats the point about listening to people.

Ferrari says LBC spoke to people in Kwarteng’s Spelthorne constituency in Surrey at the weekend. Some said they would have to go to the pub this winter in the evenings because they could not afford to heat their homes.

Kwarteng says that is why the government introduced the energy package.

Q: Will there be more U-turns? Will you abandon the plan to lift the cap on bankers’ bonuses?

Kwarteng says he is “totally focused” on the growth plan.

Q: Grant Shapps said you were tin-eared.

Kwarteng says he is not tin-eared. He has been listening.

Q: Why did you go to a party with hedge fund managers after the mini-budget?

Kwarteng says it was an event organised by the Conservative party. He was only there for about quarter of an hour, maybe more.

Q: Do you regret going?

Kwarteng replies:

With hindsight it probably wasn’t the best way to go.

Q: Will there be more austerity measures?

Kwarteng replies: “I don’t think so at all.” He is focused on growth, he says.

Q: What was the reasoning for this?

Kwasi Kwarteng says they talked to people. “I totally get it.” He says he thought the 45p rate abolition had become a distraction.

He spoke to MPs, councillors and people in the country.

This was a huge distraction. “So I decided, along with the prime minister, that the best thing to do would be simply not to proceed with the abolition of the rate.”

Q: In other walks of life you would be sacked.

Kwarteng does not accept that. He says it is good to learn from your mistakes.

Q: But the Bank of England had to spend £65bn intervening to compensate for the turmoil this created.

Kwarteng does not accept that. He says the plan to abolition of the 45% top rate of tax was not what triggered the need for that.

Kwasi Kwarteng is about to be interviewed by Nick Ferrari on LBC.

Q: What else are you going to U-turn on? Will you bring forward the publication of the medium-term fiscal plan, due towards the end of November?

Kwarteng dodges the question, but he says he is “very pleased” the decision has been taken not to go ahead with abolishing the 45% top rate of tax.

Q: You make it sound like it was not your idea?

Kwarteng says: “I’ve said to take responsibility for it.”

The BBC Breakfast interview is over.

Q: Do you admit it was a mistake?

Kwarteng replies:

What I admit was that it was a massive distraction on what was a strong package.

Q: Liz Truss said she was prepared to take unpopular decisions. But she has buckled.

Kwarteng says the government has taken many tough decisions.

Q: Should you have listened much, much earlier?

Kwarteng says we can always have a debate about timing. He says the point now is to move on.

Q: Rishi Sunak warned these policies would be a mistake during the campaign.

Kwarteng says Liz Truss campaigning on not going ahead with the corporation tax rise and reversing the national insurance increase. Those policies are being implemented, and they have been welcomed.

He says there was a strong set of measures. He goes on to say “the prime minister decided not to proceed with the abolition [of the 45p rate]”.

Q: So it was her decision?

Kwarteng says they talked, he said this was what he was doing to do, and they agreed it.