Liz Truss was forced to slam the brakes on a planned public sector pay cut on Tuesday after her proposals for a "war on Whitehall waste" caused an outcry in the Conservative leadership race.
It capped a difficult day for the Foreign Secretary after her swipe at Scottish First Minister Nicola Sturgeon in a Tory leadership hustings led to a backlash north of the border.
A briefing war erupted as rival candidate Rishi Sunak's campaign team leapt on the pay row to say that nurses, police and the military would receive "less under Liz" — forcing Ms Truss to backtrack within 24 hours.
A statement said Ms Truss would abandon plans to reduce pay for civil servants working outside London after she was accused of betraying Tory promises to level Britain's north-south divide.
"Current levels of public sector pay will absolutely be maintained," it said. "Our hard-working frontline staff are the bedrock of society and there will be no proposal taken forward on regional pay boards for civil servants or public sector workers."
The U-turn was the first setback for the Truss campaign after a burst of momentum in which she opened up a healthy poll lead over Mr Sunak and won endorsements from a string of senior Tories, including former leadership rival Penny Mordaunt.
The two remaining candidates set out their economic plans at a hustings in Exeter on Monday as the party's roughly 200,000 members start to receive their ballot papers and decide who should succeed Boris Johnson as prime minister.
Conservatives on the campaign trail - in pictures
Ms Truss separately announced her plans to trim the civil service, often a bogeyman of Conservative MPs, by reducing annual leave and eliminating some of Whitehall's diversity officers in a push to tackle "left-wing groupthink".
She promised if elected to "run a leaner, more efficient, more focused Whitehall that prioritises the things that really matter to people and is laser-focused on frontline services".
Her proposals delighted Tory MP Jacob Rees-Mogg, a minister responsible for government efficiency, who said they would prevent money being wasted on the "woke indoctrination of civil servants".
But it was her suggestion that national pay scales should be replaced with regional ones, reflecting the cheaper cost of living outside London, that raised objections from Conservative and opposition MPs.
Critics said Ms Truss's promise of £8.8 billion ($10.7bn) in savings was wholly implausible unless she planned to go beyond civil servants and cut the pay of nurses, police officers and other public sector workers.
Ben Houchen, the Conservative mayor of the Tees Valley region and a prominent face of the party in northern England, described the policy as "a ticking time bomb set by team Truss that will explode ahead of the next general election".
"There is simply no way you can do this without a massive pay cut for 5.5 million people, including nurses, police officers and our armed forces outside London," he said.
Sam Freedman, a senior fellow at the Institute for Government, said: "Either someone has accidentally added a zero to the end of a calculation or they mean the entire public sector workforce.
"If it's an error, it's extremely embarrassing. If she's proposing to cut doctor and teacher pay, she's lost her marbles."
Allies of Mr Sunak accused Ms Truss of stale thinking by reviving a regional pay idea previously considered under the Tony Blair and David Cameron governments but ultimately dropped.
The Sunak camp put out its own calculations, suggesting that 5.7 million public sector employees would have their pay cut by an average of £1,500 ($1,830) a year.
Even after the U-turn was announced, some Tories objected to Ms Truss's claim that its policies had been "wilfully misrepresented" when the £8.8bn figure came from its own press material.
The plans also ran into fierce resistance from the opposition and civil service unions, with Labour deputy leader Angela Rayner saying: "This out-of-touch government's commitment to levelling-up is dead."
Sir Ed Davey, the Liberal Democrat leader, said: “U-turning on a multibillion-pound policy five weeks before even taking office must be a new record."
Ms Truss's problems did not end in the North of England, as political rivals in Scotland took umbrage at her remark that First Minister Nicola Sturgeon was "an attention seeker" who should be ignored.
Asked whether she would back a second independence vote advocated by Ms Sturgeon, Ms Truss channelled her political idol Margaret Thatcher by saying: "No, no, no."
Her comments won cheers in the all-Tory audience but led to criticism from Scottish nationalists who said she was belittling Scotland's position.
“Nicola Sturgeon has far more democratic legitimacy than Liz Truss is going to have if she becomes the prime minister," said Scottish Deputy First Minister John Swinney.
He told the BBC's Good Morning Scotland programme that people north of the border, regardless of political opinion, would be “really concerned, and in many cases, insulted” by the remarks.
Nikita Bassi, an aide to Ms Sturgeon, described the Tory candidate's remarks as "ignorant, shameful and out of touch".
But Mr Rees-Mogg defended Ms Truss on Sky News and said of Ms Sturgeon: "I think she’s very often wrong, she’s always moaning and we need to focus on how the union benefits people."
Nayanthara: Beyond The Fairy Tale
Starring: Nayanthara, Vignesh Shivan, Radhika Sarathkumar, Nagarjuna Akkineni
Director: Amith Krishnan
Rating: 3.5/5
Neil Thomson – THE BIO
Family: I am happily married to my wife Liz and we have two children together.
Favourite music: Rock music. I started at a young age due to my father’s influence. He played in an Indian rock band The Flintstones who were once asked by Apple Records to fly over to England to perform there.
Favourite book: I constantly find myself reading The Bible.
Favourite film: The Greatest Showman.
Favourite holiday destination: I love visiting Melbourne as I have family there and it’s a wonderful place. New York at Christmas is also magical.
Favourite food: I went to boarding school so I like any cuisine really.
'Downton Abbey: A New Era'
Director: Simon Curtis
Cast: Hugh Bonneville, Elizabeth McGovern, Maggie Smith, Michelle Dockery, Laura Carmichael, Jim Carter and Phyllis Logan
Rating: 4/5
How has net migration to UK changed?
The figure was broadly flat immediately before the Covid-19 pandemic, standing at 216,000 in the year to June 2018 and 224,000 in the year to June 2019.
It then dropped to an estimated 111,000 in the year to June 2020 when restrictions introduced during the pandemic limited travel and movement.
The total rose to 254,000 in the year to June 2021, followed by steep jumps to 634,000 in the year to June 2022 and 906,000 in the year to June 2023.
The latest available figure of 728,000 for the 12 months to June 2024 suggests levels are starting to decrease.
Uefa Nations League
League A:
Germany, Portugal, Belgium, Spain, France, England, Switzerland, Italy, Poland, Iceland, Croatia, Netherlands
League B:
Austria, Wales, Russia, Slovakia, Sweden, Ukraine, Republic of Ireland, Bosnia-Herzegovina, Northern Ireland, Denmark, Czech Republic, Turkey
League C:
Hungary, Romania, Scotland, Slovenia, Greece, Serbia, Albania, Norway, Montenegro, Israel, Bulgaria, Finland, Cyprus, Estonia, Lithuania
League D:
Azerbaijan, Macedonia, Belarus, Georgia, Armenia, Latvia, Faroe Islands, Luxembourg, Kazakhstan, Moldova, Liechtenstein, Malta, Andorra, Kosovo, San Marino, Gibraltar
Sustainable Development Goals
1. End poverty in all its forms everywhere
2. End hunger, achieve food security and improved nutrition and promote sustainable agriculture
3. Ensure healthy lives and promote well-being for all at all ages
4. Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all
5. Achieve gender equality and empower all women and girls
6. Ensure availability and sustainable management of water and sanitation for all
7. Ensure access to affordable, reliable, sustainable and modern energy for all
8. Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
9. Build resilient infrastructure, promote inclusive and sustainable industrialisation and foster innovation
10. Reduce inequality within and among countries
11. Make cities and human settlements inclusive, safe, resilient and sustainable
12. Ensure sustainable consumption and production patterns
13. Take urgent action to combat climate change and its effects
14. Conserve and sustainably use the oceans, seas and marine resources for sustainable development
15. Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss
16. Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
17. Strengthen the means of implementation and revitalise the global partnership for sustainable development
Background: Chemical Weapons
Sholto Byrnes on Myanmar politics
GCC-UK%20Growth
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RACE CARD
6.30pm Maiden Dh165,000 (Dirt) 1,200
7.05pm Handicap Dh165,000 (D) 1,600m
7.40pm Maiden Dh165,000 (D) 1,600m
8.15pm Handicap Dh190,000 (D) 1,600m
8.50pm Handicap Dh175,000 (D) 1,400m
9.25pm Handicap Dh175,000 (D) 2,000m
The National selections:
6.30pm Underwriter
7.05pm Rayig
7.40pm Torno Subito
8.15pm Talento Puma
8.50pm Etisalat
9.25pm Gundogdu
UFC%20FIGHT%20NIGHT%3A%20SAUDI%20ARABIA%20RESULTS
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More from Neighbourhood Watch
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
2017%20RESULTS%3A%20FRENCH%20VOTERS%20IN%20UK
%3Cp%3E%3Cstrong%3EFirst%20round%3C%2Fstrong%3E%3Cbr%3EEmmanuel%20Macron%3A%2051.1%25%3Cbr%3EFrancois%20Fillon%3A%2024.2%25%3Cbr%3EJean-Luc%20Melenchon%3A%2011.8%25%3Cbr%3EBenoit%20Hamon%3A%207.0%25%3Cbr%3EMarine%20Le%20Pen%3A%202.9%25%3Cbr%3E%3Cbr%3E%3Cstrong%3ESecond%20round%3C%2Fstrong%3E%3Cbr%3EEmmanuel%20Macron%3A%2095.1%25%3Cbr%3EMarine%20Le%20Pen%3A%204.9%25%26nbsp%3B%3C%2Fp%3E%0A
The specs
Engine: 2.0-litre 4-cyl turbo
Power: 201hp at 5,200rpm
Torque: 320Nm at 1,750-4,000rpm
Transmission: 6-speed auto
Fuel consumption: 8.7L/100km
Price: Dh133,900
On sale: now
Persuasion
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Who's who in Yemen conflict
Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government
Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council
Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south
Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory
Checks continue
A High Court judge issued an interim order on Friday suspending a decision by Agriculture Minister Edwin Poots to direct a stop to Brexit agri-food checks at Northern Ireland ports.
Mr Justice Colton said he was making the temporary direction until a judicial review of the minister's unilateral action this week to order a halt to port checks that are required under the Northern Ireland Protocol.
Civil servants have yet to implement the instruction, pending legal clarity on their obligations, and checks are continuing.