Truss is gone. The Conservatives still have to govern.

Liz Truss told the country she could no longer deliver the mandate on which her party had elected her. Standing outside Downing Street on 20 October, just over six weeks after becoming prime minister, she announced that she would resign once a successor was chosen. Her principal economic programme had already been dismantled. The final question was whether the Conservative Party could replace its leader faster than the government’s authority was deteriorating.

It did. Rishi Sunak became Conservative leader on 24 October after his remaining rival, Penny Mordaunt, withdrew. King Charles III asked him to form a government the following day. Britain had its third prime minister of the year, with the same parliamentary majority returned at the 2019 election and a sharply different account of what that majority was supposed to do.

Sunak’s first address acknowledged errors under Truss and promised economic stability. Jeremy Hunt remained chancellor, preserving continuity with the reversals he had announced a week earlier. The new administration then moved the fiscal statement from 31 October to 17 November so that the prime minister and chancellor could prepare their plans alongside an Office for Budget Responsibility forecast.

The speed of the transition ended the leadership contest. It did not settle the questions that brought the previous administration down: how to finance energy support, reconcile tax policy with borrowing costs and maintain party discipline when economic choices become unpopular. Sunak has inherited a government with enough seats to legislate. October demonstrated how little comfort that arithmetic provides when the programme loses credibility.

The economic programme fell before the prime minister

Truss and her first chancellor, Kwasi Kwarteng, had presented their Growth Plan on 23 September. It combined large tax reductions with extensive energy support and an argument that lower taxes and supply-side reform would improve the economy’s long-term performance. The announcement came without a new OBR forecast setting out the implications for growth and the public finances.

The absence mattered because the government was asking investors to accept a substantial change of direction at a time of high inflation and rising global interest rates. A promise of stronger future growth could not by itself answer questions about the scale of borrowing or how debt would be stabilised. The market reaction quickly became a political problem because it reached beyond traders to pensions, mortgages and the government’s own financing.

On 28 September, the Bank of England announced temporary purchases of long-dated government bonds to restore orderly market conditions. The intervention addressed dysfunction in the gilt market and risks to financial stability. It was separate from the Bank’s monetary-policy decisions on inflation, even though the two operations could look contradictory to people watching the central bank tighten policy and buy bonds at the same time.

Pension-related investment strategies were under pressure as bond prices moved sharply and funds faced demands for additional collateral. Selling assets to meet those demands could intensify the price falls. The Bank’s purchases were intended to interrupt that process and provide time for adjustment. They were not an endorsement of the government’s fiscal programme or an unlimited promise to hold borrowing costs down.

The government began retreating before the rescue operation ended. It abandoned the planned abolition of the 45 per cent additional income-tax rate. On 14 October, Truss dismissed Kwarteng, appointed Hunt and accepted that corporation tax would rise to 25 per cent in April, reversing another central commitment. The Bank’s temporary bond purchases ended that same day on the timetable it had announced.

On 17 October, Hunt went further. He reversed almost all the Growth Plan tax measures that had not already been legislated for and shelved the proposed reduction in the basic income-tax rate. Changes to dividend taxation and tax-free shopping for overseas visitors were among those withdrawn. The government’s remaining programme now depended on its new chancellor explaining why the previous programme could not be afforded.

Hunt also shortened the period for which the existing household energy guarantee would apply universally, announcing a review of support beyond April 2023. That changed the political promise from a broad two-year shield to a shorter arrangement followed by a more targeted policy. Households and businesses still faced uncertainty over the support they would receive after the review.

The sequence deprived Truss of a usable account of her premiership. She had won the leadership arguing for a decisive break with Treasury orthodoxy. Her chancellor was now restoring fiscal discipline by cancelling the measures through which she had proposed to make that break. Keeping her in office would have required the party to defend a leader whose main policy choices had been rejected by her own government.

The last Wednesday exposed the loss of control

The final parliamentary crisis came on 19 October. Home Secretary Suella Braverman resigned after acknowledging that she had sent an official document from a personal email account, while also criticising the government’s direction. Her departure opened another front in a cabinet that had already lost its chancellor. The issue was no longer confined to whether a particular tax measure would survive.

That evening, Labour used an opposition-day motion to seek control of Commons time for legislation banning fracking. The government opposed the motion and treated party discipline around it as a test of support. Conservative MPs who opposed fracking in their constituencies were consequently being asked to separate their position on the underlying policy from their loyalty to the administration.

Conflicting messages over whether the vote was a confidence matter compounded the problem. During the debate, minister Graham Stuart said it was not. The public parliamentary record captures the confusion without requiring assumptions about every conversation outside the chamber. MPs were voting on a procedural motion while arguing over whether their careers and the prime minister’s future were also at stake.

The government defeated Labour’s motion by 326 votes to 230. That victory did not restore authority. A comfortable division result accompanied visible disorder over whipping and the government’s intentions. As with the fiscal reversals, the formal outcome could not conceal the political condition in which it had been achieved.

By the next morning, the leadership question had become unavoidable. Truss met Sir Graham Brady, chair of the Conservative backbench 1922 Committee, and announced her intention to step down. Her statement said a leadership election would be completed within a week. This compressed timetable acknowledged that another summer-length contest would prolong uncertainty while the government was trying to repair its financial credibility.

The party set a high nomination threshold: candidates needed the backing of 100 Conservative MPs. Boris Johnson explored a return but withdrew. Mordaunt, the Commons leader, continued until the final day before ending her campaign. Sunak was the only candidate to clear the process, which meant party members did not repeat the ballot that had selected Truss in September.

The result reversed the summer contest through a different electorate. Sunak had warned during that campaign about borrowing-funded tax cuts and had lost the membership vote. In October, parliamentary colleagues selected him as the figure best placed to restore stability. That gave him a clear political argument for changing policy, but it also left supporters of the earlier programme inside the party he now had to lead.

A new leader, the same Commons

Sunak’s appointment followed Britain’s parliamentary system. The monarch asks a person able to command Commons confidence to form an administration. A change of prime minister does not automatically require a general election. The Conservative majority therefore gave the party the ability to replace its leader and remain in government, even after two such transitions within a few months.

Labour’s demand for an election addressed political legitimacy rather than a missing constitutional procedure. Its argument was that repeated leadership changes were producing programmes the electorate had never directly endorsed. Sunak responded by locating his government within the Conservatives’ 2019 mandate. The disagreement is about how far a governing party can change course while relying on the same parliamentary authorisation.

The distinction is especially uncomfortable because the 2019 victory was built around Boris Johnson, Brexit and a promise to improve public services and opportunities beyond prosperous parts of the country. Truss then pursued a different economic strategy. Sunak must explain how the measures needed to stabilise the finances fit the promises on which many of his MPs were first elected.

His cabinet appointments indicate an effort to hold several parts of the party together. Hunt’s retention reassured those looking for continuity in fiscal policy. Braverman’s return to the Home Office reopened questions about judgment and information handling while giving a prominent figure on the right a place in the new administration. Coalition management inside a majority party can be as demanding as negotiation between separate parties.

The immediate difficulty is that fiscal credibility and party reassurance may pull in different directions. MPs can agree that Truss’s programme failed without agreeing which taxes should rise, which budgets should be constrained or how much help households should receive. Hunt’s November statement will turn a shared desire for stability into choices that create identifiable winners and losers.

The return of an OBR forecast is relevant because it exposes assumptions to scrutiny. The watchdog does not choose the government’s tax rates or give ministers permission to spend. It estimates the economic and fiscal consequences of their decisions, allowing Parliament and investors to compare the programme with the government’s stated rules. September left that comparison unavailable at the moment it was most needed. November’s exercise will restore it, but the existence of a forecast alone cannot make a weak policy credible. Ministers will still have to explain their assumptions, accept uncertainty in the projections and show how they would respond if growth or borrowing costs disappoint.

Sunak will also need to distinguish the problems created by September’s policy decisions from those already facing the economy. Global energy prices, inflation and higher international interest rates predate Truss. Reversing her measures cannot reverse all their effects on household living standards. Claiming otherwise would set an expectation the new government could not meet.

Mortgage borrowers make that limitation particularly visible. A calmer bond market does not instantly restore every lending product withdrawn during the turmoil or erase the higher payment facing a household whose fixed-rate deal expires. The political consequences can therefore continue after the acute market crisis subsides. A change of prime minister is immediate; the repair of public confidence is slower.

Europe will meet a government with less room to improvise

For European partners, Sunak’s arrival offers a prospect of more predictable economic management. It does not automatically resolve the disputes inherited from Johnson and Truss. The Northern Ireland Protocol remains contested, and UK legislation seeking unilateral changes continues to complicate relations with the EU. A more orderly Downing Street still has to decide what compromise it can carry through its own party.

Support for Ukraine has broad continuity across the leadership changes. Britain remains an important military and diplomatic partner for Kyiv. The practical question is whether commitments on defence and assistance can be maintained alongside the fiscal choices now being prepared. International partners will look at allocations and delivery schedules as well as statements of solidarity.

The episode also limits a familiar political claim that a government can treat market constraints as merely an objection from its domestic opponents. Britain retains control of its currency and its tax choices. It still has to persuade people to hold its debt on terms compatible with those choices. That requirement became visible through the interaction of government borrowing, pension funds and household credit.

By the end of October, the immediate transition is complete. Sunak is in office, Hunt is preparing a statement with independent forecasts and the Bank’s emergency bond-purchase operation has ended. What remains open is the governing bargain: which fiscal choices the Conservatives will support and what public justification Sunak can offer for them.

Truss’s resignation was unusually fast, but the cause was not a single bad speech or one lost division. Her government lost credibility in sequence: first over the financing of its programme, then over its ability to defend that programme, and finally over whether ministers and MPs would follow its instructions. Sunak’s first task is to rebuild those connections before asking the same majority to vote for the next difficult decision.