Rishi Sunak is being talked up by MPs as the best solution for their party’s crisis, given he would be well placed to win back market confidence. “He is the only candidate who would save people 1% on their mortgages,” says a senior Tory. “That’s worth a lot right now.”

Yet Boris Johnson loyalists will fight efforts to install Sunak, given many still blame him for Johnson’s downfall. Look how Nadine Dorries has warned that changing leader again would mean a general election.

It’s the fear of a general election that is focusing minds. Few believe the party will win a fifth term – whoever leads them. Instead, the aim is to limit losses; to make sure the party’s defeat is not one that puts it out of power for a generation or more.

And while it remains very unlikely that Tory MPs would vote for an election, there is a worry that the public mood could turn towards one unless things stabilise. A Tory strategist warns that the window is narrowing when it comes to the public mood: “There is a risk the public see the turmoil and turn in favour of one.”

“The more chaotic and mad it is, the more likely we head to election territory,” says a party old hand. “This is why something has to happen soon.”

Doctors have rounded on the health secretary, Thérèse Coffey, after she admitted to sharing prescription medicines with others, actions the British Medical Association described as both dangerous and against the law.

Coffey told civil servants in a meeting last month that she had given leftover antibiotics to a poorly friend, an admission that came as the discussion on how to alleviate pressures on struggling GPs moved on to public behaviour around antibiotics.

Coffey’s comments provoked despair and disbelief among medical professionals who fear that members of the public might reach the false conclusion that it is safe and lawful to share unused medicines because the secretary of state had done so. One doctor accused Coffey of “monumental stupidity”.

Monday will be a crucial day for the prime minister. If sterling heads towards parity with the dollar and rising bond yields put upward pressure on mortgage rates, Truss may soon be handing in her resignation to King Charles.

The signs are that the U-turns, the sackings and the reassurance won’t be enough.

The Bank of England bond-buying scheme came to an end on Friday and Threadneedle Street is in no mind to restart it. Its intervention was all about providing pension funds with breathing space and it now believes they are more resilient as a result.

The test for further Bank action is whether there is financial instability – a systemic threat – not whether there is market instability.

Governments must “do more than people expect” during times of economic crisis, the former chancellor Alistair Darling has said.

Darling, who oversaw the Labour government’s response to the 2008 financial crash while chancellor between 2007 and 2010, said capability to manage the current economic turmoil is “completely absent”.

Telling BBC Scotland’s Sunday Show that what happened in 2008 “was not self-inflicted,” he added:

It was in continental Europe and the European Union, it was in America, it was right across the world. We were ready. We were prepared. We had a plan. We didn’t have to consult anybody else because we had our own currency, our own central bank, we could do this.

He accused the UK government today of “trashing” the Bank of England and failing to engage with the international community.

Lawyers have accused the UK of facilitating dangerous onward boat journeys by Tamil refugees who had arrived at the British-claimed territory of Diego Garcia in distress.

Fishing boats that fled Sri Lanka were escorted to the Indian Ocean island after getting into difficulty but were later permitted to leave on the same vessels without basic safety equipment, putting passengers – including children – at “grave risk”, lawyers have claimed.

One boat, carrying 46 people, ended up on the French territory of Réunion after three weeks at sea while another, carrying 35 people including an 18-month-old child, had to be escorted back to Diego Garcia due to a failed engine but has since been allowed to leave again, they say in legal letters to the government.

ITV’s political editor, Robert Peston, says he has been taking soundings from Tory MPs and there is gathering consensus that Liz Truss will have to step down.

He adds that there are two or possibly three credible candidates: Rishi Sunak, Penny Mordaunt and – “if he wants it” – the defence secretary, Ben Wallace.

Theres’s been a lot pick-up from Labour people on Tesco chairman John Allan earlier describing the party as “the only team on the field”.

Speaking on BBC One this morning, he said:

Frankly I don’t think we have seen a growth plan from the Conservatives, as I hope we will.

We have seen the beginnings, I think, of quite a plausible growth plan from Labour, so at the moment their ideas are on the table and many of them are actionable and attractive, and I wait to hear what the government has to say in due course, but at the moment there really is only one team on the field.

It was music to the ears of Labour supporters such as Kevin Maguire, who tweeted “every little helps” while others wondered if Allan might now be considered part of Liz Truss’s “anti growth coalition”, an increasingly crowded grouping, it seems.

Here is clip of the Tory MP Crispin Blunt – apparently the first Conservative MP to say publicly that it was time for Liz Truss to step down – telling Channel 4’s Andrew Neil that “the game is up” for the prime minister.

Asked how the party will get rid of her, he said: “If there is such a weight of opinion in the parliamentary party that we have to have a change, then it will be effected.

“Exactly how it is done and exactly under what mechanism ... but it will happen.”

BBC Newsnight’s Nick Watt, formerly of this parish, points out that Blunt was the first senior Tory to call on Iain Duncan Smith to resign back in 2003. Here’s a trip down that particular memory lane:

The business secretary, Jacob Rees-Mogg, has been accused of launching a “power grab” as new legislation proposes to hand sweeping control over the energy industry to the government.

The government last week introduced the energy prices bill to parliament to formalise the energy price guarantee, Liz Truss’s flagship policy to reduce household bills by limiting the cost of electricity and gas for two years.

However, the Guardian understands that energy suppliers have raised concerns with the business department that the legislation contains proposals for the government to be able to effectively overrule Ofgem, the sector’s independent regulator.

Labour has accused Avanti West Coast and ministers of risking chaos over Christmas after it emerged the rail operator’s new contract gives no guarantees on improved weekend services, and with tickets unavailable for booking over the festive period.

The shadow transport secretary, Louise Haigh, has written to the government seeking assurances about weekend travel along the hugely busy west coast mainline, saying the current situation was “staggering”.

The rail operator had its contract to run trains between London, Birmingham, Manchester, Glasgow and Edinburgh extended earlier this month on a short-term basis until April, but was told it must “drastically improve services” after a major contraction of its timetable.

New Labour attack adverts that seek to capitalise on the link between the government’s mini-budget and the shock being felt by members of the public when it comes to things like mortgage rates have sparked a mixed reaction

Ellie Mae O’Hagan, previously director of the Centre for Labour and Social Studies (Class) and now at the Good Law Project, isn’t sure about them:

The new posters, drawn up by Labour’s advertising agency, Lucky Generals, include one accusing the government of leaving “Britain’s reputation in tatters” alongside a picture of a shredded union jack.

Another has the slogan “Your mortgage is going through the roof” incorporated into an image of a huge hole in a roof.

A third poster shows Truss and the new chancellor, Jeremy Hunt, dressed up as clowns, alongside the message: “Send off the clowns.”

Benedict Pringle, an advertising professional, also tweeted his thoughts on the adverts, saying: “They all feature tight copywriting & nice visual metaphors for either (a) the economic catastrophe that the Tories have unleashed or (b) the government diminishing the country’s reputation on the world stage.”

But he added: “The craft in the execution of the ads looks a little loose to me, which makes me think these aren’t intended to run as final posters.”

Another communications professional, Andrew Brightwell, reckoned:

Asked about the winter the UK was facing and the cost of living crisis, the archbishop of Canterbury told the Guardian that the diocese food bank was already overwhelmed.

Welby, an old Etonian former oil trader who is currently in Australia touring areas most affected by climate change, directly addressed the question of tax cuts for the wealthy during his Guardian interview:

I’m not going to make a party political point because both parties are deeply divided and I’m not going to talk about Australia because I just don’t know the situation. But in the UK, the priority is the cost of living, with the poorest.

And from an economics point of view, I’m deeply sceptical about trickle-down theory. You know, if you cut money for the rich, ever since Keynes wrote his general theory in 1936, whenever it was, he showed very clearly that the rich save if they’ve got enough to live on.

So if you want to generate spending in the economy, you put more money into the hands of those who need the money to buy food, to buy goods, to buy basic necessities.

The general secretary of the Royal College of Nursing has warned Chancellor Jeremy Hunt against making cuts to the Department of Health’s budget.

Hunt has signalled that all departments will be forced to find more savings and cut costs as the Government seeks to restore market credibility.

But Pat Cullen of the RCN said:

If the new Chancellor is serious about spending money more wisely, then he must invest in the nursing workforce.

Asking the Department of Health to make yet more efficiencies - in other words, to cut costs - when the need to invest in the NHS and social care is greater than ever, does not make sense.

A nursing workforce crisis was undermining safe patient care, with many choosing to leave the profession for better-paid jobs elsewhere, added Cullen, who said that “the need to pay a demoralised and unvalued profession fairly could not be more pressing.”

Needless to say, relations between the new chancellor and NHS workers come with a particular backstory.

The Irish taoiseach, Micheál Martin, has said that opportunities to tackle sectarianism and disadvantage have not been taken since the signing of the Good Friday agreement in 1998.

Martin said the sad reality is that “far too little has been done” to meet some of the key objectives of the historic peace agreement, which will reach its 25th anniversary next year.

PA Media reports that Martin was addressing his party’s annual commemoration of Wolfe Tone in Co Kildare.

Martin said a key objective of the negotiations which led to the Good Friday agreement was “to remove the causes of conflict, to overcome the legacy of history, and to heal the divisions which have resulted”. He added:

The sad reality is that nearly a quarter of a century later, far too little has been done. Too much time has been wasted. Too few have been willing to undertake the basic work of questioning themselves and finding ways to build a shared respect across historic barriers.

Opportunities to tackle disadvantage and to tackle sectarianism have not been taken, and remain unfulfilled. There has been a lot of talk about unity and reconciliation but very little work done to actually build the bridges which make it happen.

The leader of one of Britain’s biggest trade unions, Unite, has said co-ordinated strike action could happen later this year – with as many as 1 million people walking out over pay and conditions.

Speaking on Sky News’s Sophy Ridge on Sunday programme, the Unite general secretary, Sharon Graham, said: “Well, yes, I said yesterday that I think there could up to a million people on strike very, very soon.”

She also urged Labour to set out what it stands for and said it would be unacceptable for Keir Starmer’s party “just to sit on the sidelines”. Graham said:

Labour have a real opportunity now and they need to take that opportunity. There is clear blue water opened up on the political horizon, there’s no doubt about that, but this is not a moment to play safe, this is not a moment to say OK, they’re doing so badly we just have to sit on the sidelines here. This is the moment to take this by the scruff of the neck, to say this is what we need to do, to come up with a solution to these problems and to really lay out what Labour’s stall is. Get some mettle, lay out your stall and say what people should vote for not just what they should vote against.

I don’t think it is acceptable just to sit on the sidelines and have just a little bit of difference. You can’t get in just because you are a little bit better than the other lot, that isn’t the way.

The new chair of the Commons foreign affairs committee has said she will visit Taiwan later this year.

Alicia Kearns told Times Radio:

When I first was elected to the committee back in March 2020 I said that our first visit should be to Taiwan.

I want to make clear to anyone who is listening who is absolutely of the view that we need to not antagonise China, that the reason for visiting Taiwan is to understand what’s going on in Taiwan, to understand the crisis, to understand the relationships.

Challenged on how such a visit would be seen in Beijing, Kearns said: “It’s their choice. What they did with the [US House speaker Nancy] Pelosi visit was they decided to make it such a big dramatic event. They could have chosen to ignore it. They could have played it down. But they didn’t, they tried to weaponise it.”

Joe Biden has called Liz Truss’s abandoned UK tax cut plan a “mistake” and said he is worried that other nations’ fiscal policies may hurt the US amid “worldwide inflation”.

Biden said it was “predictable” that the new British prime minister was forced on Friday to walk back plans to aggressively cut taxes without identifying cost savings, after Truss’s proposal caused turmoil in global financial markets.

In a two-page spread where the headline “Tory Death Cult” looms large, the Sunday Times has some excellent detail about how Sajid Javid was reportedly sounded out weeks ago about taking over as chancellor from Kwasi Kwarteng.

Someone described as “one ally of Javid” [cough] told Caroline Wheeler and Harry Yorke: “Sajid would have only done it if he had complete control.”

The piece adds that three sources familiar with the discussions said Javid had insisted on full autonomy over tax-and-spend policies, freedom to appoint his own political team and the reinstatement of Sir Tom Scholar, the veteran Treasury permanent secretary who was sacked by Kwarteng and Truss on their first day in office.

The last ask may well have been the most controversial. But either way, Javid was said to be no longer in the running, with Truss and co shifting their attentions to figures such as Jeremy Hunt.

The Sunday Times also carries a quote from a No 10 sources that has really angered other Conservatives, including Robert Halfon, who was particularly scathing when asked about it by Sophy Ridge on her Sky News programme this morning

The No 10 source, reports the Sunday Times, denied that Javid had ever been considered for the role now filled by Hunt, adding:

The prime minister laughed out loud at the suggestion. She has sat in the cabinet with Javid for 10 years and she knows who is good and who is shit.

Halfon said that if the prime minister wanted to unite colleagues around her then “these kind of negative briefings have got to stop”.

Halfon added:

It’s disgusting. Sajid Javid is a respected and good and decent man. He’s had a number of offices, the secretary of state, and just to call him four-letter words, all it does is bring disharmony to the party when what the prime minister should be doing is doing everything possible to bring people together, bring the country together. It is just absolutely unnecessary and uncalled for.

Labour figures, such as MP Bill Esterson, were also zeroing in on the anonymous quote:

Ministers are pressing ahead with a dual crackdown on climate protests and strike action, a controversial move that followed a day of direct action in London including clashes with the public and milk poured on the floor of Harrods.

The home secretary, Suella Braverman, will unveil plans today to grant police new powers to take a more “proactive” approach to counter tactics favoured by climate activists such as Just Stop Oil and Extinction Rebellion.

Confirmation also arrived that the government is pursuing legal moves to introduce minimum service levels during strikes by transport workers after months of industrial action by railway workers in disputes over pay, jobs and conditions.

The developments came against a backdrop of protests in east London. Nearly 30 demonstrators from Just Stop Oil gathered on Shoreditch High Street shortly after noon on Saturday where they set up a road block to disrupt traffic.

The group, who are calling for the government to halt all new oil and gas extraction licences, glued themselves to the tarmac, prompting angry responses from motorists.

Responding to Jeremy Hunt’s comments that every department, including the NHS, faces cuts, the Liberal Democrat Treasury spokesperson Sarah Olney MP has reiterated her leader’s calls for a general election.

She said in a statement:

This Conservative party has trashed the economy, hit millions of people with mortgage hikes and presided over a national humiliation. Now they are promising cuts that will break our public services and deliver further pain for millions of people who are struggling.

The Labour frontbencher Jonathan Reynolds also joined the calls for an election, telling GB News that it was the only “logical way forward”. He added:

The mini-budget was clearly the start of this. The cost of government borrowing spiked by an incredible amount in the three trading days after those announcements were made. But the fact is, the damage has now been done. And I honestly cannot see how any Conservative can turn this around. Of course, as a Labour MP, I want a general election.

The Conservative MP Alicia Kearns said the question of whether Liz Truss should continue as prime minister is “incredibly difficult”.

Asked on Times Radio if Truss could or should survive in No 10, Kearns, the new chair of the Commons foreign affairs committee, sighed and said:

Ultimately it is a very difficult one because, I think, you know, we’ve had the questions around our moral competency. We’ve now got questions around our fiscal competency.

I don’t want further questions around even our ability to continue to govern as a party and our ability to stay united. It’s an incredibly difficult one, and ultimately I need to listen to colleagues and speak to colleagues over coming days. But do we need a fundamental reset? Without question.

This morning’s Sunday newspapers have been full of talk about the potential heave which many expect to come very soon against Liz Truss, as well as the actions which her government is likely to take to attempt to shore up support.

The Sunday Times reports that the new chancellor, Jeremy Hunt, is to delay the penny cut to income tax – the flagship announcement in the disastrous mini-budget – as ministers warn that Liz Truss’s time is up and backbenchers plot to oust her.

In the latest in a series of U-turns, the new chancellor is expected to announce that plans to reduce the basic rate of income tax next April will be delayed by a year.

The Mail on Sunday reports that the defence secretary, Ben Wallace, has been approached to stand as a “unity candidate”.

The Sunday Telegraph also focused on the actions that were expected to be taken by Jeremy Hunt. Writing in the paper, he said that the government was “changing course”.

He added:

It was a mistake to cut the tax paid by the very wealthiest, and we should have allowed the independent Office for Budget Responsibility to assess whether the figures add up.

Those two things are being put right.

We are changing course to show the markets, the people of this country and our friends and allies around the world that the British government will always properly account for every penny of tax and spending.

The Observer has that story on how Tory MPs are plotting to get rid of Truss.

Pushed on whether Labour accepts the need for spending cuts and tax increases, Labour shadow business secretary Jonathan Reynolds has said he would need to know the “scale of the damage” and cannot base his comments on speculation, but he insisted any Labour spending plans would be fully costed.

He told the BBC’s Sunday with Laura Kuenssberg programme:

I’m not even sure what this Government’s economic policy is at the moment. I don’t know which bits of the budget still apply, and I don’t know what we will hear next week.

What I would say is, any cuts the Conservative Party brings forward are entirely of its own making. Entirely because of its own incompetence.
I would just heed any Conservative MP and ask them, where do they think they are going to find cuts? I mean look at the state of the NHS, look at the state of the criminal justice system. Look at law and order in this country.

It may be a good time to read this explainer from the Observer’s Toby Helm on how Liz Truss could be forced to quit.

Under Tory party rules, a new leader cannot be challenged through official procedures for at least a year after entering office.

But there are other routes. MPs say that if at least half the parliamentary party wanted Truss gone (that is the case already) and they all write to 1922 committee chair Graham Brady to say so, he would then feel obliged to visit the PM and tell her the game was up.

If messages were also conveyed from the chief whip, Wendy Morton, and other grandees that she had lost her party in parliament, it would be difficult to fight on.

Q. Would he run again for Tory leader?

Jeremy Hunt says that having run in two leadership campaigns, and failed in both of them, “the desire to be leader has been clinically excised from me.. I want to be a good chancellor .. it’s going to be very very difficult but that is what I’m focusing on.”

[Not a ‘no’ then]

Politicians can’t control markets – and it’s dangerous when they try – but what they can do is speak with candour about the difficult decisions they are going to make, Jeremy Hunt has said.

“I want people to know we are going to make those difficult decisions in lots of areas, that are going to affect lots of walks of life in order to do everything that we can as a government to bring back that stability,” he told Laura Kuenssberg’s show on BBC 1.

Now, the proof of the pudding is in the eating. There is now two weeks in which we are going to go through a process of doing that but I think that what the country will see at the end of that process is a government that is willing to do the tough and difficult things to secure the long term prosperity that we all want for our families.

Q. How was Liz Truss when you spoke to her on the phone the other day?

Hunt says they have known each other for many years and he saw someone who was absolutely determined to do the right thing and recognises that you are not always going to be popular.

She knew that the way she had done things had not worked and she was willing to change.

Jeremy Hunt says Liz Truss has been prime minister for less than five weeks and the “central insight” that she campaigned on during her leadership campaign is that economic growth is the key thing we need.

Q. How can people trust what is being said?

He replies:

Because she has listened. She has changed. She has been willing to do that most difficult thing in politics, which is to change tack.

Q. Is it a return to austerity?

Hunt says he was in the cabinet in 2010 and he doesn’t believe there will be “anything like that”.

Laura Kuenssberg points out that there are rising interest rates now, however, and inflation.

Hunt says that if decisions are taken now then that is the best way to stop mortgage rates going up.

He says:

For those on the breadline I want them to know this is a compassionate Conservative government thinking about them at the top of our mind as we make these difficult decisions.

Q. Where are you going to cut public spending?

Hunt replies he wants to be very honest about that but it’s going to be two weeks on Monday in the House of Commons when he makes that announcement. Every department will be asked to find savings.

He is not taking anything off the table but wants to keep as many of the tax cuts that have already been announced

How confident is Hunt that markets are going to believe him and the turmoil can be calmed down on the basis of his assurances?

Hunt replied:

Well, I think for people trading in markets actions speak louder than words. The prime minister has changed her chancellor. We are going ot have a very big fiscal statement – a bit like a budget – in which we set out the tax and spending plans for several years ahead and that is going to be independently verified by the Office for Budget Responsibility.

We have been honest that it was a mistake not to do that in the mini budget before and that is now gong to be sorted out.

Andrew Griffith, the financial secretary to the Treasury, has attempted to quell the rebellious mood among fellow Tory MPs, calling on colleagues to “get behind” Truss and Hunt.

Speaking on Sky News, Griffith continued with the Truss strategy of attempting to deflect questions about the government’s so-called “mini-budget” by deflecting difficult questions towards the action taken to cap energy bills.

US presidents don’t often put the boot into UK prime ministers (though there was also Donald Trump) but Joe Biden has also been among those criticising Liz Truss this weekend.

Biden has called Truss’s abandoned UK tax cut plan a “mistake” and said he is worried that other nations’ fiscal policies may hurt the US amid “worldwide inflation”.

He said it was “predictable” that the new British prime minister was forced on Friday to walk back plans to aggressively cut taxes without identifying cost savings, after Truss’s proposal caused turmoil in global financial markets.

It marked an unusual criticism by a US president of the domestic policy decisions of one of its closest allies.

Asked if Truss should go, Robert Halfon stopped short of calling for her removal, telling Sophy Ridge after a very long pause: “Well, at this time I am not calling fo her to go.”

But he added:

I worry about further political instability, even more economic instability, but things have to improve. I think she needs to set out some of the things I have been suggesting ... If things don’t change I just think things may not be able to carry on in the way they have been.

In a piece for the Times this weekend, Halfon called on Truss to embrace the the blue-collar Conservatism that, he says, shaped the party’s success.

Remedies included reforming the £100bn-plus intervention on energy bills, he wrote, asking “Why should large companies or wealthy individuals get financial help?”

He also said that, far from scrapping affordable housing targets, the prime minister “should face down the nimbys and give financial incentives to housing associations”.

The influential Tory MP, Robert Halfon, said that the prime minister needs to hold a ‘fireside chat’ with the British people, who he said are frightened and dismayed,

Halfon, a leading voice among so-called ‘blue collar’ conservatives, said:

I worry that over the past few weeks that the government has looked like Libertarian jihadists and treated the whole country as laboratory mice to carry out ultra free market experiments

This is not where the country is. There has been one horror story after another. It’s not just about tax cuts for the rich. It’s also about about benefit cuts

Thousands of food bank volunteers will warn Liz Truss tomorrow that they are having to ration provisions, as their services have become “overstretched and exhausted” because of an influx of people needing their help.

In a sign of a continuing cost of living crisis that was building even before the economic crisis that followed the government’s mini-budget, a letter signed by more than 3,000 food bank workers will be delivered to Downing Street.

It includes a warning that those who used to donate to food banks are now seeking their help, while some services are facing “breaking point” even as they are braced for increasing demand in the coming months.

“People who were already unable to afford food are being hit the hardest by relentless rises in energy, food and travel costs,” states the letter compiled by the Trussell Trust, Feeding Britain and the Independent Food Aid Network (Ifan).

The Labour party is looking to capitalise on the government crisis with a series of new adverts as it gears up for the next general election.

The posters attack the Conservatives for damaging Britain’s standing on the world stage, hiking mortgages and crashing the economy.

Senior Conservatives have welcomed Jeremy Hunt’s arrival as chancellor, saying he had effectively “taken over” running the government from Liz Truss after he unceremoniously dumped her tax-cutting agenda on his first day in office.

One senior Conservative MP said it was a huge relief to have someone in charge at the Treasury who was able to admit to recent mistakes and had made it his mission to restore the government’s credibility with the markets. “It is just so good to have a grownup in the room, someone who commands respect and who has experience after this period of utter madness.”

A former cabinet minister added that Hunt’s media interviews on Saturday, warning that taxes would have to rise and suggesting spending would have to be reined in, meant he was effectively running the show. “Jeremy is saying: I’m in charge now, move over,” said the former minister.

Bank of England governor Andrew Bailey also appeared to be happy with the changes in Downing Street. Speaking in Washington, he said he had spoken to Hunt on Friday and had a “meeting of minds” on the issue of “fiscal sustainability”.