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LONDON. – Kwasi Kwarteng has been sacked as British chancellor amid intense speculation Prime Minister Liz Truss is about to junk key parts of their economic plan.

Kwarteng met Truss for crunch talks in Downing Street after cutting short a US trip.

In a letter to the PM, Mr Kwarteng said Truss’s vision for economic growth was “right” and he still supported it.

Truss was expected to announce a U-turn on business tax cuts at a news conference in Downing Street.

The prime minister has appointed former Health Secretary Jeremy Hunt – who backed Rishi Sunak in the Tory leadership contest – as the new chancellor.

Truss’s pledge to cut taxes was at the heart of the economic agenda that won her the Tory leadership at the start of September.

“As I said many times in the past weeks, following the status quo was simply not an option,” Kwarteng wrote in his letter.

“For too long this country has been dogged by low growth rates and high taxation – that must change if this country is to succeed.”

Responding to Kwarteng in her own letter, Truss said she was “deeply sorry” to lose him and thanked him for putting “the national interest first” by standing down. “We share the same vision for our country and the same firm conviction to go for growth,” Truss wrote.

The dramatic dismissal of Kwarteng makes him the second shortest-serving chancellor after just 38 days in the job.

A long-time ally of Truss, Kwarteng shared her tax-cutting economic ideology and was seen as her political soulmate when he was appointed to the role on 6 September.

For days, Truss has faced calls to drop parts or all of her economic plan to calm market turbulence and reassure her party, which has slumped in the polls.

Some Tory MPs have discussed options to remove Ms Truss as prime minister, laying bare divisions within the party, which has been in power for 12 years.

Truss has already U-turned on her plan to scrap the top rate of income tax and some Tory MPs believe another change of course is inevitable.

A further U-turn is likely to seen as a blow to Truss’s political authority only 39 days after she became prime minister.

Labour’s shadow chancellor Rachel Reeves said a “humiliating U-turn is necessary” after the government “plunged our economy into chaos and crisis with Truss’ discredited trickle down approach”.

“Changing the Chancellor doesn’t undo the damage that’s already been done,” she said.

Liberal Democrat leader Sir Ed Davey urged the prime minister to call a general election, accusing the Conservatives of mismanaging the economy.

“It started with Boris Johnson failing our country, and now Liz Truss has broken our economy, it is time for the people to have their say in a general election,” he said. – BBC.com