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Connect the World

Anti-Government Protests hit One-Month Mark with no end in Sight; UK Finance Minister Faces Parliament after Scrapping Tax Plan; Ukraine calls for Sanctions Against Iran after Drone Attacks; UK Finance Minister Speaks to Parliament after Scrapping Tax Plan; Reeves: Those who Caused Chaos can't be Called on to fix it; Hunt: Will take Decisions of "Eye-Watering" Difficulty if Needed. Aired 11a-12p ET

Aired October 17, 2022 - 11:00   ET




BECKY ANDERSON, CNN HOST: Welcome back! You are watching "Connect the World". And we begin with another deadly round of so called Kamikaze drone

strikes in Ukraine. The capital Kyiv among the targets at least four people are reported dead including a pregnant woman after a residential building

was hit.

More Russian attacks in the central and northern regions aimed to cripple the electrical grid.

People are being urged to conserve power to keep the system stable. Well, Ukrainian officials claim the Kamikaze drones are Iranian made and an aide

to President Zelenskyy is blaming Tehran for quote "The murder of Ukrainians". CNN's Fred Pleitgen got a closer look at these latest

additions to Putin's arsenal. And here is some of Fred's reporting from last week.


FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice over): Russia continues its bombardment of Ukraine's Kyiv infrastructure across

the country scenes like this one in Central Ukraine are common sight wreckages of power plants.

That tactic is familiar the weapon until recently was not. A kamikaze drone seen here after an attack on the other side of the country in Kharkiv

cheap, self-detonating and unmanned they are a new weapon and Russia's war on Ukraine.

The marking say - but this is no Russian made weapon. Its name is Shahed designed and manufactured in Iran known as loitering munitions, it could

circle a target and the lightweight airframe can travel long distances.

The U.S. government says a Russian delegation traveled to Iran in June to inspect the drones seen here and satellite imagery obtained exclusively by

CNN. In recent weeks, Russia has massively stepped up its use of the drone's evidence posted on Ukrainian social media on a near daily basis.


ANDERSON: Well, Iran denies supplying Russia with weapons to use in this war, but Ukraine is having none of it. Officials are calling for sanctions

against Tehran. The European Union Foreign Policy Chief says the EU will look for concrete evidence of Iran's involvement.

Well, despite Iran's denial, just last month, U.S. levied sanctions against several companies in Iran that it claims were involved in sending drones to

Russia. Iran has spent billions of dollars annually to develop its drone program, which is run by the country's Revolutionary Guard Corps IRGC, that

name might sound familiar.

Well, if it does, it's because it's the same military body currently engaged in a bloody crackdown of protesters. Well, today marks one month

since the start of those anti-government demonstrations ignited by the death of a 22-year-old woman in police custody. Mahsa Amini died last month

after being detained by Iran so called morality police for allegedly not wearing her hijab properly.

Well, U.S. President Joe Biden calling on Tehran to "End the violence against his own citizens for simply exercising their fundamental rights".

Mr. Biden's remarks have sparked an angry response from Iran's President.


EBRAHIM RAISI, IRANIAN PRESIDENT: It is our belief that America is behind the majority of destruction, terror riots in chaos in the region and the

world. It affirms our belief and the world's beliefs that Americans are angered and upset by every innovation, every happiness or good that happens

to Iran.


ANDERSON: Well meanwhile, Iranian official claims a deadly fire at Tehran's Evin Prison is not connected to the wave of protests sweeping the country.

The notoriously brutal facility is known for housing political prisoners, a news agency aligned with the Iranian government now says eight inmates died

and dozens of others were injured in Saturday's blaze.

Look, there's a common thread running from those drones in Ukraine through to the crackdown on protesters a lack of accountability and ownership from

the Iranian leadership. It is not listening to either the international community or more importantly, its own citizens.

Well, my next guest agrees he is U.S. President Joe Biden's Special Envoy for Iran. He tweets this "Sadly, but unsurprisingly", Iran's government

continues to fire on peace for protesters rather than listening to them.


ANDERSON: We had a valuable conversation with human rights activists on the situation in Iran and steps the U.S. can take to support its people's

fundamental rights. Well Robert Malley, joining me now, from the U.S. State Department. I know that you spoke to rights activists from Iran late last

week, what can the U.S. do to show its support for Iranian protesters at this point?

ROBERT MALLEY, U.S. SPECIAL ENVOY FOR IRAN: Well, thank you Becky. And first of all what I say is exactly echoing what you said just a minute ago,

which is that Iran's leaders should stop pointing the finger to external actors who have nothing to do with what's happening in their country, they

should listen to their people.

And as you say, they should listen to the international community and stop providing deadly drones to Russia, which is being used to kill innocent

Ukrainians. What we've done from day one from when the protest started is three things.

Number one, we've made clear that when there's - there's a struggle between peaceful protesters who are protesting for basic rights in this instance,

the right of women and girls to wear what they want the right to peacefully assemble and to speak against a government that is using brutal repression

against peaceful demonstrators.

There's no doubt on which side we're? We're on the side of those fundamental rights, and of those fundamental rights being respected. And so

you've heard the President, you for the Secretary of State. You've heard all U.S. officials, speaking to this matter, to put the spotlight on what's

happening to make sure that Iranians are being seen. Those who are protesting and those who are trying to kill them, and will continue to do

that with--

ANDERSON: I'm sorry - this isn't the time that the U.S. administration will be prepared to do business with this regime, right?

MALLEY: Let me just finish the two other points that that I want to make. So we want the Iranian people to be seen, we want the people who are

repressing them to be watched. And that's why we are imposing sanctions on them. And we continue to impose sanctions on the morality police and on

those involved in the repression.

And third, we're going to make sure that the Iranian people can be heard. And we'll try to do everything we can to make sure that they have access to

the internet at a time when their government is trying to prevent them from doing so.

ANDERSON: There are a whole bunch of threats. I want to just spend some time talking to you about. I hear what you just said and much of what we

will discuss speaks to what the U.S. administration thinks it can do next, let's talk about these drone strikes in Kyiv.

The Ukrainian say they are Iranian made, and is Iran strengthening its commitment to supply arms for Russia's assault on Ukraine to your mind?

MALLEY: So we warned about this back in July. We made clear we had information that Iran was preparing to sell drones, hundreds of drones to

Russia and to train Russian operators on how to use them.

And we're now seeing in your report you're showed on the ground as recently as this morning, the devastation that those drones are causing. So we

warned about it. The Iranians are denying it but everyone can see through those lies.

The Ukrainians first and foremost, we will do everything we can to sanction anything between Iran providing drones to Russia, any other military

assistance that Iran would be providing to Russia. And so we will - we will do what we can to stop it by sanctioning Russian, Iranian or any other

entity that's involved in the transfer of weapons.

ANDERSON: And when the Iranians say these are not our weapons, you say what?

MALLEY: We say just look at the evidence. And I think we've made it clear, we warned about in the past, I think Ukraine has shown those drones and I

think you'll see I'm confident that the European Union itself will reach the same conclusion and will sanction those drones transfers.

ANDERSON: The EU today, sanctioning 11 more individuals and four entities in connection with the recent protests, at least in Iran. The U.S. has also

issued fresh sanctions against Iran over its crackdown; loosen some restrictions on exporting tech.

You already laid out what you believe the Biden Administration can do to support these protesters. Is this regime change ultimately, that you now

believe, is warranted here and that is what these protesters are asking for?

MALLEY: So our policy is not one of regime change instigated from Washington. That's not our policy. Our policy is to defend and support the

fundamental rights of Iranian citizens just as we want to support the fundamental rights of citizens across the globe.

Form of government in Iran will be up to the Iranians to decide our position, which is very clear is we support the fundamental human rights of

ordinary Iranian women and men and that is our policy.

ANDERSON: I do want to just discuss the terrifying fire at the notorious Evin Prison over the weekend. Have you accounted for all of the Americans

being held inside that prison --?


MALLEY: So as you say, Ahmad and Siamak are the two who are in Evin Prison. It was an agonizing weekend; you could imagine for the families, they're

now accounted for. They're safe, but they need to be released immediately. They need to be able to go back to their families, and we're fighting every

day to make that happen.

ANDERSON: What are you doing to make that happen?

MALLEY: So we're engaged. First of all, we're calling on the Iranian government to do the right thing. These people are wrongfully detained, or

three of them - as well, they all three are illegally unlawfully detained, they should be released; they should be reunited with their loved ones.

We're also engaged in discussions about humanitarian arrangements to make that happen as soon as possible. And we won't rest until that's done.

ANDERSON: Talks to revive the nuclear deal have been on life support the U.S. Foreign Policy Chief today saying doesn't expect any movement anytime

soon. The U.S., it seems now waiting until after the November midterms, correct me if I'm wrong there. But anyway, at this point, can you see

yourself re engaging with a government negotiating with a regime that murders its own people?

MALLEY: So I make three points. First, the eyes of the world right now are where they should be, which is on what's happening in Iran. And that's

simply the reality as a result of Iranian government's actions, its violent repression of protesters.

Second, President Biden made it clear from the first day he came into office that one of his priorities was to prevent Iran from acquiring a

nuclear weapon. And he believes and we continue to believe that diplomacy is the best way to achieve that goal.

But thirdly, the reason the talks are at a standstill in an impasse and why they're not so far moving at all and why they're not the focus is because

Iran has taken a position in those talks for the past two months, we're just simply inconsistent with a return to the deal. They're making demands

that have nothing to do with the JCPOA. And as long as that's the case, the talks will be stalled.

ANDERSON: That isn't answering the question, how could a U.S. government justify negotiating with a regime that murders its own people? |You are

talking about the stalling of those talks for another reason? So can you just address that concern that people have?

MALLEY: As I said, right now, there's no - it's not even on the agenda. It's on the focus, because there's no movement. We do believe that we need

to stop this regime from acquiring a nuclear weapon.

Diplomacy as a way to do that, we will see whether this is a government that is interested in reaching that deal. But at this point, the focus is

on what's happening in Iran because the talks are stalled. So it's an academic question.

ANDERSON: Well, Malley thank you for joining us.

MALLEY: Thank you.

ANDERSON: Later on "Connect the World" we'll speak to exiled Iranian Actress who was speaking out in favor of the protesters. Golshifteh

Farahani says this is not only about Iran this is about the world that interview is coming up later this hour.

Well, an income tax cut a two year energy price cap and dividend reforms all of those or at least parts of them have gone. Investors across the

world and watching the UK after the British Prime Minister's controversial mini-budget was torn to pieces. Liz Truss' new Finance Minister says he is

scrapping the government's tax plan.

Jeremy Hunt is set to speak any moment in the House of Commons this latest U-turn intended to calm what were jittery financial markets and that

certainly has happened. Hunt says stability is the UK's top priority.

I want to bring in CNN's Bianca Nobilo live from London. And as you and I speak we're still listening to questions being taken by the Leader of the

House because Prime Minister Liz Truss is absent today.

We will be hearing from the Finance Minister laying out further detail on his plan. But ultimately, this is Liz Truss the Prime Minister's plan being

torn up at this point, isn't it? And it does beg the question how terrible is her position?

BIANCA NOBILO, CNN CORRESPONDENT: And that's what we're hearing inside the House of Commons chamber right now Becky. In fact, Hilary Benn, who's a

senior Labor Party MP, somebody who can be impassioned but is definitely not known for being inflammatory just said it's clear the Prime Minister is

no longer in charge.

We've had a member of the Prime Minister's own party, a senior MP say that Jeremy Hunt, the Chancellor is now the de facto Prime Minister. So

everything here even the optics adding up to undermine the Prime Minister and paint the picture of someone in post but not in power.

Even the fact that she isn't standing in her position behind the dispatch box there, she's absent when she should be present. The fact that she

probably won't be on the benches behind the chancellor, which is often where we see the Prime Minister supporting a new economic policy


I think it's unlikely that she'll be there when Jeremy Hunt speaks based on what we're seeing. And all of this it paints a picture of a Prime Minister

receding into the background while Jeremy Hunt has addressed the nation today on television this morning steadied the economic ship a little bit

and he'll be addressing the House of Commons in a matter of minutes.


NOBILO: It really should be the prime minister that's that visible and taking that leadership role.

ANDERSON: But it isn't. OK, well, we're going to stick with this, keep an eye on it. For our viewers, we are going to take a short break before we

hear from Jeremy Hunt more as well on Russia's punishing strikes on Ukraine when we return. We'll have a live report from Kyiv on the round, the deadly

round so called Kamikaze drone strikes. And we will also talk to an advisor to Ukraine's defense minister, stay with us.


ANDERSON: Well, back to our top story there. Today a deadly new barrage of Russian drone attacks in Ukraine. Now the Interior Ministry says that

Russia tried to outdo last Monday's attacks but failed. Ukraine claims it shot down 36 of the 42 attack drones launched today.

Most of them are targeting Kyiv still at least four people were killed when a so called Kamikaze drone hit a residential building there. CNN's Chief

International Correspondent Clarissa Ward joins us now live from Kyiv. And you are in or certainly have been in downtown Kyiv today. Just what did you


CLARISSA WARD, CNN CHIEF INTERNATIONAL CORRESPONDENT: Well, Becky, it was a pretty harrowing scene down near the railway station right in the center of

town. The apparent target appeared to be a sort of power plant in the area. But the actual place that was hit was a residential building and there were

at least four people killed.

We saw the body of one older woman, reportedly also a young couple were killed the wife was six months pregnant. We spoke to the Mayor of Kyiv at

the site Vitali Klitschko. And he said it's obvious that the Russians are focusing on Kyiv that they are focusing on civilian targets and civilian

infrastructure and that they're designed to - people are frighten or disturb people.

He says that it's actually having the reverse effect that it's making people angry that it's making people hardened in their resolve to win this

war outright. But no matter what, Becky it is clear that people in Kyiv after several months of relative calm here are now paying a very bitter

price in this sort of new grim chapter of the war that began in earnest last week with that barrage of missiles that slammed in to Kyiv of last

Monday and which continue today with these kamikaze drone attacks. As you said you've seen the social media video police forces desperately trying to

shoot them out of the sky.


WARD: But they are difficult to detect. And that is why you are seeing this full throated appeal from Ukraine's leaders for the international community

to provide better, more sophisticated and more widespread air defense systems in this country to avert the kind of horror that we saw earlier

today, Becky.

ANDERSON: And we're just about to interview the adviser to the defense minister. So we will pursue that line of a line of question. Before I let

you go some months of relative calm in Kyiv. As you rightly pointed out, now, very much punctured by what seems like a new strategy in this war.

But if it's emboldened in Ukrainians, and listen them, some of that is going to be propaganda, right, but some of it is going to be for real. Is

it a Russian strategy that is likely to backfire at this point?

WARD: Well, that's definitely the gamble. And first of all, I just want to be clear about something, the goal or the target of these attacks, both

last Monday, and today's appears to be this sort of energy plant and critical civilian infrastructure in the center of town.

From what we've been able to see, we can't ascertain that there's actually been any meaningful or impactful structural damage to that plant its other

buildings in the vicinity that have been hardest hit and ordinary civilians who have borne the brunt. So this is not really an effective strategy on a

number of levels for the Russians. And I can certainly tell you that having conversations with Ukrainians over the past week or so, I really feel there

is a hardening of resolve. And there is a determination to win this war.

Nobody here at this stage is talking about the possibility of making concessions or potentially dividing up areas or having UN-backed referenda,

as Elon Musk potentially suggested. Ukrainians now believe that they can win this that they can do it, and they are determined to do so. Becky.

ANDERSON: Clarissa Ward is in Kyiv in Ukraine, Clarissa, thank you. Well, let's talk about these latest developments with an advisor to Ukraine's

defense minister, Yuriy Sak joining us live from Kyiv as well tonight. So can you give us a better idea of how the so-called Kamikaze drones work,

where you understand that they are being fired from and why they are so terrifying?

YURIY SAK, ADVISOR TO UKRAINE'S DEFENSE MINISTER: Hello, Becky, and thank you for having me. Now, these drones are dangerous because they fly on low

altitude, and they fly at pretty slow speed. So on the one hand; it's easy to detect them. But on the other hand, it means that they are undetectable

for the certain types of air defense systems, which means that they present a threat to the cities, which we have seen today.

Today, as you've said in your previous report, you know, this strike at Kyiv was deadly, you know, block of the partners was destroyed, in addition

to other, you know, five out of 30 drones, just so that you understand.

So 30 drones in total that fired at Kyiv, five of them actually reached that target, one of them hit a block of residential apartments, killing at

least four people, among them a young couple, and a lady in that couple who was pregnant with a six, six month, six month pregnancy. So this terror

continues, and these drones present, of course a threat to our cities.

ANDERSON: And where are they being fired from?

SAK: The ones that hit Kyiv today and the ones that were flying at Kyiv today, according to our Air Force Command, they were fired from the south

of Ukraine. So we don't know the exact location but presumably the temporarily occupied parts of Kherson region or Crimea.

ANDERSON: The Iranians say they're not theirs to which you say what?

SAK: To this we say don't listen to Iranians, don't listen to Russians don't listen to terrorist states. You know, one terrorist state is

providing another terrorist state with drones. And now we understand that Iran, Iran is planning to provide Russia also with ballistic missiles and

cruise missiles. So don't listen to them.

It is obvious you know we are shooting down these drones on a daily basis. Now today we have strapped down about 30. So we have been able to look

inside these drones and we are confident and we have objective evidence that these are Iranian drones which are re-branded for Russia.

But it's you know Iran has sent to Russia already hundreds of drones and apparently according to our Defense Intelligence is planning to send more

than 2000 more.


SAK: So this is a huge number. And what I would like to say is that, you know, these drones bind you, of course, Iran has not produced these drones,

they were not meant for Ukraine. According to the logic, these drones were meant for Israel, you know, and Iran is just essentially using Ukraine now

as a testing ground for these drones.

And once they are tested in Ukraine and perfected the next target, most likely, and this is what Iran has been saying for a long time will be

Israel. So from this perspective, for us, it is very unusual to see that while the whole free world is supporting Ukraine.

Israel has taken a very difficult to understand neutral stance, and Israel understands that they Israel does have anti-drone systems. Israel has been

working on these air defense systems for a long time. So we encourage Israel to provide Ukraine with these systems, and they can be tested here

and you know, this way Israel will help Ukraine protect ourselves as well as help itself protect itself in the future.

ANDERSON: You are calling on Israel for that sort of military hardware? Have you got what you need, given that the NATO members met last week? The

enormous amount of conversation went on with regard defense capability for Ukraine. Is it sufficient at this point? What is on offer?

SAK: Well, the latest Ramstein was almost 100 percent, you know, dedicated to because it took place after the missile strikes at Kyiv on October 10

and 11. So the latest Ramstein as well as NATO meeting they were all aimed at providing Ukraine with these air defense systems.

But look, these are dangerous drones like today; police in Kyiv was trying to shoot them down with ordinary rifles and guns. These drones require

those jamming and electronic warfare systems which are efficient at dealing exactly with these drones. So countries like Israel have this technology

should hurry up and provide it to Ukraine, that's our opinion.

ANDERSON: And Yuriy Sak, it's good to have you on sir. Thank you very much indeed for your perspective. And for more on Russia's war in Ukraine, use

the website scroll down to find live updates on the war and why Ukraine's foreign ministry is calling for sanctions against Iran.

You'll also find more on those Kamikaze drones which are the latest threat to Ukraine, all of that at One month in counting protests

sweeping Iran show no signs of slowing down, we'll speak to an Iranian actress in exile about why she thinks this time it is different.



ANDERSON: Right, we are keeping an eye on what is going on at the House of Commons in London in Britain; we are awaiting a speech from the finance

minister, the Chancellor of the Exchequer as he is known there. Of course, sir, the Prime Minister Liz Truss, sacking her former finance minister just

last week.

And Jeremy Hunt is assuming that position many people calling him the CEO in the UK now and Liz Truss, the Prime Minister, just a Chairman, as it

were after he has reversed much of what she and her former finance minister had implemented as part of the UK's growth strategy going forward.

So we are - this is the Speaker of the House and we are awaiting the Chancellor of the Exchequer just as soon as he gets to his feet, we will

get you that speech. Right, well, Iran's president is accusing the U.S. of fermenting the recent wave of protests after a show of support for the

protesters from President Biden.

Anti-government demonstrations, so show no sign of slowing a month after the death of a young woman in police custody. That's despite a brutal

crackdown by Iranian authorities. Meanwhile, we are learning more about a fire at Iran's notorious Evin Prison.

Iranian state media report, eight prisoners died and dozens of others were injured in Saturday's Blaze. Well, my next guest is filled with admiration

for the protesters in Iran. Saudi Iranian actress Golshifteh Farahani is a huge star and has been using her wide following 14 million on Instagram

alone to raise awareness of what is happening right now in her homeland.

She writes today, and I quote, "This is not only about Iran, this is about the world not only the women of the world, but humanity in the world. This

is a worldly revolution for humanity". And she joins us now live from Cape Town in South Africa.

And before I go to you let me just get this statement from the Chancellor of the Exchequer and we will come to you for this discussion. Let's listen

into Jeremy Hunt.

JEREMY HUNT, BRITISH CHANCELLOR OF THE EXCHENQUER: --economic stability. Behind the decisions we take and the issues on which we vote, our jobs

families depend on mortgages that have to be paid savings for pensioners, and businesses investing for the future. We are a country that funds our

promises and pays our debts.

And when that is questioned, as it has been, this government will take the difficult decisions necessary to ensure there is trust and confidence in

our national finances. That means decisions of eye-watering difficulty. But I give the house and the public this assurance, every single one of those


Whether reductions in spending or increases in tax will be shaped through core compassionate conservative values that will prioritize the needs of

the most vulnerable. That is why I pay tribute to my predecessors for the energy price guarantee for the furlough scheme, and indeed for earlier

decisions to protect the NHS budget in a period when other budgets were being cut.

But Mr. Speaker, I want to be completely frank about the scale of the economic challenge we face. We have had short term difficulties. We have

had short term difficulties caused by the lack of an OPR forecast alongside the mini budget, but there are also inflationary and interest pressures

around the world.

Russia's unforgivable invasion of Ukraine has caused energy and food prices to spike. We cannot control what is happening in the rest of the world. But

when the interest of economic stability means the government needs to change course, we will do so. And that is what I've come to the house to

announce today.

In my first few days in the job, I've held extensive discussions with the Prime Minister, Cabinet colleagues, the Governor of the Bank of England,

the OPR, the Head of the Debt Management Office, Treasury officials and many others. The conclusion I've drawn from those conversations is that we

need to do more, more quickly. To give certainty to the markets about our fiscal plans and show through action and not just words that the United

Kingdom can and always will pay our way in the world.


HUNT: We've therefore decided to make further changes to the mini budget immediately, rather than waiting until the medium term fiscal plan in two

weeks' time in order to reduce unhelpful speculation about those plans.

Mr. Speaker, I'm very grateful for your agreement on the need to give the markets and early brief summary this morning but I welcome the opportunity

to give this house detail of those decisions now. We've decided on the following changes to support confidence and stability.

Firstly, the Prime Minister and I agreed yesterday to reverse almost all the tax measures announced in the growth plan three weeks ago that have not

been legislated for in Parliament. So we will continue with the abolition of the health and social care levy changes to stamp duty, the increase in

the annual investment allowance to million pounds and the wider reforms to investment taxes.

But we will no longer be preceding with the cuts to dividend tax rates, saving around a billion pounds a year. The reversal of the off payroll

working reforms introduced in 2017 and 2021, saving around 2 billion pounds a year.

The new VAT free shopping scheme for non UK visitors saving a further 2 billion pounds a year or the freeze on alcohol duty rates saving around 600

million pounds a year. I will provide further details on how those rates will be upgraded.

UNIDENTIFIED MALE: Just let us swap this telephone that just switched off, so OK, sorry chumps to carry on --.

HUNT: I will prefer to provide further details on how alcohol duty rates will be upgraded shortly. Second, the government is currently committed to

cutting the basic rate of income tax to 19 percent in April of 2023. It is a deeply held conservative value; a value that I share that people should

keep more of the money they earn, which is why we have continued with the abolition of the health and social care level.

But at a time when mass markets are asking serious questions about our commitment to sound public finances, we cannot afford a permanent

discretionary increase in borrowing worth 6 billion pounds a year. So I've decided that the basic rate of income tax will remain 20 percent.

And it will do so indefinitely until economic circumstances allow for it to be cut. Taken together with the decision not to cut corporation tax and

restoring the top rate of income tax, the measures I've announced today will raise around 32 billion pounds every year. The third step I'm taking

today, Mr. Speaker is to review the energy price guarantee.

That was the biggest single expense in the growth plan and one of the most generous schemes in the world. It's a landmark policy, for which I pay

tribute to my predecessor, my right honorable friend from --.

And will support millions of people through a difficult winter, reducing inflation by up to 5 percent. So I confirm today that the support we are

providing between now and April next year will not change. But beyond next April, the prime minister and I have reluctantly agreed it would not be

responsible to continue exposing the public finances to unlimited volatility in international gas prices.

So I'm announcing today a treasury led review into how we support energy bills beyond April next year. The reviews objective is to design a new

approach that will cost the taxpayer significantly less than planned, whilst ensuring enough support for those in need.

Any support for businesses will be targeted to those most affected and a new approach will better incentivize energy efficiency. There remain I'm

afraid many difficult decisions to be announced in the medium term fiscal plan on October the 31st.

When I confirm that we will publish a credible, transparent fully coasted plan to get debt falling as a share of the economy over the medium term

based on the judgment and economic forecasts of the independent office for Budget Responsibility.

I'd like to thank the OBR whose Director Richard Hughes I met this morning, and the Bank of England whose Governor Andrew Bailey I've now met twice. I

fully support the vital independent roles both institutions play, which give markets the public and the world confidence that our economic plans

are credible and rightly hold us to account for delivering them.

But I also want more independent expert advice as I start my journey as Chancellor. So I'm announcing today the formation of a new economic

advisory council to do just that.


HUNT: This council will advise the government on economic policy with four names announced today, Rupert Harrison, former Chief of staff to the

Chancellor of the Exchequer, Gertjan Vlieghe from Element Capital, Sushil Wadhwani of Wadhwani Asset Management and Karen Ward of JP Morgan.

Mr. Speaker, Mr. Speaker, we remain completely committed to our mission to go for growth, but growth requires confidence and stability, which is why

we are taking many difficult decisions starting today. But whilst we do need realism about the challenges ahead, we must never fall into the trap

of pessimism.

Despite all the adversity and challenge we face, there is enormous potential in this country with some of the most talented people, three of

the world's top 10 universities, the most tech unicorns in Europe, one of the world's great financial centers, incredible strengths in the creative

industries in science, research, engineering, manufacturing, and innovation and all that gives me genuine optimism about our long term prospects for


But to achieve that, it is vital we act now to create a stability on which future generations can build. The reason the United Kingdom has always

succeeded is because of big and difficult moments.

We have taken tough decisions in the long term interests of the country, and in a way that is consistent with compassionate conservative values.

That is what we will do now and I commend this statement to the house.

UNIDENTIFIED MALE: I now call the Shadow Chancellor, Rachel Reeves.

RACHEL REEVES, BRITISH SHADOW CHANCELLOR OF THE EXCHENQUER: Thank you, Mr. Speaker. As I regularly say now, I welcome the new chancellor to his place.

The fourth in four months of chaos and fiasco as this conservative government spirals down the political plug hole, but the damage has been

done. This is a Tory crisis made in Downing Street.

But ordinary working people are paying the price all that is left after these humiliating U-turns, higher mortgages for working people and higher

bonuses for bankers. And they're climbed down on Energy Support begs the question yet again, why won't they extend the windfall tax on energy

producers to help put the bill? Now, it is good to finally see the prime minister in her place and not as the leader of the House had to assure us

earlier under a desk. But Mr. Speaker, what is she left with? No authority, no credibility, no plan for growth. And it is clear to see that people who

caused the chaos cannot be the people to fix the chaos.

They are out of ideas out of touch and out of time. Now, the prime minister should have spoken to the house today. But we know that she could not do

that with a shred of credibility, given that the survival of this government now depends on smashing to smithereens, everything that she

stands for.

And now she is attempting to reverse everything that she campaigned on. It is not just impossible. It is absurd. The prime minister is barely in

office, and she has certainly not in power. Only five days ago, the prime minister said a prime minister's questions that there would be and I quote,

"absolutely no public spending reductions".

But after what we have heard from the chancellor today, every single public service is again at risk from the conservatives, from our NHS nurses to our

schools to our servicemen and women with the country paying the price for their incompetence.

The prime minister said that she had an energy package for two years. Now that's been withdrawn on the very day it is supposed to be legislated for.

The prime minister insisted that her conservative mini budget would lead the country to the Promised Land.

Instead, it has led to the highest mortgages in 15 years and emergency interventions by the Bank of England to protect pensions. And then on

Friday, the unedifying spectacle of the Chancellor is being dragged back from the IMF before he could do any more damage to our economy.

So she has turned to a new chancellor, who finished eight out of eight in the Tory leadership contest winning just 18 votes from MPs. The Tories have

run out of credibility and now they are running out of Chancellors. The latest officeholder has been in the cabinet for nine of the last 12 years

at the center of a government responsible for low growth and weakened public services and him responsible for helping run the NHS into the

ground. He was a big part of austerity season one and now he says the cure is austerity season two.


REEVES: And what Mr. Speaker was the Chancellor's flagship policy in his own short lived leadership contest to reduce corporation tax in a totally

unfunded manner, not from 25 percent to 19. The right honorable gentleman called for it to be lowered to 15 percent with not a single explanation of

how it was to be paid for.

The truth is had he won the contest and implemented these policies, we would be in an even worse place than we are now, there is no mandate, there

is no authority for any of this.

The conservatives have put a lasting premium on people's mortgages. Un- posted borrowing has sent interest rates spiraling. Millions of people's mortgage deals were coming to an end in the next few months, leaving many

families forking out 500 pounds or more a month.

People will be paying a Tory mortgage premium for years to come. So how does the chancellor think ordinary people can possibly afford any more of

this conservative government? We've heard no answers today.

Now the chancellor has said that growth requires confidence and stability. I agree. But where does he think the lack of confidence and their lack of

stability has come from? It didn't come from the sky, Mr. Speaker; it came from the mini budget three weeks ago.

And what does it say about our country that we are watching borrowing costs hour by hour. That's not the sign of a strong g7 economy. It is the exact

opposite. Businesses are now saying that things are so unstable that they are pausing investment here in Britain.

The former Deputy Governor of the Bank of England, Charles Bean, has outlined the extraordinary damage that the conservatives have done to our

standing. In his words, we've moved from looking not too dissimilar from the U.S. or Germany to looking more like Italy and Greece.

What a mess. And where is the Office of Budget Responsibility forecast? Has this government learned nothing? Does the chancellor really expect the

country to take everything from him at face value? Last week, the business secretary was busy undermining the office for Budget Responsibility.

Today we have received another massive fiscal statement with no forecast. What has this government's got to hide? They should publish the numbers so

that we know the true state of the public finances after 40 days of this prime minister and after 12 years of Conservative government.

Now today, the chancellor has scaled back help with energy bills for families and pensioners. It begs the question yet again, why won't they

bring in a proper windfall tax on energy, which is just a help for the built for consumers?

And when will the current chancellor publish in full the government's estimates of windfall profits of the energy giants over the next two years?

Now, no one was talking about spending cuts until the Tories crushed the economy within many budgets.

So I asked the chancellor, why should the British people pay the economic price for the tourism mistakes? And what spending cuts does the government

plan to make? We believe that the government must honor its commitments to up rate benefits and pensions in line with inflation.

Will the chancellor make it clear today that that is what he intends to do? And what a contrast that cuts the benefits are still on the table. But the

one thing that Chancellor couldn't bring himself to reverse today was lifting the cap on banker's bonuses.

Why is this last policy standing in these disastrous many budgets? And let me come to credibility. Does the chancellor accept that once credibility

and trust have been destroyed, it cannot be simply regained by a series of zigzagging chaotic U-turns.

Will he and the Prime Minister apologize for the costs and anxieties laid on families? Can he admit once and for all that the market turmoil we are

in was directly caused by the disastrous decisions of his predecessor and of the prime minister?

Can he guarantee that the Bank of England won't have to intervene again to save the government? And what guarantee can he give to people about their

pensions about their mortgages and their household bills? The chancellor said today that everything is now on the table. But is that really the


We know that abolishing the non-DOM tax status will raise 3 billion pounds a year. There was no mention of that today. How can it be right that some

of the richest individuals in society allowed buying their way out of paying tax that should be paid here in Britain?

This would not be an eye wateringly difficult decision, Mr. Speaker. So why doesn't the government just do it? That is lasting damage, which these

policy U-turns won't change. They've set fire to everything. Now they insist it is all fine. The truth is Mr. Speaker an arsonist is still an

arsonist even if he runs back into a burning building with a bucket of water.


REEVES: Because they can't be trusted, the Tories are clinging on for themselves regardless of the cost to the country, trickle-down economics

will always fail. What drives forward our economy are the talents and efforts of millions of working people and thousands of ordinary businesses.

The government's economic credibility has been destroyed, they have harmed our economic institutions, people are paying higher mortgages, the same set

of people doing U-turns isn't going to fix it the only way to change this as a real change in government.

HUNT: I thank the honorable Lady for her questions. And I'm sorry that given the speed at which things moved at the weekend, I haven't had time to

sit down with her one to one as would normally be the practice before parliamentary exchanges. Now I understand the role opposition party's play.

I've stood at that dispatch box myself, but behind, behind, behind the rhetoric and I was listening very carefully. I don't think she disagreed

with a single one of the decisions that I announced to Parliament.

And that is important for the country and markets to know. And I think there is also agreement on the process of policymaking. I support the

independence of the Bank of England introduced by Gordon Brown, and I know she supports the independence of the OBR set up by George Osborne.

The government, the whole government supports the independence of those two important institutions. Now I fully accept. And I don't think I could have

been more clear that we have had to change some decisions made in the last few weeks. But what I reject, what I reject wholeheartedly is her broader

narrative about conservative economic management. Let me remind her, let me remind her that the UK's unemployment rate is the lowest since 1974, that's

below France, Italy, Canada, Belgium, Sweden, Spain and the Netherlands and massively lower than 2010.

Let me remind her that since 2010, our growth rate has been the third highest in the g7. She may not want to hear this, but these are the

economic facts. Our growth rate since this party came into power has been higher than Germany, France, Italy, and Japan and faster than any g7

country this year.

Looking to the future, we have the largest technology sector in Europe, more foreign direct investments than anywhere in Europe - one country that

is a legacy to be proud of. Now, I was listening carefully for some questions about the measures that I announced.

But she didn't ask any and I think she agreed with him. But I will pick her up on --. She talked about the NHS. Let me tell her, maybe they don't want

to listen about the NHS. She talked about the NHS, because of the global financial crisis, which happened on her party's watch.

The NHS went through one of its most difficult periods ever, and this party protected the NHS budget. Then in 2017, we were able to give it his biggest

single increase in funding because of the difficult decisions that we took and that party opposed. So Mr. Speaker, in conclusion, we inherited the

financial crisis. We dealt with a global --.

ANDERSON: You've been listening to the Chancellor of the Exchequer as he is known, the Finance Minister, the British Finance Minister, Jeremy Hunt,

this is a government committed to growth. But he said we found our promises and pay our debts in what was an opening statement to the house.

As he explained that he didn't get the UK's debt falling as a percentage of GDP by the EU terms that this government has now performed. Let's bring in

Bianca Nobilo, who has been listening into the exchanges between Jeremy Hunt, Bianca and the opposition Chancellor, who was certainly

electioneering as she spoke there earlier on today.

I mean, you would expect to hear most of what you heard from the opposition. But what more did we get of substance from the new finance


NOBILO: We had a bit of fleshing out. He underscored what the overarching principles and priorities are for the government, which you just outlined.

And he said that the first three steps that he was going to take would be first of all to reverse almost all of the tax related policies announced in

the mini budget other than the ones that have already been approved by parliament. Not to reduce the basic rate of income tax from 20 to 19

percent, it will stay at 20.


NOBILO: And then this revision or review of the energy bill support in April next year instead of in two years' time. So we knew that from this

morning, he went into a little bit more detail. But by and large, what the questions are going to be about now and going forward is how they will pay

for some of these measures.

And we got an indication of that this morning when Jeremy Hunt said that he's going to be asking departments to be looking at where they can cut and

he wants them to be making savings. Now he's done he just got into this job.

So what will now happen is when he meets with the cabinet when he meets with individual secretaries of state of all the different departments, the

pressure will be on for them to produce areas where they can save money and that will be one of his priorities going forward.

But a bruising day for a prime minister who's had other members of her cabinet perform in a very strong way and she's just been now she's now

she's finally appeared but has been basically in hiding before then, Becky.

ANDERSON: Well, she Liz Truss, the new Prime Minister in the job walk for 40 days is in the House of Commons now in the chamber as Jeremy Hunt

continues to speak. You're watching "Connect the World", I'm Becky Anderson. That's it from us.