GDP stats — G20 preview — Kwasi twists the knife

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By ELENI COUREA

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Good Friday morning. This is Eleni Courea. Esther Webber will be here to start next week.

DRIVING THE DAY

FINANCIAL CRUNCH: Jeremy Hunt is speaking to broadcasters imminently to respond to GDP figures published moments ago suggesting that the U.K. economy has begun sliding into recession.

Where we are this morning: U.K. GDP fell by 0.2 percent during the third quarter of this year, according to ONS estimate stats published at 7 a.m. If the economy contracts again over the last three months of this year — i.e. for a second successive quarter — we will have entered a recession.

Reminder: Last week the Bank of England warned the U.K. was heading for the longest recession in a century, lasting until the middle of 2024.

Labour response: Rachel Reeves, the shadow chancellor, said this morning’s numbers were “another page of failure in the Tories’ record on growth. And the reality of this failure is family finances crunched, British businesses left behind and more anxiety for the future.”

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Concentrating minds: The stats pile pressure on ministers locked in talks over the Autumn Statement in six days’ time, with Rishi Sunak spending much of the day holding internal meetings in Downing Street. Today the Times, the Mail and ITV report that Hunt will cut the planned growth in day-to-day public spending after 2025 from 3.7 percent to 1 percent (the FT says it will be 2 percent or lower) — meaning a return to austerity with painful cuts on public services including schools, policing, transport and councils.

Fantasy cuts: The fact these cuts are scheduled for after the next election makes them what Robert Peston calls “semi fiction” — a device to reassure investors by cutting the deficit, even though by the time they are due to be implemented there will be a new government and new economic conditions. The danger, the Resolution Foundation’s Krishan Shah tells the Times, is that “markets may see through this.”

Indeed: It’s difficult to see how ministers can convince anyone that swingeing cuts to public services would be politically tenable in the near future, when they are already braced for a 1970s-style “winter of discontent” with looming strikes by civil servants as well as nurses, rail and postal workers, teachers and university staff.

Speaking of strikes: The Guardian’s Rajeev Syal and Dan Sabbah report that military personnel could be given a few days’ training and brought in to cover for striking Border Force officials. And the i’s Arj Singh has been leaked a letter to Home Office staff saying the department would redeploy “non-critical” workers to protect work to support “economic activity, public safety and the security of our nation” if the walkouts go ahead.

No free lunch: The Sun’s Jack Elsom hears that calls to expand free school meals eligibility, including from former 1D star Zayn Malik, will go unanswered next Thursday.

LET’S REWIND BY A FEW WEEKS … and recall that if the cards had been dealt differently, it would have been doughty Downing Street duo Liz Truss and Kwasi Kwarteng now steering the government’s response to the downturn. Last night, in his first broadcast interview since he was sacked by Truss as chancellor, Kwarteng heaped the blame on her and told TalkTV’s Tom Newton-Dunn that she ignored his warnings to exercise more caution after the budget.

Kwassandra: Kwarteng said he told Truss she had to slow down and take a “methodical and strategic approach.” (No mention here of the fact he told Laura K two days after the tax-slashing mini-budget that there was “more to come.”) When Truss rebuffed him by saying she only had two years in power, Kwarteng said he warned prophetically that “you will have two months if you carry on like this.” She ended up lasting 44 days.

Blame game: Kwarteng warned Sunak and co. not to pin the state of the economy on him and Truss. “The only thing that they could possibly blame us for is the interest rates, and interest rates have come down and the gilt rates have come down.” (No thanks to them, it must be said.) “I mean, it wasn’t that the national debt was created by Liz Truss’ 44 days in government.” Read more in TND and Oli Wright’s write-up, which splashes the Times.

What Playbook wants to see … is how Truss responds.

COMEBACK KIDS: POLITICO’s U.K. Editor Jack Blanchard returns to the Westminster Insider podcast this week for an episode on great political comebacks, following Sunak’s extraordinary 50-day turnaround from defeated leadership candidate to U.K. prime minister.

Listen in: Jack’s guests include Labour grandee Peter Mandelson, who shocked Westminster — and himself — with a sensational return to Gordon Brown’s Cabinet in 2008 after four years abroad as a European commissioner; and U.S. historian John A. Farrell, who recalls Richard Nixon’s extraordinary rise to the American presidency in 1968, eight years after his crushing defeat to John F. Kennedy. Professor Edith Hall tells the story of the great Roman leader Cincinnatus and his return to power from his humble plow — famously name-checked by Boris Johnson in his farewell speech as PM. Professor Nicholas Allen recalls other great British political comebacks of the 20th century; while POLITICO’s Trump-world reporter Meredith McGraw assesses former U.S. President Donald Trump’s prospects of a return to the White House in 2024.

MEANWHILE, IN THE US: Inflation fell in October to its lowest level since the start of the year, easing pressure on the Fed to raise interest rates. The story splashes the FT.

ON THE WORLD STAGE

BREAKING BREAD IN BALI: In between the GDP stats today and the Autumn Statement next Thursday, Rishi Sunak will hit pause on the domestic agenda for 48 hours to attend his first G20 summit. The PM is jetting off for a whirlwind trip to Bali, Indonesia on Sunday, and Playbook will be taking you along for the ride.

Wanted — a foreign policy: During his speedy rise to power through several domestic briefs, including a two-year stint as chancellor, Sunak said little about how he sees the U.K.’s role in the world — but Playbook is told that is about to change. As he lands in Indonesia, the PM is expected to lay down the first markers of his foreign policy (though you’d expect parts to be trailed in the Sunday papers ahead of his arrival). Your Playbook author has a piece out today previewing the trip, with help from Esther Webber and Cristina Gallardo.

Playing to his strengths: The Group of 20 was founded in response to several economic crises, as government strategists point out, and as Sunak prepares for his first G20 summit, the world is again in a state of financial upheaval.

The first task … is to restore the U.K.’s reputation for economic stability after Truss’ crash-and-burn premiership. “He comes to the G20 from a rather weak position,” former top diplomat Peter Ricketts said. “Everybody will be conscious that he’s facing massive domestic economic issues at home, which don’t put him in a great position to offer leadership, frankly, in that area.” A No. 10 official said: “The only good foreign policy that is made is off the back of a strong economic footing.”

Worth remembering: For the rest of the world, Sunak’s presence will be a sideshow, barely registering during an event of potentially huge geopolitical importance. The summit will be dominated by a highly anticipated meeting between U.S. President Joe Biden and his Chinese counterpart Xi Jinping on Monday as well as talks on Ukraine, with Volodymyr Zelenskyy invited to attend as a guest (while Vladimir Putin sends Foreign Minister Sergey Lavrov on his behalf).

Twin challenges: Team Sunak will need to think about playing to a domestic audience, with the approach to both China and Russia presenting problems. Tory China hawks — who were frighteningly effective at forcing Boris Johnson into U-turns — are concerned that Sunak’s premiership will bring a significant softening of the U.K.’s stance toward Beijing, given his past keenness on more economic cooperation. “I think we can expect continuity Boris, not continuity Truss,” one government official said. And on Russia, where the U.K. has been at the forefront of the tough Western response to the invasion of Ukraine, Sunak will need to decide how to respond if the U.S. position becomes more constrained.

On the agenda: Sunak is due to meet Biden and Indian PM Narendra Modi, according to reports. Playbook also hears there are talks over holding a bilat with Japan’s PM Fumio Kishida.

GDP stats — G20 preview — Kwasi twists the knife – POLITICO 2

HANCOCK WATCH

STILL WATCHING HANCOCK SO YOU DON’T HAVE TO: Matt Hancock’s first night’s sleep in the jungle came to an abrupt end after he was woken up by Boy George’s noisy morning meditation routine — not a sentence Playbook ever expected to write.

Cutting to the chase: Viewers of last night’s I’m a Celeb didn’t have long to wait before TV presenter Scarlett Douglas decided to address the elephant in the room. She brought up how Hancock had to resign after his breach of the COVID social distancing guidelines he set ended up on the front page of the Sun, and told him his behavior felt like a “slap in the face.”

Cringe: “I messed up and I fessed up,” was how Hancock put it when challenged by the comedian Babatúndé Aléshé later on, responding that while it’s no excuse, he “fell in love.” He joined millions of viewers in looking and feeling very uncomfortable as Aléshé described the circumstances that led to the former secretary of state for health and social care being forced to quit: “You were grabbing booty bruv … I didn’t expect a man like you to be grabbing booty.”

Moving swiftly on: Hancock then took on the day’s Bushtucker Trial: Tentacles of Terror. Essentially, it involved a giant rotating octopus model that dipped further underwater as time passed, with stars equivalent to meals hidden in the tentacles. It was also full of underwater critters, including eels, snakes (“you must have met a few snakes in Westminster” Ant and Dec quipped, obviously), crabs and a crocodile that got uncomfortably close. Hancock was tasked with swimming to the tentacles, ignoring the critters and unscrewing 11 stars to earn a meal for every campmate.

Fair play: Playbook — along with most of Westminster — has been taking the mickey out of Hancock this last week, so it’s only fair to acknowledge that he impressively overcame a pretty terrifying looking trial and won 11 stars out of 11. Hancock will hope his strong performance in the trial and in a separate assignment as a camp mole might win him some more friends.

Camp divided: In the Matt corner: Comedian Seann Walsh, who told the other campmates Hancock was “genuinely lovely” when they met as the two latecomers, plus Hollyoaks actor Owen Warner who applauded “man like Matt” for bringing home the stars … In the anti-Matt corner: Corrie’s Sue Cleaver, who said it didn’t sit well with her that Hancock was in the jungle as he has constituents back home without a reachable MP, plus the radio DJ Chris Moyles who agreed with Cleaver and spent much of the episode scowling in Hancock’s direction. Boy George isn’t too keen on his presence either (in response, as yesterday’s Popbitch noted, allies of Hancock have been bringing up George’s past conviction).

On your screens tonight: Hancock heads to the La Cucaracha Cafe — food trial klaxon — alongside Boy George.

Mentions of dyslexia: Still zero.

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TODAY IN WESTMINSTER

PARLIAMENT: Not sitting.

AT 11 AM: The U.K. will hold two minutes of silence to mark Armistice Day.

SCOOP — HANDLING MISCONDUCT: My indefatigable POLITICO colleague Esther Webber has uncovered details of new proposals that will be put to the parliamentary authorities in the hope of breaking a deadlock over how to deal with MPs suspected of serious misconduct. One option being considered is a panel of MPs which could review risk assessments on a case-by-case basis and determine whether an MP accused of sexual assault ought to be banned from the parliamentary estate, she hears. In the past, MPs have argued that the bar for exclusion ought to be when an MP is charged with an offense, but they are now being urged to look at triggering exclusion from the point of arrest.

What happens next: The Commons commission, the House’s managing body, is expected to receive a paper on Monday drawn up by senior Commons advisers. If it decides to act, procedural experts say the move would have to be approved by MPs but would not require legislation. Read more here.

A reminder: A Conservative MP in his 50s has been under arrest since May on suspicion of rape, sexual assault, indecent assault, abuse of a position of trust and misconduct in a public office. And Imran Ahmad Khan, the former Tory MP jailed earlier this year for sexually assaulting a child, showed up in parliament while awaiting trial despite promising to keep away from the estate.

HONORS CONTROVERSY: The House of Lords appointments commission has written to Sunak requesting a meeting over a string of Boris Johnson-proposed peerages, the Telegraph’s Rob Mendick reveals. He reports the watchdog is especially concerned about the nomination of former SpAd Charlotte Owens, who would be the youngest-ever life peer, he says. (At 30, former CCHQ political director Ross Kempsell would be the second-youngest.)

HEADLINES DON’T GET MUCH WORSE THAN THIS: The government handed a £700,000 contract to a company a few months after it was found to have tortured and killed dogs, the Mirror’s John Stevens reveals today. Grim.

MEANWHILE ON TWITTER: Northern Ireland Secretary Chris Heaton-Harris has been explaining what “tosh” means to Elon Musk.

Cutting in: Grant Shapps has written to Musk to remind him to comply with U.K. law and launch a collective consultation if he is planning to make more than 20 staff here redundant, the Guardian’s Jasper Jolly reports.

BEYOND THE M25

OVER AT COP27: After marking Armistice Day in Sharm El-Sheikh, COP26 president Alok Sharma will be speaking at a Bloomberg and COP26 U.K. presidency business reception this evening. Meanwhile, Business Secretary Grant Shapps is set for a second day of engagements and plans to contrast the global action on climate with the actions of eco-protestors like Just Stop Oil, urging them to actually “just stop.”

Watch this space: Playbook hears Shapps persuaded Sharma to record a TikTok video at the summit yesterday. We’ll be refreshing his feed today for signs of it.

PM MEETS PM: Taoiseach Micheál Martin has praised Rishi Sunak for meeting him and his “significant” decision to attend the British-Irish Council summit in Blackpool. Martin said that the mood music is improving on the NI protocol — Sunak, for his part, said he wanted to deepen ties between the U.K. and Ireland and that he was pleased with the progress made on the protocol in the early days of his premiership. POLITICO’s Shawn Pogatchnik has a write-up.

More positive noises: In an interview with the FT, outgoing EU Ambassador João Vale de Almeida said he believes the two sides are “not that far apart” on the protocol.

UKRAINE UPDATE: Kyiv says it has made key gains around Kherson, after Russia said it was withdrawing from the city. POLITICO’s Sergei Kuznetsov has more here.

Sanctions evasion: Iran is helping Russia by constructing an underground financial network that will allow the Kremlin to systematically evade sanctions, diplomats told POLITICO’s Matt Karnitschnig.

AS FOR THE MIDTERMS: Things still aren’t resolved over in the U.S., with the Republicans on track to reclaim the House but with control of the Senate coming down to two toss-up races and a runoff in Georgia. Follow the latest at POLITICO’s slick hub here.

**A message from Lloyds Banking Group: More than 6,000 of our staff served in the First World War. Nearly 1,000 did not return. These included Albert Victor Hipkiss, clerk at the Lloyds Bank Stourbridge branch, who in 1916 joined the 26th Royal Fusiliers, also known as the ‘Bankers’ Battalion’. Upon enlisting, Albert wrote to his manager, Frank Ragg, asking for his help in cashing a cheque and telling him “I haven’t met any Lloyds men as yet but am billeted with an exceedingly nice man from the Northamptonshire Union Wellingboro.” In all, 28 of the Lloyds men who joined the ‘Bankers Battalion’ did not make it back. Albert was among them. Our roll of honour commemorates staff who gave their lives in the First World War. Find out more.**

MEDIA ROUND

Today program: Former cancer czar Mike Richards (8.10 a.m.).

Times Radio breakfast: Former Deputy Minister of Justice of Ukraine Sergiy Petukhov (7.45 a.m.) … Former adviser to Vladimir Putin Sergei Markov (8.45 a.m.) … Former spokesperson for Tony Blair Tom Kelly (9.05 a.m.).

TODAY’S FRONT PAGES

(Click on the publication’s name to see its front page.)

Daily Express: ‘Tragedy’ for families if care costs cap is delayed.

Daily Mail: What is the point of these police?

Daily Mirror: Heroes denied truth.

Daily Star: Psycho seagull kicked my head in.

Financial Times: Wall St rallies as U.S. inflation falls to lowest since January.

HuffPostUK: Are Boris’ allies plotting Rishi’s exit?

i: Unions battle government in new winter of discontent.

Metro: Belittle Britain.

POLITICO UK: Wanted — A foreign policy for Britain.

PoliticsHome: Gavin Williamson row shows culture of ‘exceptionalism’ in politics, former cabinet minister says.

The Daily Telegraph: Use G20 talks to give peace a chance, U.S. tells Ukraine.

The Guardian: Calls for action as teachers reveal scale of pupil hunger.

The Independent: Strike that could bring U.K. grinding to a halt.

The Sun: Ferne sickens me to my stomach.

The Times: Kwarteng — I warned Truss over her radical reforms.

TODAY’S NEWS MAGS

The Economist: The Trump effect — How the midterms diminished the Republican Party.

THANK POD IT’S FRIDAY

Chopper’s Politics: Christopher Hope interviews Armed Forces Minister James Heappey and Shadow Defense Secretary John Healey.

Clear the Air: Mayor of London Sadiq Khan talks to Los Angeles Mayor Eric Garcetti.

Encompass: Paul Adamson is joined by the political documentary maker Michael Cockerell.

EU Confidential: POLITICO’s Suzanne Lynch in Brussels and Karl Mathiesen in Egypt interview COP26 President Alok Sharma and historian Mary Sarotte.

Iain Dale All Talk: Dale interviews former Tory MP Ann Widdecombe.

Inside Briefing: The IfG team is joined by ConservativeHome’s Henry Hill.

Newscast: The BBC team discuss the midterms.

The Bunker: Ros Taylor and IFS Director Paul Johnson analyze Jeremy Hunt’s options next week.

The Rundown: Former Work and Pensions Secretary Chloe Smith talks about Gavin Williamson’s resignation with PolHome’s Alain Tolhurst and Adam Payne.

Politics Weekly UK: The Guardian’s John Harris and Gaby Hinsliff discuss COP27 with Shadow Climate Secretary Ed Miliband.

On the Couch: Lucy Beresford talks about the migrant crisis with pollster and academic Matthew Goodwin.

Whitehall Sources: Calum Macdonald talks about the latest Downing Street drama with former No. 10 SpAds Kirsty Buchanan and Oscar Reddrop, plus former Corbyn adviser Frankie Leach.

YOUR WEEKEND IN POLITICS

STRIKES: Royal Mail staff will walk out for 48 hours on Saturday in a dispute over pay and terms.

BONGING AGAIN: The bells of Big Ben will return to regular service for the first time since 2017 with a bong to mark the two-minute silence at 11 a.m. on Sunday.

SUNDAY SHOWS: Laura Kuenssberg on the BBC (9 a.m.) will be talking to Chancellor Jeremy Hunt and Shadow Chancellor Rachel Reeves.

Sophy Ridge on Sky (Sky News, 8.30 a.m.) will also be joined by Reeves and Hunt, plus former Leveling Up Secretary Simon Clarke and Chief of the Defense Staff Tony Radakin.

Kate McCann and Adam Boulton on Times Radio (10 a.m.) will also be talking to Hunt and Reeves, plus Labour MP Hilary Benn.

Westminster Hour host Carolyn Quinn will be joined by Tory MP Stephen Crabb … Public accounts committee Chairwoman Meg Hillier … Institute of Director chief economist Kitty Ussher … The Mail’s Jason Groves (BBC Radio 4, 10 pm.):

LONDON CALLING

WESTMINSTER WEATHER: ☁️☁️☁️ Looks pretty gray BUT also warmer than the past few days. Highs of 17C.

NEW GIG: The FT’s Kiran Stacey — most recently out in Washington — is off to the Guardian, where he’ll join the paper’s Lobby team. Here’s the tweet.

BIRTHDAYS: Former Magistrates’ Association Chairman John Bache … Writer and broadcaster Cristina Odone.

Celebrating over the weekend: Shadow Justice Secretary Steve Reed … and his adviser Owain Mumford … Heywood and Middleton MP Chris Clarkson … Unaffiliated peer John Taylor, or Baron Kilcooney … BBC Politics Live presenter Jo Coburn … Science Media Centre Chief Executive Fiona Fox … Times Radio presenter Mariella Frostrup … Former Iranian President Hassan Rouhani … Shadow Crime Reduction Minister Naz Shah … Business committee Chairman Darren Jones … South Leicestershire MP Alberto Costa … BBC News presenter Christian Fraser … Times columnist Rachel Sylvester.

PLAYBOOK COULDN’T HAPPEN WITHOUT: My editor Zoya Sheftalovich, reporter Andrew McDonald and producer Grace Stranger.

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