Rishi Sunak faces an uphill battle in his bid to become prime minister after suffering further setbacks as rival Liz Truss won another major endorsement and pulled ahead in new polling of Tory voters.

The former chancellor was on the defensive over tax again in a crunch interview with Andrew Neil on Friday, rejecting accusations that his policies would result in recession and warning that Ms Truss’s plans for vast tax cuts would pour “fuel on the fire” of inflation.

But the Foreign Secretary’s tax pledge won over former Tory leadership rival Tom Tugendhat, who described them as being “founded on true Conservative principles” as he came out in support of her.

 

With Ms Truss’s tax plans seeing her consistently leading in polls, Mr Sunak performed a U-turn this week by promising to temporarily slash VAT on energy bills.

However, the policy appears to have failed to shore up support among Tory voters – who include the party members electing the next prime minister – of whom 43% believe Ms Truss would do a better job, compared with 32% for Mr Sunak, according to a BMG Research poll for the i newspaper.

In a bid to regain his footing in the contest before ballot papers begin dropping through letterboxes of the party faithful next week, Mr Sunak will on Saturday give a speech attacking “woke nonsense”.

In hardened rhetoric on identity politics, he is expected to tell supporters in West Sussex that he will prevent “left-wing agitators” from taking “a bulldozer to our history, our traditions and our fundamental values”.

He will vow to review the 2010 Equality Act, which he will call a “Trojan horse that has allowed every kind of woke nonsense to permeate public life”.

Mr Sunak was grilled by the veteran political journalist on the economy, immigration and his wife’s tax status for nearly half an hour in his Channel 4 interview, in which Ms Truss has so far declined to take part.

Mr Neil challenged Mr Sunak over his plans to tighten fiscal policy at a time when “the global economy grinds to a halt, as monetary policy has been tightening”, suggesting he would “ensure a recession”.

Mr Sunak said: “I think it’s absolutely the right thing to do to not put fuel on the fire of the inflation problem that we already have.

“What we should do is focus on long-term growth because that’s what we need, sustainable growth, not a sugar rush boom that will make us feel better for months, but then it runs out of control, let inflation get set into the system, let the Bank of England have to react with even higher interest rates.”

Mr Sunak said a recession was “not the forecast of the majority of most independent forecasters here in the UK” and denied that his pledge to cut VAT on energy bills was a U-turn that demonstrated “bad judgment”.

Tom Tugendhat Former Tory leadership candidate Tom Tugendhat is backing Liz Truss (Yui Mok/PA)

On immigration, Mr Neil pressed him on why he wanted to turn away “even legal asylum seekers”.

Mr Sunak replied: “Because there is a finite amount of asylum seekers that we are able to integrate and accommodate.

“At any moment in time, Andrew, there are probably a billion people that would love to move to the UK because this is an amazing country, so we clearly can’t accept all of those.”

The millionaire ex-chancellor looked uncomfortable as he batted away questions about his wife’s previous non-domiciled tax status – an arrangement which reportedly saved her millions, saying: “I’m the one running for office and not my wife.”

Mr Sunak’s fiscal policy came under fire from new Truss supporter Mr Tugendhat, who wrote in The Times that it is “not right” that the tax burden should be rising when people are heading into winter with “dread”.

 
 

The chairman of the Foreign Affairs Select Committee was the latest heavyweight to come out in support of Ms Truss following Defence Secretary Ben Wallace’s earlier endorsement, and is significant as he is popular among Tory members and a senior figure in the One Nation group of centrist Tory MPs.

Asked during a visit to Norfolk on Friday if she was confident she was now set to win the contest, Ms Truss said: “I’m not at all complacent. I’m fighting for every vote across the country.”

In a thinly veiled swipe at the former chancellor’s record, the Foreign Secretary said it would be “risky” for the country to continue along the current economic path.

Ms Truss said the way to get growth is to “help people and businesses keep more of their own money”, saying the “number one priority should be avoiding recession”.