Difficult decisions will be needed “across the board” on tax and spending, the new chancellor has told the BBC.

Speaking to the Today programme, Jeremy Hunt said some taxes will go up, while government spending may need to fall.

He said he had a "clean slate” after Prime Minister Liz Truss sacked Kwasi Kwarteng and announced another mini-budget U-turn on Friday.

Cutting the top rate of tax and not independently costing measures were mistakes being “put right”, he added.

Mr Hunt, a former foreign secretary who had not been part of Ms Truss’s cabinet, was made chancellor on Friday as the prime minister sought to restore confidence in her government.

In another dramatic day in Westminster, the prime minister also scrapped the plan to freeze corporation tax in another major U-turn.

Speaking in his first media interviews since becoming chancellor, Mr Hunt signaled a big shift away from the economic policies of the prime minister and his predecessor.

“Taxes are not going to come down by as much as people hoped, and some taxes will have to go up,” he said.

“I’m going to be asking all government departments to find additional efficiency savings.”

While he did not say where taxes could rise or public spending be reduced, Mr Hunt did not rule out cuts to NHS spending or rowing back on Ms Truss’s pledge to increase defence spending to 3% of GDP.

The chancellor, a Rishi Sunak supporter in the leadership contest, said the government needed to “show the world we have a plan that adds up financially”.

This is difficult, PM admits after major U-turn

Tory MPs turn on Liz Truss after turbulent day

Ms Truss, prime minister for just 39 days, is already facing pressure from within her party following September’s mini-budget, which included £45bn worth of tax cuts and sparked turbulence in the financial markets.

Mr Hunt said Ms Truss’s administration had made “mistakes”, adding: “It was wrong to cut the top rate of tax for the very highest earners at a time where we’re going to have to be asking for sacrifices from everyone to get through a very difficult period.

“And it was wrong to fly blind and to announce those plans without reassuring people with the discipline of the Office for Budget Responsibility (OBR) that we actually can afford to pay for them.”

He said both of these were now in the process of “being put right”.

This is difficult, Liz Truss admits after major U-turn

Tory MPs turn on Liz Truss after turbulent day

The chancellor made a series of other points about the government’s mini-budget and discussed possible plans for his new role in his interviews with the BBC:

He said he hoped to keep the 1% cut to the basic rate of income tax, but that no decisions had yet been made

He said he would keep the energy price guarantee and praised the former chancellor for implementing it

He Is asking government departments to find “efficiencies”, meaning possible cuts to spending

He also refused to commit to a pledge by Boris Johnson’s government to raise benefits in line with inflation, though he said he was mindful of the needs of the most vulnerable

Meanwhile, Bank of England Governor Andrew Bailey said there had been a “meeting of minds” when he held discussions with Mr Hunt on Friday.

Mr Bailey made the comments after hinting at impending fresh interest rate hikes.

“Inflationary pressures” meant a “stronger response” could be needed from the Bank than previously thought in August, the governor said.

On Friday, at a news conference, Ms Truss described sacking Mr Kwarteng and scrapping another key economic policy as “difficult” and admitted that “parts of our mini-budget went further and faster” than the markets were expecting.

Some MPs have told the BBC that “at least” her predecessor Boris Johnson managed occasionally to boost the morale of even his most ardent critics when things looked dire for the party.

Some Tory MPs feel Mr Hunt’s appointment has “bought them time,” with former Brexit Secretary David Davis telling GB News that the new chancellor had “shown himself to be fairly self-assured”.

But some who backed Ms Truss during the leadership contest are annoyed at the U-turns on some of her plans.

One Tory MP described the party as being in a “state of despair,” but Truss supporter Christopher Chope said “time will tell” if she had done enough to secure her position.

Labour leader Sir Keir Starmer has accused the prime minister of “grotesque chaos” following the sacking of the former chancellor. He is calling for a general election.

During a speech in Barnsley a day after the upheaval in Westminster, Sir Keir said Ms Truss was “clinging on”, arguing that there was “no historical precedent” for the current situation facing her government.

But Mr Hunt rejected suggestions of a general election, saying the country needs “stability”.

“[Truss] has been prime minister for less than five weeks. When we are judged at a general election, we will be judged by what we deliver over the next 18 months by far more than what’s happened over the last 18 weeks.”

But Mr Hunt is inheriting a “difficult and tricky situation”, according to director of the Institute for Fiscal Studies Paul Johnson.

“We’ve got very stretched public finances,” he said. “I think we’re going to see even further reversal of tax cuts that we’ve had, and in addition probably some very tight spending rounds.” (BBC)

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