Chancellor's autumn statement isn't quite Austerity 2.0 - but it will still hurt

Barely a month ago, a majority of the Conservative Party pushed out a sitting prime minister after deciding she went too far in a budget.

Almost incredibly, that question is back.

Now some in the Tory party (a different group, unsurprisingly, and not nearly as many) are asking whether Rishi Sunak and Jeremy Hunt will go too far in Thursday’s autumn statement – albeit firmly in the opposite direction.

If Liz Truss was addicted to spending and borrowing, Mr Sunak wants to be the premier fiscal hawk in Britain, unafraid to take difficult decisions and cut the state.

But this comes at a political, as well as an actual, cost.

Chancellor to unveil autumn statement at 11.30am – watch on Sky News and follow live in the politics hub

Tax rises which lost Mr Sunak the leadership election over the summer are on the agenda, as are stealth taxes taking millions in higher rate bands and spending cuts to local councils that will horrify Tory councillors.

It isn’t quite Austerity 2.0 – after 2025 budgets will still rise in absolute terms but less than inflation – and this will still hurt.

As a result of all of this, it won’t be possible to get all Tory MPs singing from the same hymn sheet at Mr Hunt’s Thursday memorial service for Trussonomics.

Some, like Iain Duncan Smith, will warn tax rises will choke off growth, while others like Esther McVey insist HS2 is cut before she endorses Thursday’s plan.

Simon Clarke will continue to warn not to blame everything on Ms Truss, while others are asking if they are exaggerating the scale of the black hole for political ends.

Ms Truss only stopped being prime minister, and defended to the hilt, barely a month ago – so it’s not surprising the ghost of her premiership lives on in parts of the Conservative Party.

It will be interesting to see if she is on the backbenches for the statement.

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Mr Hunt will try to glue the Conservative party together with two important concessions. Amid below inflation settlements for much of Whitehall after 2025, I understand that there will be some form of special protection for the schools budget.

There was a weekend backlash from Tory MPs fearing education cuts, and Mr Sunak has made schools a priority, so he and his chancellor are sending an important signal with this decision.

The second is an important U-turn. On entering office, Mr Hunt made clear he was scrapping the universal energy support package to shield everyone from spiralling bills.

I’m told the price cap set by regulator Ofgem is set to rise again next year to £4,000 for the average household – judged by ministers to be unaffordable for many.

They will therefore offer help for everyone – copying the Truss scheme which sees the government paying more than a certain amount per unit.

The rate will be less generous, but the principle – denounced by many as unsafe for the markets – will remain the same.

Will these two rabbits be enough to calm the Tory troops and keep the public on side? Will Labour find an effective line of attack so far not evident in their approach to the economic policy of the new government?

Mr Sunak will find out soon enough.