The Prime Minister says the Government’s tax-cutting measures are the “right plan” despite growing market turmoil sparked by last week’s mini-budget.

Chancellor Kwasi Kwarteng unveiled a number of changes in last Friday’s announcement in the face of rising energy bills and the cost-of-living crisis.

However, markets have reacted negatively to the changes, with the value of the Sterling sinking to record lows against the US Dollar.

Liz Truss, making her first public comments since the mini-budget market chaos, defended the Chancellor’s measures, insisting “urgent action” was needed, although she admitted the Government’s decisions have been “controversial”.

The Oldham Times: PAPA (Image: PA)

The Prime Minister told BBC Radio Leeds: “We had to take urgent action to get our economy growing, get Britain moving and also deal with inflation.

“Of course that means taking controversial and difficult decisions but I am prepared to do that as Prime Minister because what is important to me is that we get our economy moving, we make sure that people are able to get through this winter and we are prepared to do what it takes to make that happen.”

She said the mini-budget was the “right plan”, in spite of mounting calls – including from the International Monetary Fund (IMF) – for a U-turn on some of the policies announced last Friday after the pound sunk to a record low against the US dollar on Monday.

On Wednesday, the Bank of England launched an emergency government bond-buying programme to prevent borrowing costs from spiralling out of control and stave off a “material risk to UK financial stability”.

The Bank announced it was stepping in to buy up to £65 billion worth of government bonds – known as gilts – at an “urgent pace” after fears over the Government’s economic policies sent the pound tumbling and sparked a sell-off in the gilts market, which threatened to spark the collapse of some UK pension funds.

The FTSE 100 Index has also been hit by marked volatility amid the bond sell-off and wider global recession fears, falling by nearly 2% in early trading on Thursday after a rollercoaster ride on Wednesday.