Inside Politics: Truss in with a chance

The race to become the next Tory leader is bubbling away, with just three candidates left in the field – how time flies. By the end of today that’ll become two.

Kemi Badenoch was the latest candidate to go in the final round yesterday, with Penny Mordaunt, Rishi Sunak and Liz Truss still left in the race. Badenoch’s transfers will device who goes through to the final two.

Inside the bubble

Today is the last day before the Commons summer parliamentary recess. There’ll be a prime minister’s questions session at 12, with another leadership vote in the Tory race in the afternoon shortly after that.

Results for the vote are expected at 4pm, and the big question will be where Kemi Badenoch’s transfers go. Rishi Sunak is practically guaranteed a place, so barring a major upset it’ll be him and either Penny Mordaunt or Liz Truss.

Daily Briefing

‘A big step forward’

Liz Truss’s hopes of replacing Boris Johnson as prime minister have taken a big step forward as rival Penny Mordaunt’s leadership bid stalled and a poll suggested the foreign secretary would comfortably beat MPs’ favourite Rishi Sunak in the final ballot of Tory members.

Both the Truss and Mordaunt camps were love-bombing defeated contender Kemi Badenoch, whose elimination in the fourth round of voting put her in the position of kingmaker.

And all three remaining contenders were battling for the votes of Ms Badenoch’s 59 supporters, who now have the power to decide who joins Mr Sunak in the final battle for the Tory leadership, which will be decided by party members on 5 September.

The 42-year-old former equalities minister herself looks set for a significant role in government whoever becomes PM, with rival camps hailing her “fantastic campaign” and “fresh thinking”.

Incredibly, a group of almost 2,000 Conservative members have also written to party chairman to demand they are given the option of voting for Boris Johnson in the leadership ballot.

The petition, first reported by The Telegraph, was organised by Tory donor Lord Cruddas and former Tory MEP David Campbell-Bannerman.

‘Agile approach’

Nadhim Zahawi has promised to repeal hundreds of pieces of EU finance law on UK statute books, part of government push to deregulate the City of London in a post-Brexit “Big Bang”.

The chancellor told the annual Mansion House bankers’ dinner that he wanted to replace Brussels rules with a more “agile approach” to financial regulation.

Mr Zahawi confirmed that the financial services bill will be introduced in parliament on Wednesday – claiming it would “unleash growth” in the banking sector.

It is partly aimed at allowing reform of Solvency II regime which governments the insurance market across Europe, aimed at give insurers more flexibility to invest in infrastructure.

The bill would give UK financial regulators a new objective to “promote growth” in the sector, rather than acting simply as a watchdog.

Elsewhere in Westminster Labour was in the spotlight. A long-awaited party inquiry found that anti-Corbyn Labour officials secretly diverted 2017 election resources to candidates hostile to the leadership and away from “winnable seats”.

The Forde report, said senior staff hostile to Jeremy Corbyn set up a parallel operation to “covertly divert money and personnel” to their favoured candidates.

The report, commissioned by Keir Starmer in the early days of his leadership, found that a “toxic” atmosphere prevailed in Labour HQ, with staff communicating via “WhatsApp ‘echo chambers’”, which amplified hostility and “allowed the boundaries of acceptable conduct to become blurred”.

The Forde inquiry was set up to look into allegations detailed in a party dossier leaked in April 2020 which contained transcripts of private WhatsApp messages from staff suggesting officials worked to politically undermine the party’s leadership.

On the record

“Though staff did not generally seek to exacerbate LOTO’s [Leader of the Opposition’s office] operational problems, which were seen as self-inflicted, they often passively observed or even welcomed them. Some comments do appear to show straightforward attempts to hinder LOTO’s work (in their view, for the party’s greater good).”

The Forde Report on Labour staff’s work under Jeremy Corbyn

From the Twitterati

Sunak trying to make all the debates and arguments go through him. It helps him that he’s in the middle of the set too

Sunday Times journalist Tim Shipman with his views on the Tory frontrunner

Essential reading

James Kirkup, The Spectator: The Conservative party has ceased to be serious

Marie Le Conte, The Independent: Labour now has a huge advantage over the Conservatives

Andrew Murrison, The Guardian: ‘Back anyone but Rishi’: that’s the message behind No 10’s hints at betrayal

Rachel Wearmouth, New Statesman: As Liz Truss surges, who is Labour’s dream Tory opponent?