The Government’s austerity policy descended into chaos on 28 June as it first seemed to suggest it would abandon its one per cent cap on public sector pay rises, then denied it. Three Cabinet ministers appeared to have been briefed that the pay cap was coming to an end as they openly talked about lifting it, and Sir Oliver Letwin, the influential backbench MP, even went into detail about how taxes would have to be increased to fund it. However, only hours later Downing Street insisted that the cap would remain in place until 2020. This reversal was blamed on the ongoing ‘war’ between Theresa May and Philip Hammond, with the Treasury reportedly demanding a retraction of the announcement. It led to speculation that the Chancellor had intended to claim credit for the policy change at his next budget. Tim Farron, the outgoing Liberal Democrat leader, said: ‘The Tories are in utter chaos. They have U-turned on their own U-turn within the space of a few hours.’