Nicola Sturgeon says UK economic crisis worst in memory

Scotland's first minister has warned that the UK could be facing a worse economic crisis than the 2008 global financial crash.

Nicola Sturgeon described the fallout from tax cuts announced by the Chancellor last week as "extraordinary and unprecedented".

Ms Sturgeon called for the UK government to reverse its income tax cuts for the highest earners.

She said the move would be a sign of "some kind of sense being restored".

The first minister was speaking as the Bank of England warned of a "material risk to UK financial stability" if the volatility continued.

It said it would start buying government bonds at an "urgent pace" to help restore "orderly market conditions".

The pound slumped in value by 1.6% against the dollar to $1.05 on Wednesday morning, while lenders withdrew about a quarter of mortgage products overnight as they grappled with the prospect of further rises in interest rates.

And the International Monetary Fund (IMF) has rebuked the government's ?45bn tax-cutting plans as being "risky" and likely to increase inequality.

Ms Sturgeon told a committee of senior MSPs at Holyrood that the Bank of England's intervention was "extraordinary" and showed that the UK was in the "grip of a rapidly deteriorating economic crisis".

And she said the mini-budget unveiled by Chancellor Kwasi Kwarteng last Friday had sparked the most serious situation for the UK economy in memory, possibly even including the 2008 global financial crisis which led to governments having to bail-out banks and other financial institutions.

The first minister called for immediate action to be taken, and for MPs to return early to the Parliament from recess.

And she said that "as an immediate symbol of some kind of good sense being restored, the decision to abolish the top rate of tax should be reversed".

Ms Sturgeon added: "I don't think it is possible to overstate the damage of this budget."