Downing Street celebrates the Royal Wedding
Forgive the hazy quality, but here's a photograph of the gathering street party outside No.
Forgive the hazy quality, but here's a photograph of the gathering street party outside No.
Gordon Brown may have gone, but advocates of his calamitous policies remain. David Blanchflower, the chief exponent of borrowing more, has a piece in The Guardian today which is worth examining. Written with his trademark chutzpah, it’s a very clear exposition of the Labour argument — along with its flaws. Here are some extracts, and my comments: "In his budget speech last month, Chancellor George Osborne suggested that he was hoping for 'an economy where the growth happens across the country and across all sectors. That is our ambition". Sadly, to judge by Wednesday's GDP figures, growth under this coalition remains just an ambition, a mere illusion." And why would that be? The GDP figures showed growth of 0.
The Royal wedding and gossip about super injunctions is rather dominating conversation at Westminster today. But there is still some politics going on. Patrick Wintour in The Guardian has the beginnings of the recriminations that will follow a No vote in the referendum. Relations between the Lib Dems and the Yes campaign are pretty bad at the moment. Clegg’s camp is happy to tell journalists about what they see as the myriad failings of the Yes campaign. They complain that the Yes campaign has been too slow on the draw, let the No side define the debate and failed to get any message across. The Yes campaign’s response to this has been to whisper in peoples’ ears that whenever Nick Clegg appears for Yes their numbers go down.
The government’s strained relationship with the Civil Service is a recurring story at the moment. Much of the disquiet seems to be the normal tit for tat exchanges immortalised in Yes Minister. In the main, ministers and their advisors express high regard for their officials. But there are some resilient bones of contention between the government and its lawyers. Again, this is not unusual. When Gordon Brown was Chancellor, parliamentary counsel were exasperated by his inability to take decisions. Brown’s budgetary machinations were finalised in a predictably mad rush, which incensed those who had to amend the bill hours before it was put to parliament.
He may no longer be an MP, but the spirit of James Purnell lingers on. It was, after all, the former Work and Pensions Secretary who introduced the Employment Support Allowance as a replacement for Incapacity Benefit in 2008, with the idea of encouraging people – the right people – away from sickness benefits and into the labour market. And now we have one of the strongest indications yet of just how that process is working. According to figures released by the DWP today, 887,300 of the 1,175,700 claimants who applied for ESA between October 2008 and August 2010 failed to qualify for any assistance – with 458,500 of them declared fit for work straight away, and 428,800 not completing their medical assessment. That's 75 per cent overall.
Aside from the "Calm down, dear" drama, there was something else worth noting from today's PMQs: David Cameron trying for a calmer debate on the deficit. He admitted that his government is not really being that much more aggressive than Gordon Brown would have been. They're cutting £8 for every £7 that Brown and Darling proposed for 2011-12, he said. It's a line that Nick Clegg road-tested in his speech to the IPPR last week, and it represents a new and welcome strategy. To date, the rhetorical differences have been stark. The Tories have said: we’re the big bold cutters, Labour are deficit deniers. Labour has replied: your cuts are too deep and too harsh, and the GDP figures prove it.
Blimey. That was a weird one. PMQs was trundling merrily away when the house was suddenly engulfed in a whirlwind of insults and accusations. Even now the row rumbles on across the blogosphere. Cameron arrived at PMQs looking genial and well-sunned. Quite a contrast with his sallow-faced opponent. Perhaps Ed Miliband’s bookish ways have kept him in the reading-room during the heat-wave while Cameron was roaming his herbaceous borders uprooting dandelions and other troublesome yellow-heads. The session began with the usual blend of opportunism and hypocrisy. Miliband demanded to know why economic growth has flat-lined in the last six months.
Or, rather, he's back in portrait form, as unveiled earlier today: And here it is in full, Prime Ministerial context:.
I have rarely heard the House as loud as it was after David Cameron’s ‘calm down, dear’ put down to Angela Eagle. The Labour benches roared at the Prime Minister and Cameron turned puce, while the Liberal Democrats looked distinctly uncomfortable. There is already a rather over-blown debate going on about whether the remark was sexist or not. But whether or not it was, it was certainly ill-judged. It was a tad too patronising and directing it at one of the more junior members of the shadow made it seem bullying. The Labour benches were heckling Cameron more than usual today, a result of him losing his rag with Ed Balls at PMQs last month. After today, they’ll turn the volume up another notch.
VERDICT: To paraphrase that famous football cliché, this was a session of two halves. Cameron put in a confident performance against what should have been the trickier set of questions: on the economy. But when it came to Ed Miliband's second topic of choice, the NHS, it all went suddenly awry. The PM's arguments were unusually messy and convoluted, lost in themselves. And he only made matters worse with his Winner-esque exhortation at a Labour frontbencher, "Calm down, dear!" You can argue whether it was sexist of the PM, or not, particularly as it's not clear whom the remark was aimed at (although the smart money's on Angela Eagle). But it was, at least, a moment of frustration that played up to the worst Flashman caricatures of the PM.
The coalition can breathe a little easier today. The economy returned to growth in the first quarter of this year, avoiding a double-dip recession. It expanded by 0.5 percent which is in the middle of City economists’ forecasts but below the OBR’s prediction of 0.8 percent. Recoveries are generally choppy and particularly so when coming out of a debt-induced recession. Labour, though, will see these numbers as a further chance to claim that cuts have sucked the confidence out of the economy and that Britain is just bumping along the bottom. This, obviously, isn’t the whole picture. The deficit reduction plan has, crucially, kept the cost of borrowing low and enabled a continuing monetary stimulus.
So, we're not back in recession, and growth of 0.5 per cent in the first quarter of this year is in line with what many forecasters were predicting, but... It is hardly indomitable stuff. As Duncan Weldon explained in a useful post yesterday – in which he rightly picked me up on a loosely worded post of my own (since, cheekily, edited) – 0.5 per cent merely compensates for the shrinkage experienced thanks to the snow last year. Across the last two quarters, economic growth has effectively plateaued. It's as we were, Q3 2010. The politics of the situation is fissile, even if we are stuck in the murky area of not-recession-but-not-strong-growth. There will undoubtedly be more pressure on the Coalition, from all sides, to ramp up their efforts for growth.
Something has undoubtedly changed in the coalition in the past fortnight. Even those at the centre, who have been most loyal to the concept of coalition, are now happy to complain about the other side and its behaviour. But I’m still sceptical of all the early election speculation which has been sparked by Jackie Ashley’s very clever Guardian column. The main reason why I don’t think it will happen is the Cameron brand. Ever since David Cameron became leader of the Conservative party, the top of the party has believed that the protection of the Cameron brand is essential to electoral success. Cameron has too much personally invested in showing that the coalition can work to let it fail. The coalition is now key to Cameron’s whole political persona.
It may look diminutive in between Easter and the Royal Wedding, but tomorrow is still a big day in the political calendar. It is, after all, the day when we hear the official growth estimate for the first quarter of this year. A negative number, and we shall have experienced two consecutive quarters of shrinkage — which is to say, the country will be back in recession. A positive number, and we shall have avoided that unhappy fate. So what are the forecasters saying? The consensus among bodies such as the NIESR and the CBI is around 0.5 percent, which – as Duncan Weldon explains in a very useful post – is barely enough to compensate for last quarter's snow-induced hit, but is still some sort of growth.
I have for a long time been sceptical of the idea that the AV referendum will damage the work of the coalition — even once the recriminations start to fly. Having seen it up close, I know how much effort both Tory and Lib Dem ministers actually put in to keep each other informed of their work and policies. Tory-led Departments often consult Lib Dems. And the PM and the DPM seem to have a better relationship than most of their predecessors had. They are certainly more ideologically aligned than Tony Blair was with John Prescott. Now Sam Coates says in The Times (£) that things are hitting the skids, with Tories deliberately blocking Lib Dems from gaining access to key documents and briefings. I don't doubt that this happens.
This week, breakage. Next week, super glue. Given the noises emanating from Downing Street, there's little doubt that the Tory and Lib Dem leaderships are going to do a repair job on the coalition once the AV referendum has been decided. As Rachel Sylvester puts it in her column (£) today, "Mr Cameron and Mr Clegg have had several amicable meetings to discuss how to handle the fall-out from the referendum. Both agree that whoever wins should be gracious, and allow the lower to take a bit more of the limelight in the weeks after the vote." They will be looking for quick and easily triggered bonding mechanisms, not least to repel Labour's charge that the coalition is damaged goods. But the question is: what do those bonding mechanisms look like?
By some dark magic, the Ghosts of New Labour have been roused from their political slumber. Over the extended weekend, we had news of Gordon Brown's new job and Alistair Darling's new book. Today, it is Peter Mandelson and Alan Johnson who are haunting the newspapers. Both give interviews – one to the Independent, one to the Guardian – with the same purpose: to rally the vote in favour of AV. Mandelson's is even front page news. "This is our chance to hurt Cameron," reads the headline, underneath a portrait of the man whom Labour learned to un-love after last year's election. Both interviews suggest that Labour are catching up with some of the risks attached to next week's referendum.
Can Ed Miliband and Ed Balls save Labour in Scotland? The two Labour heavyweights have decided to move in to rescue their party's disastrous campaign in Scotland — with Balls being sent up north to sharpen his party's teeth. A desperate measure for a desperate situation: Labour has not only blown a 10-15 point lead over the SNP in just a few weeks, but now languishes some 10-13 percentage points behind. A mammoth, humiliating defeat looms. Until now, Labour has liked to portray its campaign for the Holyrood elections as a totally Scottish affair: run in Scotland, organised in Scotland and led by Scottish politicians. Not any more.
Chris Huhne’s decision to threaten the Prime Minister with legal action — as I mentioned earlier — is particularly curious because he must be well-aware of the conflicts of interest at work in the Yes campaign. After all, his partner, Carina Trimingham is a director of Yes! and the Electoral Reform Society. She has been involved in this referendum from the start. And Mr Huhne must, therefore, know why Conservatives, and plenty of others, feel nervous about the relationships between the Electoral Reform Society who are running the Yes campaign and their business arm, Electoral Reform Services, who are financing the Yes campaign.