Will Osborne now appear before the Leveson inquiry?

Chancellor likely to be summoned this month.

In total, seven government ministers will appear before the Leveson inquiry. Vince Cable, Ken Clarke, Michael Gove, Jeremy Hunt and Theresa May have already done so, with David Cameron and Nick Clegg set to follow them later this month. Yet, absurdly, George Osborne, the man who recruited Andy Coulson, who met Murdoch executives 16 times following the general election and who, in the words of Rebekah Brooks, expressed "total bafflement" at Ofcom's response to the BSkyB bid, is currently not scheduled to appear. The Chancellor will merely be required to submit a witness statement.

One of the questions following Jeremy Hunt's appearance is whether this will now change. The texts exchanged between him and Osborne suggest that the Chancellor, as David Cameron's chief strategist (Osborne's dual role goes some way to explaining his botched Budget), played a decisive role in the handling of the BSkyB bid. It was to Osborne, who some might have imagined to be preoccupied with the task of running the British economy, that Hunt addressed his fear that "we are going to screw this up". He later added: "Just been called by James M. His lawyers are meeting now and saying it calls into question legitimacy of whole process from beginning 'acute bias' etc". To which Osborne infamously replied: "I hope you like the solution!" The solution being to hand Hunt, a cheerleader for the Murdochs (the most egregious example being the congratulatory text to James Murdoch, in which he declared: "Only Ofcom to go!"), ministerial responsibility for the BSkyB bid. The exchanges between Murdoch and Hunt, and Hunt and Osborne, raise the possibility that Murdoch and Osborne communicated on 21 December, perhaps minutes before Osborne's text to Hunt.

Fortunately, it now seems likely that the Chancellor will be forced to appear in person and that his own texts and emails with News Corp will be published. Today's Daily Mail reports that the Osborne "will be summoned alongside David Cameron, who is expected to give evidence on June 14." If so, his appearance could provide some of the most damaging revelations yet.


Chancellor of the Exchequer George Osborne exchanged texts with Jeremy Hunt on the BSkyB bid. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Why relations between Theresa May and Philip Hammond became tense so quickly

The political imperative of controlling immigration is clashing with the economic imperative of maintaining growth. 

There is no relationship in government more important than that between the prime minister and the chancellor. When Theresa May entered No.10, she chose Philip Hammond, a dependable technocrat and long-standing ally who she had known since Oxford University. 

But relations between the pair have proved far tenser than anticipated. On Wednesday, Hammond suggested that students could be excluded from the net migration target. "We are having conversations within government about the most appropriate way to record and address net migration," he told the Treasury select committee. The Chancellor, in common with many others, has long regarded the inclusion of students as an obstacle to growth. 

The following day Hammond was publicly rebuked by No.10. "Our position on who is included in the figures has not changed, and we are categorically not reviewing whether or not students are included," a spokesman said (as I reported in advance, May believes that the public would see this move as "a fix"). 

This is not the only clash in May's first 100 days. Hammond was aggrieved by the Prime Minister's criticisms of loose monetary policy (which forced No.10 to state that it "respects the independence of the Bank of England") and is resisting tougher controls on foreign takeovers. The Chancellor has also struck a more sceptical tone on the UK's economic prospects. "It is clear to me that the British people did not vote on June 23 to become poorer," he declared in his conference speech, a signal that national prosperity must come before control of immigration. 

May and Hammond's relationship was never going to match the remarkable bond between David Cameron and George Osborne. But should relations worsen it risks becoming closer to that beween Gordon Brown and Alistair Darling. Like Hammond, Darling entered the Treasury as a calm technocrat and an ally of the PM. But the extraordinary circumstances of the financial crisis transformed him into a far more assertive figure.

In times of turmoil, there is an inevitable clash between political and economic priorities. As prime minister, Brown resisted talk of cuts for fear of the electoral consequences. But as chancellor, Darling was more concerned with the bottom line (backing a rise in VAT). By analogy, May is focused on the political imperative of controlling immigration, while Hammond is focused on the economic imperative of maintaining growth. If their relationship is to endure far tougher times they will soon need to find a middle way. 

George Eaton is political editor of the New Statesman.