Miliband's plan to force a vote on a "banking Leveson"

Labour leader repeat his favourite trick.

In announcing on ITV's Daybreak this morning that he will attempt to force a Commons vote on a Leveson inquiry for the banks, Ed Miliband is repeating the trick that has worked so well him for in the past. It was the threat of a vote that prompted News Corp to abandon its BSkyB bid and that led RBS boss Stephen Hester to relinquish his bonus. Labour will table an amendment to the Financial Services Bill, which is at committee stage in the House of Lords, calling for a public inquiry.

So far, the Tories and the Lib Dems have set themselves against one but Miliband can count on the support of a significant number of their MPs and much of the press, including the Daily Mail. In a leader in today's paper, the Mail declares:

Barclays chairman Marcus Agius is expected to quit today, increasing pressure on chief executive Bob Diamond to do the same.

But even that wouldn’t come close to lancing the boil. Doesn’t this latest sorry mess underline still more starkly the need for a Leveson-style inquiry into the whole banking industry?

Both Cameron and Clegg are resisting an inquiry on the grounds that it would slow down any police investigation but this fallacious argument was also used against Leveson. In his article for the Observer, Vince Cable wrote that a "costly Leveson-style public inquiry" (the Leveson inquiry is expected to cost £6m, a meaningless sum when the government spends more than a £700bn a year) would "certainly be enlivened by Ed Balls explaining why, in government, he allowed the regulatory mess to occur in the first place." Indeed it would. Is this not an argument for, rather than against an inquiry?

The longer Cameron resists demands for an inquiry, the greater the suspicion (for right or wrong) will be that he has "something to hide". If he is to tackle the public perception that the Tories are in cahoots with the banks, the pressure to act could become irresistible.

The Canary Wharf headquarters of Barclays Bank. 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.