The revolt against Osborne grows

Lib Dem MPs join economists in calling for a change of course.

Our exclusive story on how once supportive economists have turned against George Osborne has made the front page of today's Guardian, with the rest of Fleet Street, including the Mail and the Telegraph, also following up the piece, which appears in full in this week's magazine.

The Guardian leads on this week's New Statesman cover story.

And there's more bad news for Osborne today. The FT's Kiran Stacey reports that Lib Dem MPs are also now urging Osborne to take advantage of the UK's record low borrowing rates and stimulate growth through higher capital spending. John Pugh, the co-author of the party's 2010 economic policy, tells the paper:

We need to look again very carefully at the implications of the sharp reduction we have seen in capital expenditure.

There are a fair number of people who think that if we returned to the plans as conceived by Vince Cable . . . we would be in a slightly healthier position than we are.

Pugh is right. Osborne's decision to reduce capital expenditure - the most valuable spending, according to the OBR - by 48% (£24.3bn) is one of the main reasons why the UK, with the exception of Italy, is the only G20 member in recession.

When it was pointed out to Pugh that it would be difficult for the Chancellor to perform such a U-turn, he rightly replied:

The situation is serious enough now for people not to be bothered about what you call the plan.

Two other MPs - Annette Brooke and John Leech - make similar calls, and a senior economic adviser to the party comments: "We may have to resort to emergency measures to stimulate demand. We have already let the timetable on eliminating the deficit slip: we may have to do that again."

Perhaps most significantly, Stacey reports that party president Tim Farron is being urged by the Lib Dem leadership to call for deficit-funded spending "in order to give Nick Clegg, the deputy prime minister, a mandate to argue for it at the top of government."

The Lib Dems' restlessnes is unsurprising. As even the IMF has stated, there is no evidence that a reduced pace of deficit reduction would trigger a rise in British bond yields. With investors increasingly reluctant to lend to eurozone countries, the UK is, as Osborne has observed, a "safe haven". Yet, for no other reason other than political pride, the Chancellor is unwilling to change direction. Borrowing for growth would be a tacit admission that his nemesis, Ed Balls, was right and he was wrong. But until Osborne is prepared to take this step, there is no prospect of recovery, for either the economy or his party.

George Osborne is under increasing pressure to stimulate growth through higher infrastructure spending. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Who is in Jeremy Corbyn's new shadow cabinet?

Folllowing the resignation of over a dozen MPs, Jeremy Corbyn has begun appointing a new front bench.

Following an attempted coup over the weekend, Jeremy Corbyn has begun forming his new shadow cabinet, appointing MPs to replace the numerous front bench resignations that have taken place over the last 24 hours.

The cabinet is notable for containing a relatively large proportion of MPs from the 2015 intake, many of whom were also among the 36 MPs who nominated Corbyn as a leadership candidate last year. 

Emily Thornberry

Shadow Foreign Secretary

Thornberry, a former human rights barrister, served under Ed Miliband as shadow attorney general until she resigned in 2014 following a “snobbish” tweet about an England flag sent on the day of the Rochester by-election. The MP for Islington South since 2005, she returned to the shadow cabinet in 2010 as Jeremy Corbyn’s shadow employment minister, and then helped him out of a difficult position by accepting the position of shadow defence secretary in the January 2016 reshuffle after a spat between her predecessor, Angela Eagle, and Ken Livingstone.

Diane Abbott

Shadow Health Secretary

Diane Abbott, known for her forthright interventions on a wide variety of subjects as well as her zany appearances on the This Week sofa with Michael Portillo, has held a health brief before – she was shadow minister for public health under Ed Miliband (although she was sacked in 2013, saying “Ed wanted more message discipline”). A long-time ally of Corbyn’s – they had a brief relationship in the 1970s – she nominated him for the leadership and accepted the post of shadow international development secretary upon his victory in September 2015.

Pat Glass

Shadow Education Secretary

Pat Glass, a former Labour councillor in the north-east, was elected to parliament for North West Durham in 2010. She was initially appointed shadow education minister in September 2015 when Jeremy Corbyn first formed his shadow cabinet, and was then reshuffled to shadow Europe in January 2016. She now returns to her old brief.

Andy McDonald

Shadow Transport Secretary 

McDonald entered parliament in 2012 after the by-election following Stuart Bell’s death. He served Emily Thornbery as PPS from 2013, and then joined the shadow cabinet in January 2016 to replace Jonathan Reynolds as shadow minister for rail (Reynolds resigned in protest after Corbyn sacked Pat McFadden).

Clive Lewis

Shadow Defence Secretary

Clive Lewis is part of the 2015 intake, and has been a vocal supporter of Jeremy Corbyn. He was appointed shadow energy minister in September 2015, and has been staunch in his opposition to Trident renewal. He has military experience, having done a three-month combat tour of Afghanistan in 2009.

Rebecca Long-Bailey

Shadow Chief Secretary to the Treasury

Rebecca Long-Bailey is MP for Salford and Eccles elected in 2015. She previously worked as a solicitor, and was given the backing of Unite and Salford’s elected mayor Ian Stewart when she decided to run for parliament.

Long-Bailey was one of the MPs who nominated Corbyn for the leadership in 2015. After winning the leadership, Corbyn used her to replace Hilary Benn on Labour’s NEC.

Kate Osamor

Shadow International Development Secretary

Kate Osamor is the MP for Edmonton, also elected in 2015. She is Labour Co-operative politician, and was previously a GP practice manager.

Osamor also nominated Corbyn for leader. In January, she was made Shadow Minister for Women and Equalities.

Read a profile with Osamor from last year.

Rachael Maskell

Shadow Environment, Food and Rural Affairs Secretary

Rachael Maskell is the MP for York Central, elected in 2015. Before becoming an MP, she was a care-worker and physiotherapist in the NHS. She is committed to improving mental health services and has served on the Health Select Committee since July.

Until recently, she worked on the Shadow Defence Team under Maria Eagle.

Cat Smith

Shadow Voter Engagement and Youth Affairs

Cat Smith has been the MP for Lancaster and Fleetwood since 2015. Prfeviously Shadow Minister for Women, Smith worked for Corbyn before entering parliament, and was one of the 36 MPs to nominate him for the leadership in 2016.

Lancashire Constabulary are currently investigating allegations that Smith breached spending limits on election campaigning.

Dave Anderson

Shadow Northern Ireland Secretary

Dave Anderson has been the MP for Blaydon since 2005. He worked as a miner until 1989 and then subsequently as a care worker, during which time he was also an activist in UNISON.

He has been a member of the Northern Ireland Affairs Committee since 2005, with a longstanding interest in the Peace Process. In early 2015, Anderson was one of the signatories of an open letter to then leader Ed Miliband calling on Labour to oppose authority and renationalise the railways.