Cameron announces another squeeze on welfare

PM says he will look again at abolishing housing benefit for the under-25s.

David Cameron's appearance on The Andrew Marr Show this morning was proof that his political woes have not dented his supreme confidence. The PM boasted that he was on his "fourth leader of the Labour Party" (only if one includes Harriet Harman) and revealed that he had told Boris Johnson: "once you've done your job as London Mayor, don't think your job in politics is over." Boris, one suspects, rather agrees.

Cameron offered a preview of the message that will dominate the Conservative conference: we are facing up to the deficit, which Labour has "nothing to say about". He boasted that the government had reduced the deficit by a quarter since entering office and had created a million new private sector jobs. The reality isn't so positive. The deficit has fallen but, owing to the recession, borrowing so far this year is 22% higher than in the same period last year and the government is expected to miss its deficit target for 2012 by as much as £30bn. Private sector employment has risen by a million but 196,000 of these jobs were reclassified from the public sector and, after falling in recent months, unemployment is expected to rise next year.

Elsewhere, after already announcing £18bn of welfare cuts, Cameron signalled that the government was coming back for more. He suggested that he would look again at abolishing housing benefit for the under-25s and at reducing working age welfare more generally (universal benefits for the elderly are, for now, safe). But he vowed that these measures would be combined with plans to raise more from the rich. George Osborne has ruled out the introduction of a "mansion tax" and higher council tax bands, but Cameron insisted he would find other ways of ensuring the rich pay their "fair share". "We will always be fair and be seen to be fair," he declared, a test that the decision to abolish the 50p tax rate clearly failed. If he is to secure Liberal Democrat agreement for further welfare cuts, he will need to offer something more than another "crackdown" on tax avoidance (making the rich pay taxes they're meant to be paying anyway, is not the same as raising taxes on the rich).

Economic recovery remains the precondition for Cameron's political recovery and, asked if he saw "green shoots", the PM replied that he was not "a forecaster". But even if the economy returns to growth this quarter, the problem for Cameron remains that most people will still be getting poorer. A freeze in council tax and a cap on train fare rises of 1% above inflation will do little to ease the pain.

David Cameron arrives in Birmingham with his wife Samantha Cameron for the Conservative conference. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Is defeat in Stoke the beginning of the end for Paul Nuttall?

The Ukip leader was his party's unity candidate. But after his defeat in Stoke, the old divisions are beginning to show again

In a speech to Ukip’s spring conference in Bolton on February 17, the party’s once and probably future leader Nigel Farage laid down the gauntlet for his successor, Paul Nuttall. Stoke’s by-election was “fundamental” to the future of the party – and Nuttall had to win.
 
One week on, Nuttall has failed that test miserably and thrown the fundamental questions hanging over Ukip’s future into harsh relief. 

For all his bullish talk of supplanting Labour in its industrial heartlands, the Ukip leader only managed to increase the party’s vote share by 2.2 percentage points on 2015. This paltry increase came despite Stoke’s 70 per cent Brexit majority, and a media narrative that was, until the revelations around Nuttall and Hillsborough, talking the party’s chances up.
 
So what now for Nuttall? There is, for the time being, little chance of him resigning – and, in truth, few inside Ukip expected him to win. Nuttall was relying on two well-rehearsed lines as get-out-of-jail free cards very early on in the campaign. 

The first was that the seat was a lowly 72 on Ukip’s target list. The second was that he had been leader of party whose image had been tarnished by infighting both figurative and literal for all of 12 weeks – the real work of his project had yet to begin. 

The chances of that project ever succeeding were modest at the very best. After yesterday’s defeat, it looks even more unlikely. Nuttall had originally stated his intention to run in the likely by-election in Leigh, Greater Manchester, when Andy Burnham wins the Greater Manchester metro mayoralty as is expected in May (Wigan, the borough of which Leigh is part, voted 64 per cent for Brexit).

If he goes ahead and stands – which he may well do – he will have to overturn a Labour majority of over 14,000. That, even before the unedifying row over the veracity of his Hillsborough recollections, was always going to be a big challenge. If he goes for it and loses, his leadership – predicated as it is on his supposed ability to win votes in the north - will be dead in the water. 

Nuttall is not entirely to blame, but he is a big part of Ukip’s problem. I visited Stoke the day before The Guardian published its initial report on Nuttall’s Hillsborough claims, and even then Nuttall’s campaign manager admitted that he was unlikely to convince the “hard core” of Conservative voters to back him. 

There are manifold reasons for this, but chief among them is that Nuttall, despite his newfound love of tweed, is no Nigel Farage. Not only does he lack his name recognition and box office appeal, but the sad truth is that the Tory voters Ukip need to attract are much less likely to vote for a party led by a Scouser whose platform consists of reassuring working-class voters their NHS and benefits are safe.
 
It is Farage and his allies – most notably the party’s main donor Arron Banks – who hold the most power over Nuttall’s future. Banks, who Nuttall publicly disowned as a non-member after he said he was “sick to death” of people “milking” the Hillsborough disaster, said on the eve of the Stoke poll that Ukip had to “remain radical” if it wanted to keep receiving his money. Farage himself has said the party’s campaign ought to have been “clearer” on immigration. 

Senior party figures are already briefing against Nuttall and his team in the Telegraph, whose proprietors are chummy with the beer-swilling Farage-Banks axis. They deride him for his efforts to turn Ukip into “NiceKip” or “Nukip” in order to appeal to more women voters, and for the heavy-handedness of his pitch to Labour voters (“There were times when I wondered whether I’ve got a purple rosette or a red one on”, one told the paper). 

It is Nuttall’s policy advisers - the anti-Farage awkward squad of Suzanne Evans, MEP Patrick O’Flynn (who famously branded Farage "snarling, thin-skinned and aggressive") and former leadership candidate Lisa Duffy – come in for the harshest criticism. Herein lies the leader's almost impossible task. Despite having pitched to members as a unity candidate, the two sides’ visions for Ukip are irreconcilable – one urges him to emulate Trump (who Nuttall says he would not have voted for), and the other urges a more moderate tack. 

Endorsing his leader on Question Time last night, Ukip’s sole MP Douglas Carswell blamed the legacy of the party’s Tea Party-inspired 2015 general election campaign, which saw Farage complain about foreigners with HIV using the NHS in ITV’s leaders debate, for the party’s poor performance in Stoke. Others, such as MEP Bill Etheridge, say precisely the opposite – that Nuttall must be more like Farage. 

Neither side has yet called for Nuttall’s head. He insists he is “not going anywhere”. With his febrile party no stranger to abortive coup and counter-coup, he is unlikely to be the one who has the final say.