David Miliband lashes coalition over position on Europe

Splits between Lib Dems and Tories dramatically exposed.

From the Commons chamber:

David Miliband, the shadow foreign secretary and front-runner in the Labour leadership, is currently taking apart the Europe policy of the Conservative-Lib Dem coalition.

Earlier, William Hague, the new Foreign Secretary, tried to ridicule Miliband by saying that "the situation has changed" and that Miliband will have to "agree" with him over various cross-party issues.

But on Europe, Miliband did not hold back, pointing out that the Deputy Prime Minister himself, Nick Clegg, has called the Tories' new EU allies "nutters". He also quoted the Hague describing the Lib Dems as "fanatical federalists".

Finally, Miliband said that while the Foreign Secretary was good at "jokes", his new job would, "for the first time in a long time", require him to have "judgement".

Miliband's contribution has just been described as a "leadership speech" by Ming Campbell. That is unfair, because Miliband has offered similar messages repeatedly in recent years.

But there is no doubt that he has just shown -- with the force of his argument and his ability to take apart this rather awkwardly balanced coalition -- why he is front-runner to lead Labour and take on the Cameron-led government.

James Macintyre is political correspondent for the New Statesman.
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Scotland's vast deficit remains an obstacle to independence

Though the country's financial position has improved, independence would still risk severe austerity. 

For the SNP, the annual Scottish public spending figures bring good and bad news. The good news, such as it is, is that Scotland's deficit fell by £1.3bn in 2016/17. The bad news is that it remains £13.3bn or 8.3 per cent of GDP – three times the UK figure of 2.4 per cent (£46.2bn) and vastly higher than the white paper's worst case scenario of £5.5bn. 

These figures, it's important to note, include Scotland's geographic share of North Sea oil and gas revenue. The "oil bonus" that the SNP once boasted of has withered since the collapse in commodity prices. Though revenue rose from £56m the previous year to £208m, this remains a fraction of the £8bn recorded in 2011/12. Total public sector revenue was £312 per person below the UK average, while expenditure was £1,437 higher. Though the SNP is playing down the figures as "a snapshot", the white paper unambiguously stated: "GERS [Government Expenditure and Revenue Scotland] is the authoritative publication on Scotland’s public finances". 

As before, Nicola Sturgeon has warned of the threat posed by Brexit to the Scottish economy. But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose dramatic austerity. 

Sturgeon is undoubtedly right to warn of the risks of Brexit (particularly of the "hard" variety). But for a large number of Scots, this is merely cause to avoid the added turmoil of independence. Though eventual EU membership would benefit Scotland, its UK trade is worth four times as much as that with Europe. 

Of course, for a true nationalist, economics is irrelevant. Independence is a good in itself and sovereignty always trumps prosperity (a point on which Scottish nationalists align with English Brexiteers). But if Scotland is to ever depart the UK, the SNP will need to win over pragmatists, too. In that quest, Scotland's deficit remains a vast obstacle. 

George Eaton is political editor of the New Statesman.