David Miliband leaves the front bench

He has announced that he is leaving so as not to be a "distraction", and will continue to "support f

David Miliband has announced that he is not standing for the shadow cabinet to avoid being a "distraction" from his brother's leadership.

Justifying his decision to BBC News just now, Miliband said:

"I want to give him the freedom and the space to drive the party forward as he sees fit and support him from the backbenches. Ed needs a clean field to lead the party forward."

He also refused to rule out returning to front bench politics eventually, but said that he would always make the decision with the interests of the country and the party first. When asked whether his brother had asked him to stay, he said "that's a private discussion."

From his statement to his constituency party in South Shields:

On the day that nominations closed for the Shadow Cabinet, I think it right to explain to you and party members why I think I can best support him (Ed) from the back benches. The party needs a fresh start from its new leader, and I think that is more likely to be achieved if I make a fresh start. This has not been an easy decision, but having thought it through, and discussed it with family and friends I am absolutely confident it is the right decision for Ed, for the party, and for me and the family ...

This is now Ed's Party to lead and he needs to be able to do so as free as possible from distraction. Any new leader needs time and space to set his or her own direction, priorities and policies. I believe this will be harder if there is constant comparison with my comments and position as a member of the Shadow Cabinet. This is because of the simple fact that Ed is my brother, who has just defeated me for the Leadership. I genuinely fear perpetual, distracting and destructive attempts to find division where there is none, and splits where they don't exist, all to the detriment of the Party's cause.

You can read his full letter to his constituency party here.

Caroline Crampton is web editor of the New Statesman.

Photo: Getty Images
Show Hide image

There are risks as well as opportunities ahead for George Osborne

The Chancellor is in a tight spot, but expect his political wiles to be on full display, says Spencer Thompson.

The most significant fiscal event of this parliament will take place in late November, when the Chancellor presents the spending review setting out his plans for funding government departments over the next four years. This week, across Whitehall and up and down the country, ministers, lobbyists, advocacy groups and town halls are busily finalising their pitches ahead of Friday’s deadline for submissions to the review

It is difficult to overstate the challenge faced by the Chancellor. Under his current spending forecast and planned protections for the NHS, schools, defence and international aid spending, other areas of government will need to be cut by 16.4 per cent in real terms between 2015/16 and 2019/20. Focusing on services spending outside of protected areas, the cumulative cut will reach 26.5 per cent. Despite this, the Chancellor nonetheless has significant room for manoeuvre.

Firstly, under plans unveiled at the budget, the government intends to expand capital investment significantly in both 2018-19 and 2019-20. Over the last parliament capital spending was cut by around a quarter, but between now and 2019-20 it will grow by almost 20 per cent. How this growth in spending should be distributed across departments and between investment projects should be at the heart of the spending review.

In a paper published on Monday, we highlighted three urgent priorities for any additional capital spending: re-balancing transport investment away from London and the greater South East towards the North of England, a £2bn per year boost in public spending on housebuilding, and £1bn of extra investment per year in energy efficiency improvements for fuel-poor households.

Secondly, despite the tough fiscal environment, the Chancellor has the scope to fund a range of areas of policy in dire need of extra resources. These include social care, where rising costs at a time of falling resources are set to generate a severe funding squeeze for local government, 16-19 education, where many 6th-form and FE colleges are at risk of great financial difficulty, and funding a guaranteed paid job for young people in long-term unemployment. Our paper suggests a range of options for how to put these and other areas of policy on a sustainable funding footing.

There is a political angle to this as well. The Conservatives are keen to be seen as a party representing all working people, as shown by the "blue-collar Conservatism" agenda. In addition, the spending review offers the Conservative party the opportunity to return to ‘Compassionate Conservatism’ as a going concern.  If they are truly serious about being seen in this light, this should be reflected in a social investment agenda pursued through the spending review that promotes employment and secures a future for public services outside the NHS and schools.

This will come at a cost, however. In our paper, we show how the Chancellor could fund our package of proposed policies without increasing the pain on other areas of government, while remaining consistent with the government’s fiscal rules that require him to reach a surplus on overall government borrowing by 2019-20. We do not agree that the Government needs to reach a surplus in that year. But given this target wont be scrapped ahead of the spending review, we suggest that he should target a slightly lower surplus in 2019/20 of £7bn, with the deficit the year before being £2bn higher. In addition, we propose several revenue-raising measures in line with recent government tax policy that together would unlock an additional £5bn of resource for government departments.

Make no mistake, this will be a tough settlement for government departments and for public services. But the Chancellor does have a range of options open as he plans the upcoming spending review. Expect his reputation as a highly political Chancellor to be on full display.

Spencer Thompson is economic analyst at IPPR