Miliband distances himself from the Balls strategy

Labour leader says the party should have spoken “openly and clearly” about the need for cuts.

It would be easy to dismiss Ed Miliband's admission that Labour was too slow to talk "openly and clearly" about the need for cuts as another piece of detail-free rhetoric. But, with Labour's internal politics in mind, it's a highly significant intervention.

Miliband's announcement puts more clear blue water between himself and Ed Balls, who, as Paul Waugh recently noted, still longs for the shadow chancellorship. It was Balls who used the Labour leadership election to make the argument that, had the party persisted with the Brownite mantra of "investment versus cuts", it could have won a fourth term. Faced with a choice between Labour cuts and Tory cuts, Balls argues, it was no surprise that voters opted for the real thing.

But others point to polling evidence that Labour's stance on cuts cost it votes as, in the public's view, state spending breached acceptable limits. Miliband isn't planning to look again at his proposed 60:40 ratio of spending cuts to tax rises, but he is suggesting that Labour's rhetoric on cuts left it open to the charge of "deficit denial".

What makes Miliband's intervention particularly significant is the increasing uncertainty around Alan Johnson's position. After yesterday's PMQs, during which David Cameron repeatedly joked that the shadow chancellor "can't count", it is clear that the Tories view Johnson as the weak link in Labour's armoury. And, after Sky News tripped him up on the employers' rate of National Insurance, Johnson can expect every broadcaster to pull a similar trick.

In the meantime, there is growing pressure from the left for Miliband to replace Johnson with either the popular Yvette Cooper (who topped Labour's shadow cabinet poll) or Ed Balls at some point in the near future. Yet the Labour leader's latest strategic move suggests Balls may have to wait a while longer for that promotion.

George Eaton is political editor of the New Statesman.

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Can Philip Hammond save the Conservatives from public anger at their DUP deal?

The Chancellor has the wriggle room to get close to the DUP's spending increase – but emotion matters more than facts in politics.

The magic money tree exists, and it is growing in Northern Ireland. That’s the attack line that Labour will throw at Theresa May in the wake of her £1bn deal with the DUP to keep her party in office.

It’s worth noting that while £1bn is a big deal in terms of Northern Ireland’s budget – just a touch under £10bn in 2016/17 – as far as the total expenditure of the British government goes, it’s peanuts.

The British government spent £778bn last year – we’re talking about spending an amount of money in Northern Ireland over the course of two years that the NHS loses in pen theft over the course of one in England. To match the increase in relative terms, you’d be looking at a £35bn increase in spending.

But, of course, political arguments are about gut instinct rather than actual numbers. The perception that the streets of Antrim are being paved by gold while the public realm in England, Scotland and Wales falls into disrepair is a real danger to the Conservatives.

But the good news for them is that last year Philip Hammond tweaked his targets to give himself greater headroom in case of a Brexit shock. Now the Tories have experienced a shock of a different kind – a Corbyn shock. That shock was partly due to the Labour leader’s good campaign and May’s bad campaign, but it was also powered by anger at cuts to schools and anger among NHS workers at Jeremy Hunt’s stewardship of the NHS. Conservative MPs have already made it clear to May that the party must not go to the country again while defending cuts to school spending.

Hammond can get to slightly under that £35bn and still stick to his targets. That will mean that the DUP still get to rave about their higher-than-average increase, while avoiding another election in which cuts to schools are front-and-centre. But whether that deprives Labour of their “cuts for you, but not for them” attack line is another question entirely. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.

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