Osborne lays the groundwork for IMF cash increase

The Chancellor has indicated that Britain could increase its IMF contribution - again. Tory Euroscep

George Osborne has said that Britain could provide more funds to the IMF if there is a "strong case" for an increase. Speaking at the World Economic Forum in Davos, the Chancellor said that he would consider increasing Britain's contributions above the £10bn extra already pledged, if there were adequate reassurances.

This is nothing new: Osborne has been laying the foundations for an increased British contribution for a while. It's vital for Britain that the IMF has enough cash to help struggling eurozone countries, because of our geographical position and trade links with Europe. But David Cameron gained some serious brownie points with his party when he opted out of further contributions to the eurozone bailout, and it will be difficult for the government to sell this as anything but propping up the eurozone by another name.

My colleague Rafael Behr recently explained why increasing IMF contributions is a political headache for Osborne:

The epicentre of instability is, of course, the eurozone, but Osborne cannot make an explicit commitment to bailout Britain's continental neighbours for fear of aggravating eurosceptic Tory backbenchers. Labour has also made it clear that it would oppose a direct transfer of UK money to a dedicated EU bailout fund - even one administered by the IMF. If enough Tories rebelled, a vote in parliament that ended up being framed in terms of whether or not good British pounds should be thrown after bad euros would be very tricky for the government. So any UK assistance to precarious eurozone economies has to be laundered through the general IMF kitty. (In practice that is hardly different from contributing to a specific euro bailout fund and eurosceptic rebels are unlikely to accept the distinction.)

Yet it looks as if it is edging closer to happening. The FT today reports that "Osborne has swept away most of the hurdles the government had erected to prevent Britain pledging billions of pounds for the International Monetary Fund", suggesting that the funds could be upped as soon as March.

Osborne will not be relishing the prospect of returning to parliament to ask for more funds -- particularly given the struggle he faced in July when the Commons voted on the last funding increase.

Sir Peter Tapsell summed up the feelings of many on the Conservative backbenches when he told David Cameron this week that "for Britain to commit still more funds to the IMF would, in effect, be providing a subsidy to Germany" because Berlin was not doing enough to support the euro.

The government is braced for a rebellion on this, but that will not mean it will not go ahead. It all comes down to Labour's position. The party sided with the sceptics in July (Ed Balls took a notably hostile position) but the Tory rebellion was not big enough to defeat the government. It's likely that there would be a higher turnout, and more strong feelings, in a repeat. The question is whether Labour decides to play the role of responsible global citizen (and some are reporting they might), or whether the chance to destabilise the coalition is too good to miss.

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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PMQs review: Theresa May shows again that Brexit means hard Brexit

The Prime Minister's promise of "an end to free movement" is incompatible with single market membership. 

Theresa May, it is commonly said, has told us nothing about Brexit. At today's PMQs, Jeremy Corbyn ran with this line, demanding that May offer "some clarity". In response, as she has before, May stated what has become her defining aim: "an end to free movement". This vow makes a "hard Brexit" (or "chaotic Brexit" as Corbyn called it) all but inevitable. The EU regards the "four freedoms" (goods, capital, services and people) as indivisible and will not grant the UK an exemption. The risk of empowering eurosceptics elsewhere is too great. Only at the cost of leaving the single market will the UK regain control of immigration.

May sought to open up a dividing line by declaring that "the Labour Party wants to continue with free movement" (it has refused to rule out its continuation). "I want to deliver on the will of the British people, he is trying to frustrate the British people," she said. The problem is determining what the people's will is. Though polls show voters want control of free movement, they also show they want to maintain single market membership. It is not only Boris Johnson who is pro-having cake and pro-eating it. 

Corbyn later revealed that he had been "consulting the great philosophers" as to the meaning of Brexit (a possible explanation for the non-mention of Heathrow, Zac Goldsmith's resignation and May's Goldman Sachs speech). "All I can come up with is Baldrick, who says our cunning plan is to have no plan," he quipped. Without missing a beat, May replied: "I'm interested that [he] chose Baldrick, of course the actor playing Baldrick was a member of the Labour Party, as I recall." (Tony Robinson, a Corbyn critic ("crap leader"), later tweeted that he still is one). "We're going to deliver the best possible deal in goods and services and we're going to deliver an end to free movement," May continued. The problem for her is that the latter aim means that the "best possible deal" may be a long way from the best. 

George Eaton is political editor of the New Statesman.