Hester's bonus decision is a victory for Ed Miliband

It was Labour's plan to hold a Commons vote that forced the RBS chief to give up his £1m bonus.

It was Labour's plan to hold a Commons vote that forced the RBS chief to give up his £1m bonus.{C}

Explaining Stephen Hester's decision to waive his £1m bonus, RBS was clear that one man was responsible: Ed Miliband. It was Miliband's plan to force a Commons vote on the issue that prompted Hester's announcement last night. As one RBS director put it to the BBC's Robert Peston, it would have been "untenable" for a semi-nationalised bank to defy the will of parliament. Miliband probably would have preferred the row to continue for another week but this is still a significant victory for him. Like his intervention over the BSkyB deal, it is further evidence of his willingness to take on "vested interests".

For the coalition, which badly mishandled the issue, Hester's decision will come as a relief. It deprives Labour of an opportunity to inflict further damage on a dithering government. But the saga doesn't end here. Most bonuses are yet to be announced and Labour's intervention sets a significant precedent. As Faisal Islam pointed out, the logic of the party's position is that no one at RBS should receive a bonus of £1m. But around a hundred bankers pocketed that amount or more in 2010. Will Labour now scrutinise RBS pay more widely? The answer from Chuka Umunna on the Today programme this morning was "yes". He argued that RBS staff "like other public sector workers" should have their pay squeezed and promised to look at salaries "across the board".

But speaking for the government, William Hague sounded a cautionary note. He warned that politicians were not qualified to comment on "individual decisions" and the "day-to-day running of the banks". Then again, pointing to David Cameron's decision to ban cash bonuses above £2,000, he declared: "if we need to do more, we will do more." With RBS now likely to remain a state-owned institution until 2015 and beyond, both Labour and the Tories will have to think hard about how they ensure its pay is seen as fair in the eyes of the public. The government has every interest in avoiding a repeat of the furore next January.

George Eaton is political editor of the New Statesman.

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Theresa May is paying the price for mismanaging Boris Johnson

The Foreign Secretary's bruised ego may end up destroying Theresa May. 

And to think that Theresa May scheduled her big speech for this Friday to make sure that Conservative party conference wouldn’t be dominated by the matter of Brexit. Now, thanks to Boris Johnson, it won’t just be her conference, but Labour’s, which is overshadowed by Brexit in general and Tory in-fighting in particular. (One imagines that the Labour leadership will find a way to cope somehow.)

May is paying the price for mismanaging Johnson during her period of political hegemony after she became leader. After he was betrayed by Michael Gove and lacking any particular faction in the parliamentary party, she brought him back from the brink of political death by making him Foreign Secretary, but also used her strength and his weakness to shrink his empire.

The Foreign Office had its responsibility for negotiating Brexit hived off to the newly-created Department for Exiting the European Union (Dexeu) and for navigating post-Brexit trade deals to the Department of International Trade. Johnson was given control of one of the great offices of state, but with no responsibility at all for the greatest foreign policy challenge since the Second World War.

Adding to his discomfort, the new Foreign Secretary was regularly the subject of jokes from the Prime Minister and cabinet colleagues. May likened him to a dog that had to be put down. Philip Hammond quipped about him during his joke-fuelled 2017 Budget. All of which gave Johnson’s allies the impression that Johnson-hunting was a licensed sport as far as Downing Street was concerned. He was then shut out of the election campaign and has continued to be a marginalised figure even as the disappointing election result forced May to involve the wider cabinet in policymaking.

His sense of exclusion from the discussions around May’s Florence speech only added to his sense of isolation. May forgot that if you aren’t going to kill, don’t wound: now, thanks to her lost majority, she can’t afford to put any of the Brexiteers out in the cold, and Johnson is once again where he wants to be: centre-stage. 

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.