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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How worried are Labour MPs about losing their seats?

Despite their party's abysmal poll ratings, MPs find cause for optimism on the campaign trail. 

Labour enters the general election with subterranean expectations. A "good result", MPs say, would be to retain 180-200 of their 229 MPs. Some fear a worse result than 1935, when the party won just 154 seats. Rather than falling, the Conservatives' poll lead has risen as the prospect of electing a government concentrates minds (last night's YouGov survey, showing the Tories a mere 16 points ahead, was an exception).

Though Conservative strategists insist they could lose the election, in an attempt to incentivise turnout, their decision to target Labour MPs with majorities as high as 8,000 shows the scale of their ambitions (a Commons majority of circa 150 seats). But as well as despair, there is hope to be found in the opposition's ranks.

Though MPs lament that Jeremy Corbyn is an unavoidable drag on their support, they cite four reasons for optimism. The first is their local reputation, which allows them to differentiate themselves from the national party (some quip that the only leaflets on which Corbyn will feature are Tory ones). The second is that since few voters believe the Labour leader can become Prime Minister, there is less risk attached to voting for the party (a point some MPs make explicit) "The problem with Ed Miliband and the SNP in 2015 was that it was a plausible scenario," a shadow minister told me. "It was quite legitimate for voters to ask us the question we didn't want to answer: 'what would you do in a hung parliament?' If voters have a complaint it's usually about Jeremy but it's not the case that he looks like he can become prime minister."

The third reason is the spectre of an omnipotent Tory government. MPs appeal to voters not to give Theresa May a "free hand" and to ensure there is some semblance of an opposition remains. Finally, MPs believe there is an enduring tribal loyalty to Labour, which will assert itself as polling day approaches. Some liken such voters to sports fans, who support their team through thick and thin, regardless of whether they like the manager. Outgoing MP Michael Dugher (who I interviewed this week) was told by an elderly woman: "Don't worry, love, I will still vote Labour. I vote for you even when you're rubbish."

Ben Bradshaw, the long-serving MP for Exter, who has a majority of 7,183, told me: "We're not anything for granted of course. On the current national polling, the Tories would take Exeter. But having covered five polling districts, although the leadership is undoubtedly a big issue on the doorstep, most people say they'll still vote for me as their local MP and we're not detecting any significant shift away from 2015. Which is slightly puzzling given the chasm in the opinion polls." Bradshaw also promotes himself as "the only non-Tory MP in the south-west outside Bristol": a leaflet shows a blue-splattered map with a lone red dot. The Labour MP warns voters not to be left in a "one-party state". 

As in 2010, Labour may yet retain more seats than its vote share suggests (aided by unchanged boundaries). But the fate of the Liberal Democrats in 2015 - when the party was reduced from 56 MPs to eight - shows that local reputations are worth less than many suppose. Theresa May has succeeded in framing herself as a figure above party interests, who needs a "strong hand" in the Brexit negotiations. At the very moment when a vigorous opposition is needed most, Labour has rarely been weaker. And when the public turn resolutely against a party, even the best men and women are not spared.  

George Eaton is political editor of the New Statesman.

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