Balls would "retire to the back benches" if Miliband tried to move him

Allies of the shadow chancellor tell Kevin Maguire that he won't accept another job in the shadow cabinet.

Commentators have recently taken to suggesting that Ed Balls could be replaced as shadow chancellor before the next election, with David Miliband and Alistair Darling touted as possible replacements. The latest round of speculation began after Balls revealed that Miliband hadn't guaranteed his position. He told the Times (£): "I’ve never asked him. It’s a bit arrogant thinking about what sort of job you do."

In tomorrow's issue of the NS, Kevin Maguire offers a spirited defence of the shadow chancellor and reveals that Balls would "retire to the back benches rather than swallow demotion to another portfolio". He also reports that Miliband would "face a revolt by MPs if he offered the post a third time to his big brother, David". Here's the story in full.

The political “advice” to Ed Miliband to reshuffle the bruiser Ed Balls out of the shadow chancellorship is naked special pleading by the Tory camp and Labour’s Blairite rump. Balls repeatedly hurts the Conservatives. He predicted that austerity would create a double-dip recession and is smart at opposition guerrilla tactics, proposing that money saved on the Olympics should be siphoned off to cancel a petrol-tax rise. His biggest rave reviews are from David Cameron, who has abused Balls as a “muttering idiot” and “the most annoying person in modern politics”: backhanded compliments from Flashman.

Both Eds insist that there’s no deal to keep Balls in the Treasury brief, yet Miliband would face a revolt by MPs if he offered the post a third time to his big brother, David. Allies of the shadow chancellor whisper that he’d take his bat and balls away and retire to the back benches rather than swallow demotion to another portfolio.

Shadow chancellor Ed Balls speaks at the Labour conference in Manchester last year. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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Scotland's vast deficit remains an obstacle to independence

Though the country's financial position has improved, independence would still risk severe austerity. 

For the SNP, the annual Scottish public spending figures bring good and bad news. The good news, such as it is, is that Scotland's deficit fell by £1.3bn in 2016/17. The bad news is that it remains £13.3bn or 8.3 per cent of GDP – three times the UK figure of 2.4 per cent (£46.2bn) and vastly higher than the white paper's worst case scenario of £5.5bn. 

These figures, it's important to note, include Scotland's geographic share of North Sea oil and gas revenue. The "oil bonus" that the SNP once boasted of has withered since the collapse in commodity prices. Though revenue rose from £56m the previous year to £208m, this remains a fraction of the £8bn recorded in 2011/12. Total public sector revenue was £312 per person below the UK average, while expenditure was £1,437 higher. Though the SNP is playing down the figures as "a snapshot", the white paper unambiguously stated: "GERS [Government Expenditure and Revenue Scotland] is the authoritative publication on Scotland’s public finances". 

As before, Nicola Sturgeon has warned of the threat posed by Brexit to the Scottish economy. But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose dramatic austerity. 

Sturgeon is undoubtedly right to warn of the risks of Brexit (particularly of the "hard" variety). But for a large number of Scots, this is merely cause to avoid the added turmoil of independence. Though eventual EU membership would benefit Scotland, its UK trade is worth four times as much as that with Europe. 

Of course, for a true nationalist, economics is irrelevant. Independence is a good in itself and sovereignty always trumps prosperity (a point on which Scottish nationalists align with English Brexiteers). But if Scotland is to ever depart the UK, the SNP will need to win over pragmatists, too. In that quest, Scotland's deficit remains a vast obstacle. 

George Eaton is political editor of the New Statesman.