Cameron's EU referendum pledge leaves Labour in a difficult position

If Miliband matches Cameron's referendum offer, he will look weak. If he doesn't, he will look undemocratic. Which will he choose?

David Cameron's speech on the EU was driven not by policy but by politics. Six months ago, the Prime Minister had no intention of promising an in/out referendum on the EU but his recalcitrant backbenchers and an insurgent UKIP forced him into a dramatic reverse ferret. His address, then, was less about outlining a sophisticated vision for the future of the EU (one that Cameron's fantasy of an à la carte Europe, in which Britain picks and chooses which rules it obeys, does not represent) but simply about getting him through the 2015 general election. 

On that limited basis, the speech may prove to be a success. The early reaction from eurosceptic MPs, such as Douglas Carswell, suggests that it will help to unify a Conservative Party that has been badly divided over the EU since the election. 

The biggest long-term problem for Cameron remains that having promised a "fundamental change" in Britain’s relationship with the EU, he will struggle to persuade the eurosceptics in his party that it is in our interests to remain a member if he fails to deliver. The result would be the worst Tory split for decades as some cabinet ministers, such as Iain Duncan Smith and Owen Paterson, argued for an 'out' vote, while others argued for an 'in' vote. But that, if Cameron wins a majority at the general election (and it remains a very large 'if'), is not an issue he will have to face until long after 2015. 

For now, the Prime Minister enjoys the distinction of being the only party leader to have promised to give the electorate a vote over the EU at some point in the near future. This leaves Labour and the Liberal Democrats, both of whom have argued that Cameron's pledge is a rash one, in a difficult position. If they seek they match his offer at some point before 2015 (most likely in the form of a straight in/out vote, rather than one tied to renegotiation), they will look weak; following, not leading. If they do not, they will stand accused of denying the British people a say over an institution that has changed dramatically in the 38 years since the first and only EU referendum in 1975. Will Miliband and Clegg allow Cameron to be the only leader to stand up at the TV debates in 2015 and promise a referendum on the EU? Almost certainly not, which is why both must now work out how to climb down in the most graceful and painless way possible. 

George Eaton is political editor of the New Statesman.

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Why relations between Theresa May and Philip Hammond became tense so quickly

The political imperative of controlling immigration is clashing with the economic imperative of maintaining growth. 

There is no relationship in government more important than that between the prime minister and the chancellor. When Theresa May entered No.10, she chose Philip Hammond, a dependable technocrat and long-standing ally who she had known since Oxford University. 

But relations between the pair have proved far tenser than anticipated. On Wednesday, Hammond suggested that students could be excluded from the net migration target. "We are having conversations within government about the most appropriate way to record and address net migration," he told the Treasury select committee. The Chancellor, in common with many others, has long regarded the inclusion of students as an obstacle to growth. 

The following day Hammond was publicly rebuked by No.10. "Our position on who is included in the figures has not changed, and we are categorically not reviewing whether or not students are included," a spokesman said (as I reported in advance, May believes that the public would see this move as "a fix"). 

This is not the only clash in May's first 100 days. Hammond was aggrieved by the Prime Minister's criticisms of loose monetary policy (which forced No.10 to state that it "respects the independence of the Bank of England") and is resisting tougher controls on foreign takeovers. The Chancellor has also struck a more sceptical tone on the UK's economic prospects. "It is clear to me that the British people did not vote on June 23 to become poorer," he declared in his conference speech, a signal that national prosperity must come before control of immigration. 

May and Hammond's relationship was never going to match the remarkable bond between David Cameron and George Osborne. But should relations worsen it risks becoming closer to that beween Gordon Brown and Alistair Darling. Like Hammond, Darling entered the Treasury as a calm technocrat and an ally of the PM. But the extraordinary circumstances of the financial crisis transformed him into a far more assertive figure.

In times of turmoil, there is an inevitable clash between political and economic priorities. As prime minister, Brown resisted talk of cuts for fear of the electoral consequences. But as chancellor, Darling was more concerned with the bottom line (backing a rise in VAT). By analogy, May is focused on the political imperative of controlling immigration, while Hammond is focused on the economic imperative of maintaining growth. If their relationship is to endure far tougher times they will soon need to find a middle way. 

George Eaton is political editor of the New Statesman.