Why John O'Farrell is a smart choice for Labour in Eastleigh

In danger of being ignored as the coalition parties slug it out, the decision to select the author and broadcaster as its candidate means Labour will now enjoy significant media coverage.

Labour's decision to select John O'Farrell as its candidate in the Eastleigh by-election is being hailed by many commentators as a game-changer. It's worth noting, however, that while there is much affection in Westminster for the author and brodcaster (best known for his 1998 book Things Can Only Get Better: Eighteen Miserable Years in the Life of a Labour Supporter), it would be surprising if more than five per cent of voters in the constituency have heard of him.

This said, not only will O'Farrell's humour and warmth endear him to voters ("There is a great deal of hard work ahead. But first I am going to the pub", he tweeted last night), his decision to stand means that Labour, which was in danger of being ignored as the coalition parties slugged it out, will now receive far more local and national media coverage. With the polls as tight as they are (the first survey by Lord Ashcroft gave the Tories a three-point lead, the second by Survation gave the Lib Dems a three-point lead), a stronger-than-expected Labour performance could gift the seat to Conservative candidate Maria Hutchings. But having declared itself to be the party of "one nation" and having vowed to win over voters in the south, Labour has no choice but to campaign hard. Were it to finish in fourth place behind UKIP, as one poll suggested was possible, it would be a disastrous result for Ed Miliband.

Since this is a by-election, Labour has no incentive to tacitly advise its supporters to vote Lib Dem (as Ed Balls and Peter Hain did in 2010) but a slim Tory victory would be a reminder, as I noted last week, that tactical voting will be an issue at the next general election. The Conservatives are in second place in 38 of the Lib Dems' 57 seats and half of their 40 target seats are held by Clegg's party. If Labour wants to prevent the Tories decapitating scores of Lib Dems, it will need to think carefully about how it approaches these contests.

 

Author and broadcaster John O'Farrell was selected as Labour's candidate for the Eastleigh by-election last night.

George Eaton is political editor of the New Statesman.

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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.