Osborne's cuts will cost Britain in the long run

Through his narrow focus on making the books add up now, the Chancellor is piling up social costs for the future.

George Osborne today set out the grim departmental spending settlement for 2015-16: the year after the next general election and so, in some ways, no more than a starting point for whoever wins. Yet it is a critical baseline: whatever its political colour, if the government of the day wishes to deviate from these plans they will either need to set out how they will reallocate cuts between departments, or how they will replace these cuts by either increasing taxes or increasing borrowing. It is also likely, then, to mark a turning point in the framing of the political debate about austerity.

Unless there has been no or very little pick up in the economy by 2015, (in which case the economy is in much more serious trouble than many think) it looks increasingly likely that Labour will go into the general election with a 1997-style type pledge to match Conservative spending plans, at least on current spending. Even if that isn’t the position, all of the parties are signed up to medium-term fiscal consolidation. As the debate moves away from the here and now, and towards what happens after the next election, "too far, too fast" will become increasingly irrelevant.

This is why Miliband and Balls have shifted the debate away from the pace of deficit reduction towards starting to set out how Labour might seek to make savings. The debate is not so much about the size of the state but about how fiscal consolidation is to be achieved. There are some major flaws in the way Osborne is cutting and the centre-left should be highlighting these while still emphasising the need for medium-term cuts.

A smart corporate looking to take almost a fifth of its cost base out over an eight-year period would probably start with three principles. First, it would look right across its activities and investments to take a comparative view of what adds most value to its business, and would start by taking out the lowest-value expenditure. Second, it would take a long-term view spanning decades not months: ensuring cuts made today would not create higher costs over a ten or twenty year period. Last, it would have its best and smartest minds focused on the significant task at hand: it certainly wouldn’t be letting its top performers go, or distract its board and mid-level management with big restructures or expansion into new markets.

Osborne’s approach couldn’t be further from this sort of strategy. First, the government is not looking at what it does in the round, taking a comparative view of the value of its activities. Thus it is ring-fencing universal pensioner benefits, such as the Winter Fuel Allowance and free bus passes, some of which are paid to older people with an income far in excess of average earnings in retirement, while cutting working-age benefits and services for young people. Four out of five pounds of every welfare cut are hitting families in work, for example through cuts to childcare tax credits. Despite historically high levels of long-term youth unemployment, the Future Jobs Fund and the Education Maintenance Allowance have also been cut. The cumulative result of Osborne’s decisions, from his first emergency Budget up until today, is a big redistribution from the young to the old, further consolidating the intergenerational transfer that’s happened via the housing price bubble and shifts in pension provision away from defined benefit towards defined contriubution.

Second, Osborne is taking a short-term view, pursuing cuts that may make the books add up that year but which risk creating big long-term costs for the state. The short-sightedness of his decision to cut the Future Jobs Fund, proven to work in reducing youth unemployment, is a perfect example: the long-term costs of youth unemployment through the 'scarring' impact it has on a young person’s lifetime employment opportunities are well-established. But there are many others. Cutbacks to the early years services offered in children’s centres risk manifesting themselves in higher costs later on, for example through poorer school results and employment outcomes for the young children who no longer benefit from them. The government has forecast its increased tuition fees will save money based on some highly optimistic predictions about the rate at which graduates will pay back loans: the Higher Education Policy Institute have said the new system could actually end up costing more than the old system, despite a £9,000 a year price tag on most degrees. Some decisions will end up costing more in the even shorter term. The bedroom tax is forcing local authorities to move those who cannot afford it to more expensive bed and breakfast accommodation when there are no smaller homes available. Social care cuts simply shift the load over to the NHS as hospitals are forced to keep older people on wards longer than necessary because of a lack of community care, an even more expensive solution.

Osborne would claim that in the case of social care and children’s centres, it is local authorities choosing to make these cuts in light of their reduced settlement, not him. But if Whitehall were taking the long view it would be incentivising local government to think longer-term, for example by enacting a settlement that allows councils that do achieve long-term savings to keep a proportion to reinvest.

Last, the government certainly does not seem to be creating space for its brightest and best minds to focus on the challenge in hand without distraction. Cutting headcounts is an inevitable part of any austerity programme. But this has not been used as an opportunity to performance-manage out the poor performers. Instead, in many Whitehall departments, the best staff have taken voluntary redundancy packages and left. And the government’s misguided public service reform programme is absorbing huge amounts of energy at a time when morale is low. The NHS faces its tightest spending settlement since the Second World War: demographic pressures and social care cuts mean the ring-fence will feel very much like a cut. Yet health commissioners are focused not on the challenge at hand but on a massive structural reorganisation with no clear rationale as to why this will improve the quality of healthcare. In education, primary schools in several local authorities are being forced to become academies, getting grants of tens of thousands of pounds from central government to figure out how to recreate back-office and school improvement economies of scale. Ofsted has said this risks distracting school leaders from their core mission of improving standards at a time when cuts to children’s services are loading more onto schools.

The centre-left cannot make these sorts of critiques without saying more about how it would be cutting differently. Yet by setting out what he would do were he still Chancellor in 2015, Osborne is effectively forcing Labour onto this territory. Miliband and Balls made a good start a couple of weeks ago in making it clear universal pensioner benefits are no longer sacrosanct in light of what that means for support for young people and working families, and insetting out how a Labour government would seek to bring down the medium-term cost of social security by investing upfront in house building and encouraging businesses to pay the living wage. Eventually though, and before the next general election, Labour will need to say exactly how their plans would differ from Osborne’s; with the assumption that unless they set out more tax rises or accept higher levels of borrowing to pay for current spending, they will need to accept his cuts unless they are reapportioned elsewhere. This is what Ed Miliband signalled is to come in a recent speech: it will represent a marked shift in the tone of the political debate.

Sonia Sodha is a former policy adviser to Ed Miliband and writes in a personal capacity

George Osborne and Danny Alexander leave the Treasury for the House of Commons before the Spending Review. Photograph: Getty Images.

Sonia Sodha is head of policy and strategy at the Social Research Unit and a former senior policy adviser to Ed Miliband. She tweets @soniasodha.

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Cabinet audit: what do Theresa May’s new hires mean for government?

The New Statesman team looks at the politics and policy behind the new Prime Minister’s cabinet appointments.

Liam Fox, International Trade Secretary

Only Nixon, it is said, could have gone to China. Only a politician with the impeccable Commie-bashing credentials of the 37th President had the political capital necessary to strike a deal with the People’s Republic of China.

Theresa May’s great hope is that only Liam Fox, the newly-installed Secretary of State for International Trade, has the Euro-bashing credentials to break the news to the Brexiteers that a deal between a post-Leave United Kingdom and China might be somewhat harder to negotiate than Vote Leave suggested.

The biggest item on the agenda: striking a deal that allows Britain to stay in the single market. Elsewhere, Fox should use his political capital with the Conservative right to wait longer to sign deals than a Remainer would have to, to avoid the United Kingdom being caught in a series of bad deals.

Stephen Bush

Andrea Leadsom, Environment Secretary

A little over a week into Andrea Leadsom’s new role as Secretary of State for Environment, Food and Rural Affairs (Defra), senior industry figures had already begun questioning her credentials. A growing list of campaigners have called for her resignation, and even the Cabinet Office implied that her department's responsibilities will be downgraded.

So far, so bad.

The appointment would appear to be something of a consolation prize, coming just days after Leadsom pulled out of the Conservative leadership race and allowed Theresa May to enter No 10 unopposed.

Yet while Leadsom may have been able to twist the truth on her CV in the City, no amount of tampering will improve the agriculture-related side to her record: one barely exists. In fact, recent statements made on the subject have only added to her reputation for vacuous opinion: “It would make so much more sense if those with the big fields do the sheep, and those with the hill farms do the butterflies,” she told an audience assembled for a referendum debate. No matter the livelihoods of thousands of the UK’s hilltop sheep farmers, then? No need for butterflies outside of national parks?

Normally such a lack of experience is unsurprising. The department has gained a reputation as something of a ministerial backwater; a useful place to send problematic colleagues for some sobering time-out.

But these are not normal times.

As Brexit negotiations unfold, Defra will be central to establishing new, domestic policies for UK food and farming; sectors worth around £108bn to the economy and responsible for employing one in eight of the population.

In this context, Leadsom’s appointment seems, at best, a misguided attempt to make the architects of Brexit either live up to their promises or be seen to fail in the attempt.

At worst, May might actually think she is a good fit for the job. Leadsom’s one, water-tight credential – her commitment toopposing restraints on industry – certainly has its upsides for a Prime Minister in need of an alternative to the EU’s Common Agricultural Policy (CAP); a policy responsible for around 40 per cent the entire EU budget.

Why not leave such a daunting task in the hands of someone with an instinct for “abolishing” subsidies – thus freeing up money to spend elsewhere?

As with most things to do with the EU, CAP has some major cons and some equally compelling pros. Take the fact that 80 per cent of CAP aid is paid out to the richest 25 per cent of farmers (most of whom are either landed gentry or vast, industrialised, mega-farmers). But then offset this against the provision of vital lifelines for some of the UK’s most conscientious, local and insecure of food producers.

The NFU told the New Statesman that there are many issues in need of urgent attention; from an improved Basic Payment Scheme, to guarantees for agri-environment funding, and a commitment to the 25-year TB eradication strategy. But that they also hope, above all, “that Mrs Leadsom will champion British food and farming. Our industry has a great story to tell”.

The construction of a new domestic agricultural policy is a once-in-a-generation opportunity for Britain to truly decide where its priorities for food and environment lie, as well as to which kind of farmers (as well as which countries) it wants to delegate their delivery.

In the context of so much uncertainty and such great opportunity, Leadsom has a tough job ahead of her. And no amount of “speaking as a mother” will change that.

India Bourke

Chris Grayling, Transport Secretary

Having run Theresa May’s leadership campaign, Chris Grayling was always going to be in line for a pretty beefy promotion. And so it transpired, with the staunch Brexiteer being plucked from his post as Leader of the House of Commons to head the Department for Transport.

He has been a useful ally of May’s, reassuring fellow eurosceptics and Brexit voters that the once Remain-backing Prime Minister really means that “Brexit means Brexit”.

But his appointment will bring less comfort to DfT mandarins and those in the transport industry. Detractors who have previously worked for him in government usually either decry him as a hardline right winger, or suggest he is just simply not very bright. A notorious figure since his stint as Justice Secretary in 2012-15, Grayling is known for his uncompromising and compassionless (and often senseless) policy decisions – banning books being sent to prisoners, legal aid cuts, and controversial new court charges. The legal world was also riled by his lack of knowledge about the profession, as the first non-lawyer to serve as Lord Chancellor for nearly half a century.

However, Grayling is familiar with the transport brief, having shadowed the role in 2005-7, and he will have the same challenges as many past transport secretaries (and their shadows): the future of HS2, and the question of airport expansion. Politically sticky infrastructure projects that have been consistently kicked into the long grass. But perhaps May’s enthusiasm for a proper industrial policy – and shelving of austerity targets – will mean Grayling has to get more done on such matters than his prevaricating predecessors.

Anoosh Chakelian

Karen Bradley, Culture Secretary

The most politically charged of the culture minister's responsibilities is overseeing the BBC, and to anyone who works for - or simply loves - the national broadcaster, Karen Bradley has one big point in her favour. She is not John Whittingdale. Her predecessor as culture secretary was notorious for his belief that the BBC was a wasteful, over-mighty organisation which needed to be curbed. And he would have had ample opportunity to do this: the BBC's Charter is due for renewal next year, and the licence fee is only fixed until 2017. 

In her previous job at the Home Office, Karen Bradley gained a reputation as a calm, low-key minister. It now seems likely that the charter renewal will be accomplished with fewer frothing editorials about "BBC bias" and more attention to the challenges facing the organisation as viewing patterns fragment and increasing numbers of viewers move online.

Of the rest of the job, the tourism part just got easier: with the pound so weak, it will be easier to attract visitors to Britain from abroad. And as for press regulation, there is no word strong enough to describe how long the grass is into which it has been kicked.

Helen Lewis

Sajid Javid, Communities Secretary

Sajid Javid is a pinup for Tory aspiration – son of a British-Pakistani bus driver, he worked his way from his local comprehensive in Rochdale to the towers of New York.

At 20, he was attending the Conservative Party Conference and by 25 he was the youngest vice-president of Chase Manhattan Bank. This was the start of an international career that took him to London and Singapore.

After winning the seat of Bromsgrove in 2010, Javid began an equally rapid political rise. By the end of 2011, he was the parliamentary private secretary to the then-Chancellor, George Osborne.

The following years saw him climb the Treasury’s stairs. And a year’s break from economic policy found him haunting the foyers of London’s West End as Secretary of State for Culture, Media and Sport. But by 2015, he was back in Osborne’s sphere of influence as Secretary of State for Business, Innovation and Skills.

He is now the most high-profile survivor of Theresa May’s purge of the Osbornites (she and the former Chancellor often clashed in cabinet), but downgraded to the slightly less weighty position of Communities and Local Government Secretary.

Could Sajid Javid be Britain's first Asian Prime Minister? asked the Daily Mail in 2014. As it is, the new PM has sent his path to power on something of a detour. He's held onto a seat at the cabinet table, but with Osborne on the backbenches, he’s on his own.

Julia Rampen

Boris Johnson, Foreign Secretary

The world shared a stunned silence when news broke that Boris Johnson would be the new Foreign Secretary. Johnson, who once referred to black people as “piccaninnies” and more recently accused the half-Kenyan President of the United States of only commenting on the EU referendum because of bitterness about colonialism, will now be Britain’s representative on the world stage.

His colourful career immediately came back to haunt him when US journalists accused him of “outright lies” and reminded him of the time he likened Presidential candidate Hillary Clinton to a “sadistic nurse”. Johnson’s previous appearances on the international stage include a speech in Beijing where he maintained that ping pong was actually the Victorian game of “whiff whaff”.

But Johnson has always been more than a blond buffoon, and this appointment is a shrewd one by May. His popularity in the country at large, apparently helped by getting stuck on a zip line and havingnumerous affairs, made him an obvious threat to David Cameron’s premiership. His decision to defect to the Leave campaign was widely credited with bringing it success. He canned his leadership campaign after Michael Gove launched his own bid, but the question of whether his chutzpah would beat May’s experience and gravity is still unknown.

In giving BoJo the Foreign Office, then, May hands him the photo opportunities he craves. Meanwhile, the man with real power in international affairs will be David Davis, who as Brexit minister has the far more daunting task of renegotiating Britain’s trade deals.

Julia Rampen

Philip Hammond, Chancellor

Even officials with leftwing politics hoped that Theresa May would keep George Osborne in place at the Treasury, for two reasons: firstly because he is a considerate boss, and secondly because his exit from frontline politics likely means the end of a 19-year period of dominance by the Treasury, in which, whether under Gordon Brown, Osborne or even under Alistair Darling, whoever has been in office, the Treasury has been in power.

But Philip Hammond was very much the second choice, way ahead of any of the possible figures. Hammond was the biggest beast to back May’s candidacy and was rewarded for the Treasury brief that coalition denied him (he had shadowed the post of Chief Secretary to the Treasury in opposition but the mechanics of the coalition meant the post had to be given to a Liberal Democrat). Before May’s accession to the premiership, he had already lined up with her on negotiations with the European Union and Osborne’s deficit targets (now shelved).

Hammond comes in with the economy looking pre-recessional and with Britain’s future participation in the single market in some doubt. (Hammond has publicly said Britain ought to remain in the single market above all else – May is more concerned about immigration, while the Brexit-backing ministers are divided.)

What ought he to do? The big task is to get the construction industry back on its feet. Happily, although the decline in Britain’s credit rating has made borrowing more expensive, low interest rates at home and abroad make the case for fiscal stimulus stronger than ever, and mean the government can borrow on the cheap. Launching programmes of housebuilding, transport infrastructure and clean energy would be good ways to try to avert or at least ride out any economic shocks. (From an economic perspective albeit not an environmental one, it makes sense to approve new runways at Heathrow and Gatwick, two “shovel-ready” infrastructure projects that have private money behind them.)

But the big victory that Hammond could achieve at the Treasury would be to defeat the Brexiteer ultras and keep Britain in the single market.

Stephen Bush

Amber Rudd, Home Secretary

The good news first: Amber Rudd, MP for Hastings and Rye since 2010, joins May in the Great Offices of State. This is the first time two of these four positions have been held by women at the same time. Rudd is only the fifth woman ever to hold one.

The ex-Energy Secretary will take the reins directly from May, so it’s fair to assume she’ll carry on much of the work begun by the longest-serving Home Secretary since 1892. Rudd is unlikely to rock the boat here – she has not rebelled once in this parliamentary term. Therese Coffey MP told the Telegraph that May sees Rudd as “a safe pair of hands”.

The Investigatory Powers bill, or so-called Snoopers’ Charter, was a high priority for May, and is currently making its way through the Lords. Despite objections raised in the House around the protection of communications with journalists’ sources and lawyers’ clients, it’s likely it’ll pass without much fuss. Depending on the amendments that make it through, it may allow security services to hack into our computers and phones (including cameras and microphones), and require back doors to be built in encrypted messaging systems.

Rudd has repeatedly voted for a stricter asylum system by restricting the support available to failed asylum seekers, and denying permission for them to work if they’re in the UK for over six months. She was absent for a vote on sparing migrants from deportation on human rights grounds. May stubbornly sought to cut net migration in her time as Home Secretary, and created a minimum income threshold (£35,000) for non-EU citizens who have lived in the UK for less than ten years and who are hoping to stay.

Since taking the leadership May has confirmed that “we should have that goal of bringing immigration down to sustainable levels”. This is now down to Rudd, who in a fiery Brexit TV debate with Boris Johnson argued that immigration is “a complex problem…you need to look at the numbers. But the only number Boris is interested in is Number 10!”

Female Genital Mutilation within the UK also falls within the Home Office remit, and Rudd may try to make her own mark here. She is vice-chair of the Parliamentary Committee on Female Genital Mutilation and has called for stricter laws around the practice.

Barbara Speed

Justine Greening, Education Secretary

An early supporter of the new Prime Minister, and longstanding cabinet member, Justine Greening was always heading for promotion in a Theresa May cabinet. Her former territory, the Department for International Development, loyally picked up a lot of slack from the Home Office on migration issues under Greening's leadership, and she has regularly worked closely with May.

Personal allegiances aside, Greening is a sensible choice for the Department for Education. She is the first Education Secretary to have been educated at a comprehensive school, and as the first openly gay woman to serve in cabinet, she is a good choice for the Women and Equalities brief, which she also carries.

Theresa May’s first speech as Prime Minister highlighted two huge problems that many would attribute to the education system: how white working-class boys are “less likely than anybody else in Britain to go to university”; and how “If you’re at a state school, you’re less likely to reach the top professions than if you’re educated privately”.

Going some way to solving these two huge problems will be Greening’s aim, though really the issues go far deeper than her new department. Still, there is scope for improvement, beginning with an increased focus upon early years education: by the age of five, there is a 19-month gap in school readiness between the most and least disadvantaged children.

The UK is almost unique in having larger class sizes for primary than secondary school, which is barmy; addressing that should be part of a whole project of centring UK education policy on the first years in life, which are the most important, and ceasing the endless tinkering with secondary education.

Alas, many in the Conservative party do not want the tinkering to stop. There is a renewed call for the ban on opening new grammars to be overturned. There are 163 remaining today, concentrated in a few selective counties. The government’s approval of a new grammar school annexe in Sevenoaks last October, ten miles away from the original site, hints at many more to come, with ten council areas keen to open more satellite schools – effectively bringing grammar schools back through the back door.

The nostalgic argument to bring back grammar schools seems perverse considering that, in areas that maintain fully selective education like Kent, poorer pupils do worse than the national average and the attainment gap between the most advantaged and disadvantaged students is above the national average. It also ignores that the countries that perform best in education are those that separate latest, and demand the highest standards of all pupils until 16.

Greening will have more to grapple with than her predecessor Nicky Morgan, because the education brief has now been expanded to include higher education. Integrating the two could have some negative effects: schools and universities will now effectively be competing with each other for funding within the department. Whereas universities' former place in the Department for Business recognised how they are a British export and a driver of business.

But this integration gives Greening the opportunity to improve communication between elite universities and state schools, thereby improving access to the top universities. The coming vote on increasing tuition fees to £9,250 might give her an opportunity to demand that some universities ramp up their access work, as they did when fees when trebled in 2010. Yet she will soon realise that, while some universities could undoubtedly do more, the crux of the issue is way earlier, in the earliest years of life. This should be her main focus.

Tim Wigmore

Damian Green, Work and Pensions Secretary

"There will always be a little bit of the Home Office inside me,” Theresa May told her civil servants when she left 2 Marsham Street for the last time.

There is more than a little bit of the Home Office in her government, too, with trusted old hands from her old department now stretched out across the government. Damian Green, a long-term ally of May’s – and, like her, a veteran of the Conservatives’ internal battles to modernise from long before David Cameron arrived on the scene – and a trusted lieutenant in the Home Office, returns to government having been sacked by Cameron in 2014.

The appointment gives us a clue as to how May views the troubled Universal Credit programme and the Department for Work and Pensions overall. The DWP came to be regarded as something of a basket case on Whitehall and was at continual loggerheads – something that Stephen Crabb was brought in to fix after Iain Duncan Smith quit the government. Crabb’s resignation from the government following stories that he had sent salacious texts to a young woman stymied that project.

Step forward Green. It feels likely that his appointment is a signal that Downing Street is well aware of the problems with IDS’ failed reforms and the need for a competent hand to bring the department back into equilibrium. There’s an irony that the progressive wishlist for the DWP – unwind much of the Duncan Smith agenda, and get the department making headlines for positive reasons – is shared both by the Prime Minister and by the new boss at Caxton Street.

Stephen Bush

Priti Patel, International Development Secretary

Perhaps one of the least palatable new hires for Whitehall bods is Priti Patel, semi-promoted from cabinet-attending Employment Minister to International Development Secretary. The right winger is known for being on the neo-Thatcherite vanguard of the party characterised by the provocative 2012 treatise Britannia Unchained, which she co-authored – championing free market economics and a smaller state. So having her at the helm of any department would legitimately give civil servants the jitters.

But Dfid, though one of the less political departments, is a particularly controversial charge for Patel. In 2013, she suggested to the Daily Telegraph that it should be scrapped in favour of a more trade-focused department, calling for, “the consideration to replace Dfid with a Department for International Trade and Development in order to enable the UK to focus on enhancing trade with the developing world and seek out new investment opportunities in the global race. It is possible to bring more prosperity to the developing world and enable greater wealth transfers to be made from the UK by fostering greater trade and private sector investment opportunities.”

The International Development Act makes it illegal to tie aid to trade, so Patel will find it tough to pursue her ideological aims. But there are things she can do to change the tone and focus of the Department; her initial statement upon taking the job emphasises “working across government, with the Foreign and Commonwealth Office, the new Department for International Trade, the Home Office and others”. 

She could even advocate for repealing David Cameron’s commitment to spend 0.7 per cent of GDP on development, which was enshrined in law last year. Although it is unlikely she would try this, removing the ring fence on the Dfid budget might actually become a tempting prospect for the rest of government, which is set to become even more cash-strapped as a result of Brexit.

We can only hope that Dfid’s ability to keep its ministers out of the political fray, and regularly travelling overseas, will curb this threat.

Anoosh Chakelian

David Davis, Brexit Secretary

David Davis is proof that there are second acts in political lives. Eleven years after he was defeated by David Cameron in the Conservative leadership contest, and 19 years after he last served in government, Davis has been tasked by Theresa May with negotiating Brexit.

It was a role that the Leave supporter had pitched for throughout the EU referendum campaign, though he was still surprised by his elevation. When the call from Downing Street came, Davis was drinking with a former researcher in a Commons bar and initially ignored his phone. As Secretary of State for Exiting the European Union, he will now be one of the new administration’s defining figures.

The Haltemprice and Howden MP, 67, served as Europe minister from 1994-97, a role in which he acquired the sobriquet  “Monsieur Non”. He has already displayed similar implacability in his new post. To the charge that opening trade talks with other countries would be illegal under EU law, Davis replied: “Well that’s what they say, they can’t tell us who to talk to . . . What are they are going to do?” He has also warned that European migrants who arrive before Brexit is complete could be denied the right to remain.

Davis expects Article 50, which sets a two-year limit for withdrawal, to be triggered “before or by the start” of 2017. Rater than retaining single market membership (as Norway does), he favours Canadian-style tariff-free access. This would grant the UK exemption from free movement and EU budget contributions but would deny financial services the right to unhindered trade (known as “passporting”).

The former SAS reservist is best remembered by many for resigning as shadow home secretary in 2008 in order to fight a by-election over the issue of 42-day detention. After remaining outside Cameron’s team, he became a redoubtable defender of civil liberties from the backbenches. The council estate boy was also one of just two Tory MPs to originally vote against tax credit cuts (a record of rebellion that also includes tuition fees, capital gains tax, child benefit cuts, House of Lords reform, boundary changes and Syria).

When I interviewed him in May, Davis warned that any attempt to withdraw the UK from the European Convention on Human Rights would be defeated by himself and “a dozen” other Conservatives (a group known as the “Runnymede Tories” after the meadow where Magna Carta was sealed). It was a stance that May abandoned shortly after launching her leadership campaign.

Davis boasts the rare feat of joining the government while simultaneously suing it. In partnership with Labour’s deputy leader Tom Watson, he launched a European court action against the Home Office, May’s former department, over the bulk retention of communications data. “I would be surprised if the ECJ doesn’t find in my favour and that will have big implications for the IP [Investigatory Powers] bill,” he told me.

As one of the “three Brexiters” at the head of May’s government (the others being Boris Johnson and Liam Fox), Davis will compete not only for supremacy over policy. The trio have been ordered to share Chevening, the foreign secretary’s traditional country residence, in Kent.

George Eaton

Greg Clark, Business Secretary

A PhD in economics and a career in management consulting would suggest that the new Secretary of State for Business, Energy & Industrial Strategy has a flare for maths. Yet when it comes to policy, Greg Clark's record doesn't always add up. 

A renowned Tory moderniser, Clark's appointment to head the new department (born out of watering down BIS, and dismantling DECC) has been greeted with optimism from the business community and green sector alike. He “gets climate change”, said Ruth Davis from the E3G energy policy think tank.

As a former policy director, he helped found and champion David Cameron’s Big Society initiative. He has since been through a succession of frontbench roles, consistently voted in favour of gay marriage, helped devolve power to cities, and made a splash by arguing that Polly Toynbee, not Winston Churchill, should set the Conservative agenda.

Yet can this Middlesbrough-born son of a milkman succeed in growing a green economy where his Big Society agenda appears to have so markedly failed?

The greatest challenge his new, enlarged, and hopefully more empowered, department faces is to grow UK industry at the same time as urgently reducing our emissions. Luckily this is something that Clark also perceives to be one of the country's greatest opportunities. He has criticised those who challenge action on climate change, shown a readiness to plan for the worst when it comes to interpreting climate science, and provided an ambitious vision for Britain’s green economy: “Britain could be the Saudi Arabia of marine energy”, he said in 2009.

Yet while his words have promoted wave-power, his actions have tended to change like the tide. His reputation for devolving power to local governments was seriously dented last year, when it was announced that Clark – then the Communities & Local Government Secretary – not the local council, would get the final say over permission to frack in Lancashire. Other concerning examples of this “do as I say, not as I do” tendency include voting to lower taxes on fuel and for cuts to renewable subsidies. 

He must therefore work fast to ensure that his reputation for blue sky thinking is more than a lot of hot air. Barry Gardiner, Labour's shadow energy secretary, has suggested that accelerating energy efficiency, developing Carbon Capture Storage and bringing forward the government’s promised Carbon Plan, would all be good places to start.

The rise of Clark and his new department is likely to be linked to the demise of the Department for Energy and Climate Change – and the loss of climate change from a cabinet nameplate. Yet if he can steer new policy in the right direction, towards making environmental costs integral to industry rather than an afterthought, he might yet make this chequered inheritance his greatest strength.

India Bourke

James Brokenshire, Northern Ireland Secretary

Remember Northern Ireland? You could be forgiven for forgetting it – certainly, for most of the EU referendum campaign, the fate of the region, which receives £120m a year in funds from the European Union, and thanks to the free movement of labour and the Common Travel Agreement no longer has a hard border between the North and the South.

Now that is in jeopardy, and thanks to the landslide endorsement of Remain by the region’s voters, tensions between Northern Ireland and the mainland are understandably high.

Neglected during the campaign, Northern Ireland has been forgotten during the discussion of what Brexit means. Most of the attention over what Britain’s Leave vote means for its constituent kingdoms has focused on whether Scotland stays in the Union or not – little attention has been given to the £600m hit to the Welsh economy or to what Brexit could do to Northern Ireland’s peace process.

Step forward James Brokenshire. Just as during the Blair era, Gordon Brown brought his protégés up through the Treasury before diffusing them throughout the government machinery, Theresa May has handed jobs to Home Office juniors who she knows and respects.

Brokenshire’s brief will be to shield Northern Ireland from the consequences of the loss of EU funds and ensure that whatever post-Brexit deal is struck, a hard border between North and South remains off the agenda.

Stephen Bush