Rupert Murdoch listens to Barack Obama at the Wall Street Journal CEO Council annual meeting, at the Four Seasons Hotel, on November 19, 2013, in Washington, DC. Photograph: Getty Images.
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Rupert Murdoch predicts Labour victory in 2015

News Corp head says Cameron "will be dead meat" if the Tories fail to do a deal with UKIP.

With the polls narrowing in the wake of the Budget (YouGov puts Labour's lead at two points today), thoughts have turned to the possibility of a Conservative victory in 2015. But one man still predicting that Ed Miliband will make it to No. 10 is Rupert Murdoch. Earlier today, he tweeted:

The Conservative leadership has long rejected a national pact with UKIP (for the reasons I described here) but that leaves open the possibility of local deals between the two parties' candidates. Nigel Farage said last year that "a couple of dozen" Conservative MPs would be open to an agreement, an estimate described by Tory Philip Hollobone (who was endorsed by UKIP in 2010) as "spot on". 

At a fringe meeting with Farage at last year's Conservative conference, Bill Cash warned that UKIP could cost the Tories up to 60 seats and hand Miliband the keys to Downing Street. "Let us be realistic. Are we going to be allies or enemies? Lay off our marginals," he said.

While UKIP is unlikely to inflict as much damage on the Tories as Cash fears, the split in the right-wing vote (UKIP draws nearly half of its support from 2010 Conservatives), will make it easier for Labour to dislodge the Tories in the marginals it needs to win to become the largest party. At the last election, with a UKIP share of just 3 per cent, there were 20 constituencies in which the party's vote exceeded the Labour majority (one shouldn't make the error of assuming that all those who supported the party would have backed the Tories, but many would have done). Should UKIP poll around 8 per cent, it could well indirectly propel Labour to victory. Unless the Tories manage to dramatically reduce support for Farage's party between now and the general election campaign, talk of pacts will endure. 

But in the absence of a full deal, it looks this is one "winner" that Murdoch won't be backing. 

P.SOne interesting question is the extent to which Murdoch's prediction has been influenced by his recent conversations with Conservatives such as Michael Gove and Boris Johnson. It was during a recent meeting with the News Corp head that Gove reportedly said that George Osborne, not Boris, would be Cameron's strongest successor (a discussion seemingly premised on Conservative defeat in 2015). Murdoch, who has never warmed to Cameron (asked by Charlie Rose in 2006 "What do you think of David Cameron?", he replied: "Not much"), may well be indulging in some wishful thinking. 

George Eaton is political editor of the New Statesman.

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How will Theresa May meet her commitment to low-earners?

The Prime Minister will soon need to translate generalities into specifics. 

The curtailed Conservative leadership contest (which would not have finished yet) meant that Theresa May had little chance to define her agenda. But of the statements she has made since becoming prime minister, the most notable remains her commitment to lead a government "driven not by the interests of the privileged few, but by yours." 

When parliament returns on 5 September, and the autumn political season begins, May will need to translate this generality into specifics. The defining opportunity to do so will be the Autumn Statement. Originally intended by George Osborne to be a banal update of economic forecasts, this set-piece more often resembled a second Budget. Following the momentous Brexit vote, it certainly will under Philip Hammond. 

The first priority will be to demonstrate how the government will counter the threat of recession. Osborne's target of a budget surplus by 2020 has wisely been abandoned, granting the new Chancellor the freedom to invest more in infrastructure (though insiders make it clear not to expect a Keynesian splurge).

As well as stimulating growth, Hammond will need to reflect May's commitment to those "just managing" rather than the "privileged few". In her speech upon becoming prime minister, she vowed that "when it comes to taxes, we’ll prioritise not the wealthy, but you". A natural means of doing so would be to reduce VAT, which was increased to a record high of 20 per cent in 2010 and hits low-earners hardest. Others will look for the freeze on benefit increases to be lifted (with inflation forecast to rise to 3 per cent next year). May's team are keenly aware of the regressive effect of loose monetary policy (low interest rates and quantitative easing), which benefits wealthy asset-owners, and vow that those who lose out will be "compensated" elsewhere. 

A notable intervention has come from Andrew Tyrie, the Conservative chair of the Treasury select committee. He has called for the government to revive the publication of distributional analyses following Budgets and Autumn Statements, which was ended by George Osborne last year (having been introduced by the coalition in 2010). 

In a letter to Hammond, Tyrie wrote: "I would be grateful for an assurance that you will reinstate the distributional analysis of the effects of the budget and autumn statement measures on household incomes, recently and mistakenly discontinued by your predecessor." He added: "The new prime minister is committing her government to making Britain a country that works 'not for a privileged few, but for every one of us'. A high level of transparency about the effects of tax and welfare policy on households across the income distribution would seem to be a logical, perhaps essential starting point." 

Whether the government meets this demand will be an early test of how explicit it intends to be in reducing disparities. 

George Eaton is political editor of the New Statesman.