Former Lib Dem minister Jeremy Brown speaks in New Delhi on February 16, 2012. Photograph: Getty Images.
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Jeremy Browne's manifesto would be electoral suicide for the Lib Dems

Policies such as cutting the top rate of tax, reducing NHS spending and introducing for-profit free schools are politically toxic. 

Jeremy Browne has long distinguished himself as the most ardent champion of the free market on the Lib Dem benches. But even by his standards, the manifesto outlined in his new book Race Plan (subtitled "An authentic plan to get Britain fit for 'The Global Race'") is strikingly radical. The former Home Office minister calls for the establishment of for-profit free schools and parent vouchers, for an end to the ring-fencing of the NHS budget and the possible introduction of patient charges, for a cut in the top rate of tax from 45p to 40p, for the creation of a new hub airport in the Thames Estuary ("Boris island") and for a reduction in the number of police forces in England and Wales from 43 to as few as 10. 

He tells the Telegraph's Benedict Brogan: "The government has allowed itself to default into timidity. I’m of the view that the most credible answer to the question 'How does Britain deal more confidently with global risk?' is unbridled, unambiguous, authentic liberalism." And, in a swipe at Nick Clegg, the man who sacked him last year, he adds: "We are telling the voters that we offer either diluted socialism or diluted conservatism. We are the diluting agent. The party shows resilience and fortitude, given the battering we have had. But we have defaulted, instead to trying to cause the least offence to the most people. We have sold ourselves as a brake in government, rather than an accelerator."

Browne's philosophical rigour might be admirable, but it's worth noting just how disastrous it would be for the Lib Dems to embrace his proposals. Far from wanting the top rate to be cut to 40p, most voters (68 per cent) support a 50p rate, while 48 per cent favour a 60p rate. As George Osborne learned to his cost, cutting taxes for the top 1 per cent a time of austerity is politically toxic. It's one reason why the normally mild Danny Alexander was moved to declare that the rate would be reduced to 40p "over my dead body". 

The Tories have, however, been smart enough to recognise that no government with an interest in self-preservation cuts the NHS (accurately described by Nigel Lawson as "the closest thing the English people have to a religion"). As a ComRes/ITV News poll found last year, health is the most popular spending area among voters. Just 5 per cent obelieve the NHS budget should be reduced and 71 per cent believe it should be increased - and with good reason. 

Owing to the above-average rate of health inflation (most notably the cost of new drugs and medical equipment), the NHS requires real-terms rises just to stand still. As a recent Social Market Foundation paper noted, "A ‘flat real’ settlement for the NHS is not what it sounds like since it is defined with reference to an irrelevant price index. To keep up with rising input costs, growing demand, and the public’s expectations for an adequate healthcare system, growth in spending on health has historically outstripped GDP growth." 

By historic standards, the NHS is undergoing austerity. Since 1950, health spending has grown at an average annual rate of 4 per cent, but over the current Spending Review it will rise by an average of just 0.5 per cent. As a result, in the words of the SMF, there has been "an effective cut of £16bn from the health budget in terms of what patients expect the NHS to deliver". Should the NHS receive flat real settlements for the three years from 2015-16, this cut will increase to £34bn or 23 per cent.

Browne's education proposals would be similarly toxic. A YouGov poll last year, for instance, found that 84 per cent of parents oppose for-profit free schools with just six per cent in favour. The marketisation of education would do even more to alienate the kind of Lib Dem voters who keep a voodoo doll of Michael Gove by their beds. 

Outside of the City of London, there is almost no appetite for the turbo Thatcherism advocated by Browne. As I’ve noted before, if Ed Miliband is a "socialist", so are most of the public. Around two-thirds of voters support a 50p tax rate, a mansion tax, stronger workers’ rights, a compulsory living wage and the renationalisation of the railways and the privatised utilities (putting them to the left of the Labour leader).

Browne might contend that only his vision can save Britain from inexorable decline, but he should not delude himself that he would ever win a mandate for it. 

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.