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Tory MPs fear the price of a deal with the DUP is too high

An increasing number in Theresa May's party believe she should form a minority administration.

A week after Theresa May promised to "work" with the DUP, no deal has been done. The horrific Grenfell Tower fire and the Northern Irish party’s desire to drive a hard bargain have stalled progress. Though no deal is better than a bad deal (to coin a phrase), the length of the negotiations has allowed Tory concerns to become entrenched.

Ever since May raised the prospect of an agreement with the DUP, Conservative MPs have had two fears: that a deal will further toxify their party’s brand (owing to the DUP’s stances on abortion and gay rights) and that it will make it impossible for the Tories to act as an impartial broker in the ongoing Northern Irish talks.

John Major, who rations his interventions carefully, amplified the latter this week when he warned that an agreement could put the “fragile” peace at risk.

Today’s Times/YouGov poll has heightened the Tories’ political concerns. It shows that only 8 per cent of the public have a “favourable” view of the DUP (48 per cent have an unfavourable one) and that only 27 per cent support a deal (48 per cent oppose one).

Conservative MPs, particularly those from the party’s One Nation wing, fear that a bad position among young and liberal voters will become worse. “It could wash away what’s left of Cameron’s legacy,” one told me.

May has belatedly called the DUP’s bluff by scheduling the Queen’s Speech for next Wednesday. Owing to progress made so far, the Tories are confident that the Northern Irish party will vote for their programme.

But this move has led some Conservatives to question whether a deal is required at all. Since the DUP’s ten MPs would never defy the government in a confidence vote (for fear of giving Jeremy Corbyn a route to power), some believe May should form a minority administration and seek support on a vote-by-vote basis. The costs, they say, far outweigh the benefits of an agreement: any deal is a bad deal.

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.