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Theresa May must get a grip on Tory infighting, or they'll turn to someone who can

Philip Hammond has few political friends, and his value to the cabinet's soft Brexiteers is limited.

Philip Hammond's so sexist he said that “even a woman” can drive a train these days – the Sun revealed on Saturday. Philip Hammond's so out-of-touch he said that public sector workers are “overpaid” – the Sunday Times revealed yesterday. Philip Hammond's so Europhile, he's trying to frustrate Brexit – the Telegraph reveals today. “Hammond accused of Brexit treachery” is their splash.

You don't have to be Hercule Poirot to work out that Telegraph story might have something to do with how the first two stories ended up in the press. Hammond himself blamed the leaks – he denied the train story and didn't-quite-deny the public sector pay story – on his Brexit stance on Marr yesterday. Allies of the Chancellor have gone further, telling the Sun's Matt Dathan that Michael Gove is to blame for the leaks.

The attacks on Hammond are based on a lot of things, and his scepticism as far as Brexit in general and the value of leaving the customs union in particular go are a key factor. But the anger, I'm told, at his remarks over pay transcended the Remain-Leave battlegrounds. (No fewer than five cabinet ministers confirmed the story to the Sunday Times.)

Hammond's political isolation is twofold. There is a caucus in the cabinet for holding the line on fiscal restraint, and there is a caucus in the cabinet for a softer Brexit. But there isn't a caucus for both, and Hammond's difficulty is he is loved by neither. (In a way, he's the last real Thatcherite left: into both fiscal discipline and the single market.)

There's also a sense among Remain-supporting ministers that before the election, Hammond was their air raid shelter, the only pro-European too big to be moved by Theresa May. Now, of course, everyone is too big to be moved by May so his value to the cabinet's soft Brexiteers is limited.

But the effect of the row may, surprisingly enough, be to rejuvenate the PM, at least for a little bit. Backbenchers aren't enjoying the public rows at all, and the hostile follow-ups – the Mirror splashes on Hammond's property empire with the headline “Hammond the Hypocrite” today – only add to their unease. There's a growing sense among the 2005 and 2010 intakes – who, don't forget, mostly won their seats from Labour and so are doubly uneasy about Jeremy Corbyn's ascent in the polls – that the cabinet's big beasts, holed up in Tory fortresses, are risking their seats for short-term advantage.

That's behind what might be the most significant Tory story in today's papers – the FT's George Parker reports that the 1922 committee have written to May saying that backbenchers will support her if she opts to sack feuding ministers and get things back under control. But there's a risk for the PM, too: if she can't get a grip on the infighting, backbenchers will turn to someone who can. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.

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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.