Morning Call: pick of the papers

The ten must-read comment pieces from this morning's papers.

1. Even Labour supporters don’t think that Ed Miliband’s up to it (Daily Telegraph)

The Labour leader is seen as out of his depth, and the Tories can sense a route towards general election victory in 2015, writes Fraser Nelson.

2. A Labour win is still on – if alienated Tories and Lib Dems play ball (Guardian)

Miliband has the prospect of becoming an unpopular leader, by fluke of greater conservative forces split three ways, says Polly Toynbee.

3. Merkel’s stealthy plan for the euro (Financial Times)

The German chancellor grasps that there is more to leadership than rhetoric, writes Philip Stephens.

4. Liberalism triumphs while Lib Dems sink (Times)

Nye Bevan, Roy Jenkins, Keith Joseph and Margaret Thatcher advanced liberalism more than Clegg’s party, says Philip Collins.

5. We’ve let a good financial crisis go to waste (Daily Telegraph)

The financial system remains unchanged – banks are still too big to be allowed to fail, writes Jeremy Warner.

6. Royal Mail sale is vandalism and must be stopped (Guardian)

Privatising Royal Mail will destroy a cherished institution, says Billy Hayes. Labour must commit to renationalise it.

7. So, should you have a flutter on the Royal Mail? (Daily Mail)

The government could be very disappointed if it expects a rush of retail investor interest, writes Alex Brummer. 

8. Nick Clegg can tell his party to hold their nerve (Guardian)

The Lib Dem leader never said it would be easy, but the economic crisis is being resolved, writes Menzies Campbell.

9. Meet Abdulrahim Elmi, a Somaliland Dickens hero who personifies his new nation (Independent)

Educated, successful young Somalis from the diaspora are flocking back to Somaliland to contribute, writes Peter Popham. Now the only thing the country lacks is international recognition.

10. I’m ending this scandal over children’s care (Daily Telegraph)

No longer will the quality, policies and location of care homes be kept a secret, says Michael Gove.

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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.