The plots thicken

14 October 2017

9:00 AM

14 October 2017

9:00 AM

‘Worst week ever’ is one of those phrases that journalists are, perhaps, too quick to use. Alastair Campbell once quipped that if you added up all Tony Blair’s worst weeks, you got a full year. The real worry for the Tories, however, is not that last week was Theresa May’s worst ever, but that it represented the new normal.

Even inside Downing Street, there are those who worry that leadership plotting and the like will continue until Mrs May leaves the building. They worry that while they are strong enough to repel the plotters — as they did so effectively this time — she isn’t powerful enough to take back control. So the whole cycle will continue, with the rebels coming back for another crack every time the Prime Minister looks vulnerable.

The optimists in her cabinet believe that if the Brexit talks have moved on to trade and transition by December, May will find it easier to assert herself domestically. But the problem is that her position is now the story. The government’s race audit, which No. 10 sees as a crucial part of its political project, was therefore quickly overtaken in the news by her refusal to say whether she would vote Leave if another referendum were held today. This refusal to answer was immediately examined for what it meant for her leadership: would it make ‘Vote Leave’ Tory MPs less inclined to support her? It also raises a more profound question: can the Prime Minister overseeing the most fundamental change in Britain’s affairs in 40 years be uncertain that it is in the national interest?

Those who wish to oust May don’t regard last week as the end of the matter. Rather, they think that time is on their side; that they will slowly creep up to the 48 names necessary. Their view is that with every compromise she makes on Brexit, her grip on that wing of the party weakens. They don’t need Eurosceptic MPs to abandon her wholesale. They just need two dozen to shift sides.

Mrs May survives faute de mieux. The Tory party can’t agree on who should succeed her and both factions fear that the alternative would be worse for them. Many Remainers still worry about Prime Minister Boris, who they not only think is temperamentally unsuited to the job but would be punished by Brussels with the worst possible Brexit deal. Indeed, some of the increased threat to May’s position is a result of the Foreign Secretary’s foes now being more confident that they could stop him reaching the final round of the contest. Most Leave-backing Tory MPs still fret that a new leader could choose to go down a different Brexit path. Then there are others who are simply concerned about what a leadership contest before Brexit could do to the party. Their fear is that it would lead to the bloodiest Tory battle yet over Europe.

In normal circumstances, the solution to this problem would be some form of unity ticket. A Remainer and a Leaver would team up to reassure both sides. Indeed, this is what Theresa May did when she ran for the job. She appointed a Leaver, Chris Grayling, as her campaign manager, and promised to put Brexiteers in charge of the process. This is why some Tory grandees still hope Amber Rudd and Michael Gove will unite, with her running to be Prime Minister and him handling Brexit. The cabinet divisions over Brexit, however, are now so deep as to render this almost unimaginable.

This might suggest that despite all those cabinet ministers saying that things can’t go on like this for another 18 months, they might well do so. But there are events that could change things. The first of these is the EU Council next week.

The EU knows that time is on its side. The two-year Article 50 clock strengthens its hand so it is happy to see it tick down. If ‘sufficient progress’ is not declared at this Council, it is a far bigger problem for Britain than the EU. Michel Barnier, the EU’s negotiator, might want to reach a deal, because that will advance his case to be the next Commission president. But it is also in his interests to show that he got as much out of Britain as he could have without collapsing the talks.

Even Donald Tusk, the Council president, has got in on this act, raising the prospect that there might not even be sufficient progress by the end of the year. The EU knows that many in the UK government fear that if this is the case, businesses will activate their contingency plans and significant numbers of jobs will leave Britain. They know that by raising this prospect, they will increase the pressure on Mrs May to make concessions to try and avoid it.

But perhaps the most pressing danger for the government is next month’s Budget. Even in Mrs May’s pre-election honeymoon period, Philip Hammond’s Budget unravelled as he was forced to drop plans to raise national insurance for the self-employed. One wonders how the Chancellor, who has something of a tin ear when it comes to politics, will navigate this far more challenging Budget.

Cabinet ministers are worried that Hammond will raise taxes. They believe that he is sufficiently worried about Brexit’s impact on the public finances not to want to borrow any more, but that there is no longer the political will in government to hold the line on spending.

If Hammond does raise taxes, it will be very unpopular on the Tory benches: the tax burden is already heading to a 30-year high. The bigger concern, though, is that the government doesn’t appear to have a post-Brexit economic policy. It is fundamentally unclear how Hammond thinks Britain should compensate for not being in the single market. There needs to be a vision for how Britain will make its way in the world after Brexit. A dynamic plan to make this country a more attractive place to research and invest would, ultimately, do more for tax revenues than whatever increases Hammond can get through this hung parliament.

If Mrs May is to take back control of the political agenda, it will be through boldness. She needs to show that her government has some big ideas and isn’t just minding the shop until Brexit is done. The alternative to this is more weeks like the last one.

James Forsyth and Iain Dale discuss May’s blunders on The Spectator Podcast.

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