Cameron could lose big as Balls makes mischief

The week before last, 81 Conservative MPs ignored the blandishments of the party whips, and the pleas of Prime Minister David Cameron, to demand a referendum on EU membership.

It was the biggest rebellion of Mr Cameron's six years as party leader, but with Labour also supporting the government, it was far from being the tightest parliamentary vote since the Coalition took power.

For that, you would have to go back to July, and the vote on whether the government should contribute an additional £9bn to the International Monetary Fund to help prop up other countries’ ailing, debt-ridden economies.

On that occasion, the Coalition's majority was reduced to just 28 votes, with 32 Tories joining Labour in the lobbies to oppose the bailout plan.

At the time, Chancellor George Osborne hoped that would be the end of it, and that the international debt crisis would be making no further claims on the generosity of British taxpayers.

But in the wake of the Eurozone crisis, and specifically the Greek bailout, it seems that yet more billions will be required after all.

Mr Cameron was at great pains to stress yesterday that increasing Britain’s contributions to the IMF does not mean UK taxpayers are propping up the Euro.

“Britain will not invest in the IMF so the IMF can invest in a Eurozone bailout fund. That is not going to happen,” he said.

But nevertheless, there is a certain amount of hair-splitting, if not to say outright disingenuousness, going on here.

The role of the IMF is after all to help countries in economic distress all round the world – and there seems no reason why that could not include countries in the Eurozone.

Shadow Chancellor Ed Balls has called on the government to make clear that “directly or indirectly this money will not end up supplanting the European Central Bank and putting liquidity support in for Spain and Italy. “

As the mischievous Mr Balls knows perfectly well, there are plenty of Tory backbenchers who privately suspect this is exactly what is going to happen to the additional IMF cash.

So why is this such a potentially difficult issue for Mr Cameron? Well, do the maths.

If there was a rebellion on the latest IMF handout, only this time on the scale of the EU referendum revolt, the government would not only lose – but lose big.

It is clear that Downing Street has already wised-up to this danger and is trying to argue that a second Commons vote would be unnecessary.

Asked about it yesterday, Mr Cameron said the July vote had "allowed for some extra headroom and what we would anticipate doing would be within that headroom.”

And there is, of course, another reason why the government is keen to avoid such a vote – namely that it would further highlight the divisions in the Coalition between his party and the Liberal Democrats.

The Coalition’s inherent instability derives from the fact that it is a marriage of convenience between two parties with wildly differing worldviews, and on no single issue is this more clearly exemplified than on that of Europe.

The Lib Dems, at some cost in terms of their own popularity, have consistently advocated the concepts of European integration and “ever closer union” for most of the past 30 years.

By contrast, the Tories have been drifting steadily in the opposite direction – to the point where Mr Cameron – our most Eurosceptic premier since we joined the EU – is seen by some on the right of his party as a creature of Brussels.

Going into this year, it seemed likely that electoral reform would be the rock on which this fragile Coalition ultimately foundered, but already that seems a very distant memory.

While the debacle that was the AV referendum in May has effectively buried that issue for a decade, the issue of Europe has risen phoenix-like from the flames.

Mr Cameron spent a good part of his leadership in the early years telling his MPs to stop ‘banging on’ about Europe, doubtless conscious of the fact that the issue had destroyed the last two Conservative governments.

Now that it is back on the agenda, I suspect they won’t stop banging on about it until it has broken this one too.

Victory strengthens Cameron's hand against rebellious party

Of all the many factors that determine political success and failure, there can be no doubt that luck features pretty high on the list.

David Cameron has always been a lucky politician. He had the good luck to be elected to the Tory leadership at just the point when people were starting to tire of New Labour, and the good luck to be battling for power against Gordon Brown rather than Tony Blair.

This week his luck held out again, just at the point when it looked as though it might be finally running out.

Amid continuing fallout from Liam Fox's resignation and a looming Tory backbench rebellion over Europe - remember those? - news came through of the death of Colonel Gadaffi - another enemy in whom Mr Cameron has been fortunate.

When Britain first entered the Libyan conflict on the side of the anti-Gadaffi rebels earlier this year, I have to confess that my first reaction was: "Oh, no, here we go again."

At best, I feared another misguided crusade to foist Western-style political values on an Islamic country with no tradition of democracy, and at worst, a lengthy civil war costing hundreds of British lives.

As it turned out, though, my fears proved groundless. Mr Cameron promised that Britain's role would be limited to aerial bombing rather than boots on the ground - and he was as good as his word.

He also repeatedly stressed the importance of Britain's national interest in the removal of Gadaffi, rather than making the case for Britain's involvement on moral interventionist grounds as Mr Blair might have done.

The involvement of the former Libyan regime in the shooting of WPC Yvonne Fletcher in 1984 and the Lockerbie bombing in 1988 was of course well-documented, even if only one person has ever been convicted of either crime.

What was less well-known until the start of this conflict, was Gadaffi's involvement in arming the IRA and thereby prolonging the bitter conflict that blighted these shores from the late 1960s to the mid-1990s.

In this respect, Mr Cameron was merely following in a much older tradition of British foreign policy - the one first established by Lord Palmerston in the middle of the 19th century.

"We have no eternal allies, and we have no perpetual enemies. Our interests are eternal and perpetual, and those interests it is our duty to follow." he said in 1848.

The danger for Mr Cameron, as the BBC's Nick Robinson has pointed out, is that having succeeded in Libya he develops something of a taste for military conflict.

In this context it is worth remembering that Mr Blair's first war was the successful intervention in Kosovo, not the later much more problematic entanglements in Afghanistan and Iraq.

Some credit, too, should go to Dr Fox who, whatever his other shortcomings, left the Ministry of Defence with a reputation more formidable by far than any of his short-lived Labour predecessors.

Having faced down Chancellor George Osborne over the spending review last autumn, securing proper ongoing funding for our armed forces may well prove his most important legacy.

Victory over Gadaffi does not, by any stretch of the imagination, remove Mr Cameron's wider problems within his own party.

His enemies on the right are not in the least pleased by the substitution in the Cabinet of the right-wing traditionalist Dr Fox for the socially-liberal Justine Greening, who came in as transport secretary in last Friday’s enforced reshuffle.

They are said to be even more incensed by the elevation of a Cameron 'favourite,' Chloe Smith, to a middle-ranking Treasury job, ahead of what they see as more talented, but also more right-wing, rivals.

And above all, they are up in arms over the imposition of a three-line whip against plans to hold a referendum on EU membership in 2013, due to be debated in the Commons next week.

With mounting concern over the implications of the Eurozone bailout, this last issue has the potential to be as toxic for Mr Cameron as it was in the 1990s for his predecessor-but-three, John Major.

Unless the three-line whip is modified, there may well be resignations in the government’s junior ranks.

But in his calm and authoritative handling of the Libyan conflict, Mr Cameron has once again demonstrated why he is vastly more popular than his party.

And so long as that remains the case, they won’t dare push him too far.

A tale of two reshuffles

A couple of months back, I wrote a column highlighting the absence this year of one of the hitherto regular features of the political scene – the summer Cabinet reshuffle.

Partly this could be attributed to David Cameron’s hatred of them. He had made clear he saw no purpose in shifting ministers around every 12 months, and wanted his team to stay in place for the duration of the five-year Parliament.

But while the Prime Minister should doubtless be applauded for such good intentions, politicians are always ultimately at the mercy of events.

And with the departure of Dr Liam Fox from the government yesterday afternoon after a week or more of damaging allegations about his links to unofficial adviser Adam Werrity, Mr Cameron has been forced to have a reshuffle after all – an Indian summer reshuffle, if you like.

Alastair Campbell famously said that if a story about a beleaguered minister ran for more than ten days it constituted a genuine crisis management situation rather than a mere media frenzy, and Dr Fox had already passed this point.

Whether or not he is found to have breached the ministerial code – Cabinet Secretary Gus O’Donnell has yet to reveal his findings – the former defence secretary’s behaviour has been extraordinary by any standards.

I would be the last person to condemn politicians for needing to let off steam occasionally, but most of our elected representatives manage to do that without adding a day onto an official overseas trip in order to stage a boozy party with their mates in Dubai.

But if that element of the story was somewhat comical, more serious was the suggestion that Dr Fox had created a parallel foreign policy operation, with the help of ‘advisers’ paid for by a shady bunch of right-wing ideologues.

Dr Fox owed his position in the Cabinet to having come a good third in the 2005 Tory leadership contest, and to his status as the unofficial leader of the ‘traditionalist’ Tory right.

It partially explains why, even allowing for his dislike of reshuffles, Mr Cameron appears to have fought unusually hard to retain the defence secretary, long after his departure had begun to assume a certain inevitability.

It is hard enough for Mr Cameron trying to hold together the coalition with the Liberal Democrats, while also trying to hold together the coalition of left and right, Europhiles and Eurosceptics, social liberals and traditionalists within his own party.

His appointment of transport secretary Philip Hammond as Dr Fox’s successor last night will have been calibrated not to upset that delicate balance, as well as keep the changes in government to a minimum.

In contrast to the Prime Minister, Labour leader Ed Miliband was so keen to have a reshuffle this year that he changed his party’s rules in order to do it.

The changes he announced last Friday by and large succeeded for the simple reason it did what Tony Blair’s reshuffles seldom did - and put round pegs in round holes.

So, for instance, former health secretary Andy Burnham, who had looked lost for ideas at education, moves back to cover his old brief, while the former schools minister Stephen Twigg, who returned to the Commons last year after losing his seat in 2005, takes on the education portfolio.

I am less optimistic about the much-hyped Chuka Umunna’s elevation to the role of Shadow Business Secretary up against Vince Cable, a man more than twice his age and with ten times his knowledge of the business world.

Nevertheless, focusing his changes on these three key policy areas makes good sense for Mr Miliband, as they are the areas where the opposition most needs to make political headway over the coming months.

The government may have won a narrow victory in the Lords this week over its controversial health reforms, but the issue remains a toxic one for the coalition and a potential election-loser for Mr Cameron.

For now, however, Labour will be content to have secured the unexpected scalp of a man who two weeks ago seemed secure in his role as one of the most senior ministers in the government.

How many more unwanted reshuffles will Mr Cameron be forced to perform before he comes to realise they are simply part of the territory.