Budget shambles bodes ill for Tories' election prospects

It was of course New Labour, in the shape of former North Tyneside MP Stephen Byers' erstwhile spin doctor Jo Moore, who gave the phrase 'burying bad news' to the English language with her infamous email on the afternoon of 9/11.

But to be fair, it was neither her nor even her party which first invented the concept.  Her mistake was simply to be too brutally explicit about a practice that all modern governments have to a greater or lesser extent engaged in.

This current one is no exception, although its methods of news management at times lack the subtlety that, Ms Moore aside, was often the hallmark of New Labour’s.

This week it appeared to decide that the best such method would be to get as much bad news as possible out of the way before the Jubilee weekend, perhaps in the hope that four days of patriotic partying will mean it is all forgotten by Wednesday.

In this sense it reminded me of one of the standard news management techniques employed by governments of right and left throughout my time reporting on Westminster.

Each year, without fail, the last afternoon before the start of the summer recess would see hundreds of parliamentary answers covering all manner of embarrassing subjects dumped in the Press Gallery - just as most of us were preparing to toast the end of the political year over a few jars.

Then again, if you are going to be forced into the embarrassment of conducting no fewer than three U-turns over measures announced in the Budget, you may as well get them out there in the course of the same 48-hour period.

And if in so doing you can also manage to distract attention from the fact that your Culture Secretary sent James Murdoch a congratulatory message on the progress of his takeover bid for BSkyB on the day the said minister was given responsibility for deciding the outcome of it, then so much the better.

Cynical?  Well, it sort of goes with the territory.  But the point is, so is much of the general population when it comes to politics these days, leaving a question mark over whether such obvious news management techniques actually work any more.

Whether it was Chancellor George Osborne who was trying to take the heat off Culture Secretary Jeremy Hunt or perhaps even vice-versa, both men have ended the week looking somewhat diminished.

Mr Hunt’s position remains the most precarious of the two.  Although Prime Minister David Cameron continues to insist he has done nothing wrong, Labour is to force a Commons vote on whether he has breached the ministerial code.

He may survive that ordeal, but he surely cannot survive too many more embarrassing revelations about his links with the Murdoch Empire and his obvious cheerleading of the BskyB bid.

But while Mr Hunt’s recent travails have probably put an end to his hopes of one day succeeding Mr Cameron, Mr Osborne’s has undoubtedly been the greater fall from grace.

Okay, so his job is not under any immediate threat, but his reputation as the Tories’ strategic genius - even his opponent Ed Balls once called him the best politician in the Tory Party – is probably damaged beyond repair.

Did no-one tell him it was not such a great idea for a seriously wealthy, Old Etonian Chancellor to slap a tax increase on a product which, rightly or wrongly, is largely associated with the ‘working man?’

Did no-one tell him that cutting off a key source of funding to charities at a time when the Tories are trying to build a ‘Big Society’ was not exactly joined-up government?

For all the sound and fury surrounding phone hacking and the Leveson Inquiry, the Conservatives will not ultimately win or lose the next election over the question of whether Mr Cameron got too close to Mr Murdoch and his lieutenants.

They will win or lose it on Mr Osborne’s handling of the economy, and specifically on whether he has managed to tackle the deficit and get UK plc growing again.

With the current Parliament now approaching its half-way point, this year’s Budget needed to be a success, providing a springboard for the recovery the Tories hope will see them through to victory in 2015.

The fact that it has now turned into a shambles of the highest order does not augur well for the government’s prospects.

Clegg fires welcome warning shot over regional pay

When the history of David Cameron’s government comes to be written, the Budget delivered by Chancellor George Osborne on 21 March may well be seen as a decisive turning point in its fortunes

Whether it was the pasty tax, the granny tax, the tax on charitable giving or the abolition of the 50p rate, those looking for something to criticise in the Chancellor’s package found plenty of things to choose from.

But of all the measures announced by Mr Osborne two months ago, surely the most pernicious as far as the North-East is concerned was the proposal to introduce regional pay rates – paying teachers and other public sector staff in Newcastle less than people doing the same jobs in London.

Far from seeing the prosperity gap between richer and poorer regions as an evil which needs to be addressed, the idea of regional pay takes such inequality as an incontrovertible fact of life and then threatens to institutionalise it throughout the entire British economy.

Despite the efforts of some North-East MPs and union leaders, the proposal has received little national attention up until now, demonstrating once again the London-centricity of our national media.

But that may be about to change.  For the question of regional pay now appears to be playing into the much wider political narrative concerning the longer-term future of the Tory-Lib Dem Coalition.

In what can only be seen as a shot across Mr Osborne’s bows, Lib Dem leader Nick Clegg warned this week that his party could not sign up to a policy that would exacerbate the North-South divide.

It seems that regional pay has now joined the growing list of issues, alongside Europe, House of Lords reform and Rupert Murdoch, where the two parts of the Coalition are singing from increasingly varying hymn sheets.

Speaking to the National Education Trust in London Mr Clegg said: “Nothing has been decided and I feel very, very strongly as an MP in South Yorkshire, with a lot of people in public services, we are not going to be able simply willy-nilly to exacerbate a North-South divide.

“I think people should be reassured we are not going to rush headlong in imposing a system from above which if it was done in the way sometimes described would be totally unjust because it would penalise some of the people working in some of the most difficult areas.”

Perhaps the most heartening aspect of Monday’s speech was simply hearing a senior minister – the Deputy Prime Minister no less – talking about the North-South divide again.

It became practically a banned subject under Tony Blair, who first attempted to dismiss it as a "myth,” then tried to con the region into thinking something was being done about it by inventing a spurious target to narrow the gap between the three richest regions and the six poorest.

In one sense, Mr Clegg’s intervention is not unexpected given his own status as a South Yorkshire MP in what is a genuinely three-way marginal constituency.

Mr Blair’s former spin doctor Alastair Campbell has stated that Mr Clegg's only hope of retaining his Sheffield Hallam seat at the next election is to join the Conservative Party, and even making allowances for Alastair’s obvious partisanship, I’ve a sneaking suspicion he may be right,

But in the meantime, it is clearly in the Lib Dem leader's interests to try to put some clear yellow water between himself and the Tories on issues with a particular relevance to the Northern regions.

In view of the Lib Dems’ dismal performance in local elections in the North since the party joined the Coalition in 2010, it is surely not a moment too soon.

Mr Blair’s indifference to the whole issue of regional disparities was partly responsible for the Lib Dems’ dramatic surge in support in the region between 1999 and 2007, with Labour-held seats like Newcastle Central, Blaydon and Durham City briefly becoming realistic targets.

Meanwhile at local government level, the party took control of Newcastle from Labour, and actually managed to hang on to it for seven years before being swept away in the post-Coalition backwash of May 2011.

It will be a long way back for the party to reach those giddy heights again, still further if it is to mount a serious challenge for additional parliamentary seats in the region.

This week, however, Mr Clegg might just have taken the first step along the road.

A renewal of vows? Pull the other one

There is a school of thought that says that once a government gets itself into a position where it needs a relaunch, the brand is probably already so badly tarnished as to render the whole exercise pointless.

To be fair, the Coalition is probably not at that point yet. It is only two years into its existence, and governments of a far older vintage have come back strongly from similar periods of mid-term blues before now.

But the largely negative reaction to this week’s relaunch, with Wednesday’s Queen’s Speech at its centrepiece, does suggest that the government’s current difficulties go deeper than merely a run of bad headlines.

Coming in the wake of a disastrous Budget, a dismal set of local election results, and the continuing slow drip of damaging revelations from the Leveson Inquiry, it seems the Coalition is currently suffering from a bad case of the political Reverse Midas Touch.

Three major criticisms have been made of the legislative package announced by Her Majesty in what, for her, was surely the least eagerly-awaited public engagement of this her Diamond Jubilee year.

The first was that, with only 16 Bills, it was ‘too thin,’ but for my part, I wonder whether this was not in fact a point in its favour.

Over the past two decades, we have been subjected to an increasing deluge of legislation, for instance the 21 criminal justice bills spewed out by Tony Blair and Gordon Brown’s administrations over the course of 13 years.

A Conservative-led government, committed to reducing the burden of regulation and shrinking the size of the state, should perhaps have made more of a virtue of this year’s relative paucity.

The second most oft-heard criticism this week was that there was little or nothing in the programme specifically directed towards tackling the country’s current economic difficulties or producing a programme for growth.

But this, surely, is a category error.  Budgets, not Queen’s Speeches, are where you set out your economic policy, and Labour leader Ed Miliband should perhaps have known better than to make the main focus of his attack.

The third main criticism of the Speech – and the biggest one as far as most Tory backbenchers are concerned – was that it concentrated too much on Lib Dem hobby-horses such as House of Lords reform and not enough on issues that mat

Again, this depends on your point of view.  A second chamber elected by proportional representation from region-wide constituencies could well provide a stronger voice for regions such as the North-East – but I can well understand why the Tories, in particular, would not want that.

For me, the most fundamental flaw in Wednesday’s speech was not that it was too thin, too lacking in economic content or too Liberal Democrat, but that it lacked a unifying narrative which would give people a reason to support the government.

Say what you like about Mr Blair, his Queen’s Speeches never suffered from this deficiency, even if, as time went on, they tended to be more about protecting people from nightmares than giving them dreams of a better future.

Perhaps the reason it lacked a unifying theme because it was less the product of one man’s over-arching vision and more the product of compromise between the government’s two constituent parties.

In this respect, the most interesting political story of the week was not the Speech, but Prime Minister David Cameron’s interview with the Daily Mail in which he bemoaned his lack of freedom of action to do the things he really wanted.

What was especially notable about this is that, while Lib Dem leader Nick Clegg loudly and often complains about the Conservatives, Mr Cameron very rarely does the same about the Lib Dems.

Yet here was the Prime Minister saying:  “There is a growing list of things that I want to do but can’t…..there is a list of things that I am looking forward to doing if I can win an election and run a Conservative-only government.”

This week’s relaunch had been billed in advance by some cynics as the Coalition’s “renewal of vows,” but Mr Cameron’s interview shows this to be well wide of the mark.

In truth, it seems to be heading all the more rapidly for the divorce courts.

Johnson the real winner once again

You can look at yesterday's local election results purely in terms of the 400 or so council seats lost by the Conservatives and the 800-plus gained by Labour.

You can look at them in terms of national share of the vote, with Labour opening up a seven-point lead over the Tories that if repeated in a general election would put Ed Miliband comfortably in Number 10.

You can look at them in terms of the almost wholesale rejection of the government's plans for a network of powerfully elected mayors in our major cities, not least in Newcastle where the idea was rejected by a majority of almost 2-1.

But whichever way you choose to look at them, it's already pretty clear that Thursday was a very bad night for the Coalition.

It was always likely that the Tories would try to get us to look at the results through the prism of their star performer Boris Johnson's ultimately successful re-election campaign for the London Mayoralty.

But this really won't wash.  Johnson is a political one-off, and so, in a different sense, is his Labour opponent Ken Livingstone, who found himself deserted in this election by a significant element within his own party.

Although in the short-term Mr Johnson's narrow win provides the Conservatives with a convenient fig-leaf for their wider failure up and down the land, in the longer-term his victory is a disaster for David Cameron.

Once again, Boris has proved that he is the proven winner in the Tory ranks, in marked contrast to a leader who couldn't even score an outright election win against the exhausted volcano that was Gordon Brown in 2010.

In one sense yesterday's results were entirely predictable given the catalogue of disasters that the government has visited upon itself lately.

Mr Cameron will hope he can draw a line under it all in time-honoured fashion, with a relaunch of the Coalition - or as some are calling it, a renewal of vows – likely to come as early as the next fortnight.

This will be followed by a wide-ranging summer reshuffle that could see Ken Clarke and Andrew Lansley thanked for their service and replaced by younger, more media-savvy operators such as Grant Shapps and Chris Grayling.

But even this poses difficulties for Mr Cameron, with the long-planned promotion of Jeremy Hunt having to be put on hold pending his appearance at the Leveson Inquiry into press standards.

For my part, I wonder whether something deeper than mere mid-term blues is at work here - whether a public that was initially disposed to give the Coalition the benefit of the doubt has now started to do the opposite.

It is surely significant that, while 12 months ago the Tory vote held up as the Lib Dems bore the brunt of voters' anger over the austerity measures, this time round they were both punished equally.

Equally ominous for the Conservatives is the rise and rise of the UK Independence Party, which took 13pc of the national vote in a set of elections where it traditionally makes little impact.

If UKIP can start taking as many votes off the Conservatives in a general election, it might even one day force them to embrace the merits of proportional representation

Mr Miliband, though, will refuse to get carried away by any of this.

Six months ago I thought the public had by and large made up its mind about him, but maybe they are taking another look and liking what they see.

The biggest encouragement for the Labour leader is the fact that the party appears to be on the march beyond its traditional strongholds.

Not only is it winning back bellweather Midlands cities like Derby and Birmingham that will be crucial to its general election chances, but also more southerly councils such as Harlow, Plymouth and Great Yarmouth.

As for the North-East, having rejected regional government in 2004 it has now rejected the nearest thing to it, a Newcastle city region led by a powerful, Boris-style elected mayor.

While I am no great fan of presidential-style politics, it is hard to see how the region can compete effectively for its share of the national cake without such powerful advocates.

Fear of change, the desire to stick to the devil you know, remains a powerful factor in determining political outcomes, and Thursday’s mayoral referendum was no exception.

And if there is a crumb of comfort anywhere for Mr Cameron in yesterday’s results, it may well be in that.

The end of the beginning

Honeymoon period is doubtless an overworked term in politics – but all governments to some extent or other tend to enjoy a period of time in which the prevailing public attitude towards them is one of general goodwill.

Tony Blair was lucky enough that his lasted nearly five years, though that was in part down to the general uselessness of the Tory opposition of the time and the benign economic climate which he had inherited.

The public enthusiasm generated by the formation the Coalition government in 2010 was never quite on the scale of that which greeted Mr Blair’s arrival in 1997, and hence was never likely to last quite as long.

Nevertheless until relatively recently, the government was still widely seen as competent, and though its economic policies may have polarised opinion in some quarters, the press and public were still tending to give it the benefit of the doubt.

All that started to change with the Budget. The granny tax, the pasty tax and the row over tax relief on charitable giving combined to make this the biggest PR disaster to come out of the Treasury since Gordon Brown’s 75p pension increase.

There followed the woeful mishandling of the prospect of an Easter fuel strike, leading to what turned out to be a quite unnecessary spate of panic buying.

The government’s difficulties continued with the fiasco over the attempted deportation of Abu Qatada after the Jordanian terror suspect’s lawyers ran rings round Home Secretary Theresa May.

And by the end of last week, the run of mishaps had even acquired a name: omnishambles.

Things got no better at the start of this week as outspoken Tory backbencher Nadine Dorries tore into Prime Minister David Cameron and Chancellor George Osborne, branding them “arrogant posh boys who don’t know the price of milk.”

Then Jeremy Hunt, one of David Cameron's closest Cabinet allies and a potential future Tory leader, found himself accused of operating a ‘back channel’ of communication with the media mogul Rupert Murdoch during his bid for BskyB.

His special adviser took the rap and resigned, but this failed to quell opposition demands for Mr Hunt himself to fall on his sword.

It brought forth the wounding jibe from Labour’s Dennis Skinner: “When posh boys are in trouble, they sack the servants.”

But all of this really pales into insignificance besides the news that was delivered by the Office for National Statistics on Wednesday morning: that the government had, after all, led us into the dreaded double-dip recession.

Months of Labour warnings that the government was cutting too far, too fast were suddenly and dramatically vindicated.

It is too early to say whether it will prove to be a political game changer on the scale of, say the 1992 ERM debacle or Mr Brown’s election-that-never-was in 2007.

But it does, almost certainly, mean the end of a period in which the government’s claims about the economy have generally been given greater credibility than the opposition’s.

The politician whose personal fortunes have most closely mirrored those of the government over the past six weeks is Mr Osborne.

He has gone from being seen as the strategic genius of the Tory benches to being widely blamed for many of the government’s current difficulties.

The corresponding beneficiaries are Boris Johnson – Mr Osborne’s main rival for the future Tory leadership – and of course the Shadow Chancellor, Ed Balls.

As the former Labour special adviser Dan Hodges put it in the Daily Telegraph: “Ed Balls has won the right to be listened to now. That doesn’t mean people will automatically agree with what he says. But they will listen.”

In the light of the ONS figures though, perhaps the most damaging attack on the government last week came not from Mr Balls or even Mr Skinner, but from Ms Dorries.

The particularly lethal nature of her comments is that they play into a growing preconception about Messrs Cameron and Osborne that is being heightened by the worsening economic conditions.

A Prime Minster can get away with being a posh boy so long as he is competent on the one hand, and empathetic to the plight of those worse off than himself on the other.

On both of those scores, Mr Cameron is currently being found wanting.

Labour must share blame for region's plight

Over the past few weeks, the domestic political agenda has been dominated by the continuing fallout from what has by now surely become of the most controversial, even reviled Budgets of recent years.

It started within a few minutes of the Chancellor sitting down on 21 March with the revelation that he had performed a stealth tax raid on pensioners' incomes by freezing their personal allowances - the so-called 'granny tax.'

It continued with the belated realisation that, in pursuing the entirely laudable objective of limiting the amount of tax relief that can be claimed by the super-rich, the government had also made life much, much harder for the charitable sector.

And throughout it all there has been the ongoing row over the so-called pasty tax, coupled with increasingly laughable attempts by Old Etonian ministers to get with the workers by claiming to be fans of the hot snacks.

But until this week, no serious consideration had been given to the particular impact of George Osborne's proposals on the North-East.

So first off, congratulations are due to Gateshead MP Ian Mearns, always a doughty campaigner on behalf of the region, for securing a 90-minute debate on that very subject in Westminster Hall on Tuesday.

Having spent quite a lot of my career covering such debates, it would be easy for me to write them off as so much hot air, but that would be an overly-cynical view even for me.

They may not change anything, at least in the very short term, and the ministerial replies may be invariably formulaic. But where they do succeed is in raising consciousness of an issue to the point where it becomes harder to ignore, and that sense they are vital.

It was clear from the start that this was a Budget that was particularly pernicious in its potential impact on the region.

Quite apart from the impact on Tyneside-based pasty-maker Greggs, one of its central recommendations was the introduction of regional pay rates, which would institutionalise regional income disparities in the public sector for no better reason than the fact that they already exist in the private sector.

Mr Mearns chose not to dwell on that particularly in his opening speech to Tuesday's debate, however, choosing to highlight some damning statistics about the effect of Mr Osborne's higher-rate tax cut and the government's spending priorities.

He revealed that, while in London, the South-East and East Anglia, nearly 195,000 taxpayers will reap the benefit of the tax giveaway, in the North-East the figure will be fewer than 5,000.

On transport spending, the disparities are even more alarming. Mr Mearns revealed that more than 160 times as much is being spent on transport infrastructure projects in London than in the North-East.

"Once more, the people of the North East are paying the price for an economic strategy made in and for the wealthier south," he said.

He didn't, as it happens, mention the proposed HS2 high-speed link, but although it has its supporters, my own view is that it is not necessarily the panacea that some say it is.

For one thing, it won't arrive here until 2032 at the earliest. For another, any economic benefits to the wider North are likely to migrate towards Leeds and Manchester, which will be getting the link a good half decade earlier.

But the most fundamental question that has to be asked of any Labour politician when raising the issue of the North-South divide is why the party did not do more to address it during its 13 years in power from 1997.

Ian Mearns at least can point to a consistent track record on that score. As a leading figure in North-East local government during the Tony Blair years, he was one of those who regularly highlighted that administration's failure to address the issue, while the likes of Nick Brown and David Clelland also argued strenuously behind the scenes for a better deal for the region.

But the party as a whole allowed Mr Blair to get away with two particular claims that, taken together, served fatally to undermine the case for a more proactive regional policy.

The first was that the differences within regions were as great as the differences between them. The second was that any attempt to rebalance the economy risked harming the Southern regions which were the main driver for the economy as a whole.

Whatever the merit of these arguments, they became, over time, an excuse for simply doing nothing.

In the words of its response to a 2003 report on the issue: "The government does not accept the proposition that increased public funding to the less prosperous regions is a necessary condition to improve their prosperity."

The sad truth of the matter is that New Labour had an historic opportunity to do something about regional economic disparities at a time when it had a fair political wind behind it and, crucially, public spending as a whole was rising.

For the Coalition to try to tackle the gap in the current economic environment is a much harder task.

It's regional devolution, Jim, but not as we knew it

Writing last Saturday, the Newcastle Journal's regional affairs correspondent Adrian Pearson opened his column with the words: "If an elected mayor is the answer, what could possibly have been the question in North Tyneside?"

Well, allow me to have at least a stab at providing an answer.

There are plenty of cynical explanations. Elected mayors were originally the brainchild of the Tory cabinet minister Michael Heseltine in the early 1990s, and were seen by some at the time as an attempt to circumvent the power of high-spending, left-wing Labour councils.

Indeed, as Adrian pointed out in his column, this was precisely what later happened in North Tyneside, where Labour's stranglehold on local politics was finally thwarted by a succession of Conservative mayors in what became a recipe for decade-long infighting.

By the time New Labour came to enact Heseltine's proposed reforms, though, the agenda had changed somewhat. I believe Tony Blair's primary motivation for implementing elected mayors was simply to try to revive flagging voter interest in local government by, well, sexing it up.

In that sense, it was no more than a reflection of the trend towards ‘presidential’ politics that reached its apogee under Mr Blair, and which continues, though to a slightly lesser degree, under David Cameron.

The sorts of arguments that were heard then - "increased accountability through increased visibility" - are still used to promote the elected mayoral idea today - but a decade or more on, the debate has now become much more bound up with economic development and in particular with redressing regional economic disparities.

It is now very much part and parcel of the "city regions" concept that emerged from the wreckage of the regional government debate after the North East Assembly referendum debacle, with elected mayors seen as a way of giving their areas the kind of clout that properly-empowered assemblies might once have exercised.

This argument is already very much to the fore in the debate over whether there should be an elected mayor of Newcastle, for instance.

The city has yet to even make a decision on the issue - but already people such as Lewis Goodall of the regional policy think-tank IPPR North are talking openly about a directly-elected leader or 'metro mayor' not just for Newcastle but for the entire Tyneside conurbation.

"To really counterbalance the power of London, mayors need to have real powers to forge the destiny of their area," he wrote in Good Friday's Journal.

"Over time, this might mean a move towards a metro mayor for the wider city area - not just Newcastle but the surrounding conurbation too, with powers over economic development and transport."

To those of us with long memories, what is particularly interesting about that comment is that it was precisely those powers that the proponents of an elected regional assembly demanded - and failed to get - prior to the 2004 referendum.

I have always believed that had Mr Blair been more inclined to hand such powers to a regional body, the public might well have been more inclined to vote for it.

But regional government was only ever a means towards the greater end of tackling the North-South prosperity divide.

And as Lewis Goodall also pointed out in his piece, this is still very much with us, with the government planning to spend £2,700 per head on infrastructure projects in London compared to £5 a head in the North-East.

Looming over the whole debate over elected mayors is the larger-than-life figure of London Mayor Boris Johnson.

Not only has he enhanced the ‘accountability’ argument in favour of mayors by being a highly visible elected figurehead, he has also enhanced the economic argument by using his undoubted clout to further deepen that imbalance.

Mr Cameron’s own decision to axe regional development agency One NorthEast didn’t help matters either – but a gaggle of elected mayors flying the flag for the region could go some way towards filling that gap.

It isn’t regional devolution as we once knew it, Jim, but it might turn out to be the best form of regional devolution on offer.

Heir to Blair in more ways than one

Shortly after becoming leader of his party in 2005, David Cameron caused consternation among Conservative supporters by claiming that he was the true ‘heir to Blair.’

In one sense, it was a strange move, since the former Prime Minister had by then already begun the long, slow descent from the public adulation that greeted his arrival in No 10 to the public disillusionment that hastened his departure.

But Mr Cameron’s boast had a larger strategic purpose, namely to fix himself in the public mind as a politician of the centre ground and at the same time portray Mr Blair’s putative successor Gordon Brown as one who would abandon that territory.

And since entering Downing Street, he has continued in the same vein, claiming more than once that his health and education reforms are no more than a continuation of the changes initiated by Mr Blair a decade ago and thereby portraying Labour’s opposition to them as indicative as “lurch to the left.”

Mr Cameron has also found himself praised by former Blairite apologists such as John McTernan for his policy of liberal interventionism abroad, most notably in Libya.

But over the past week, much less welcome comparisons have started to be drawn between the two leaders as the government’s political fortunes took a marked turn for the worse.

At some points over the past seven days it has looked as though recent history may be repeating itself, such is the sense of déjà vu surrounding some of the government’s current crises.

Where New Labour has its 45p pension increase, the Coalition has its granny tax. Where New Labour had the fuel protests, the Coalition has the threat of a tanker drivers’ strike. And where New Labour was accused of selling honours for cash, Mr Cameron now finds himself accused of selling access.

No wonder that one of Mr Blair’s former speechwriters, Phil Collins, called it the government’s worst week in office so far, before going on to note wryly that under Mr Blair, each week was portrayed as being a worse one than the last.

Far more scathing was the verdict offered by the Conservative-leaning commentator
Peter Oborne, who saw this week’s events as signs of a shift in the political landscape.

“David Cameron’s claim that the government represents the interests of Britain as a whole now feels baseless and cynical, replaced by the growing perception that he represents nothing more than a coterie of rich and privileged men,” he wrote.

Oborne went onto to accuse Mr Cameron and Chancellor George Osborne of embracing “the worst aspects of Blairism: the obsession with very rich men; the divergence between public statements and private conduct; the preference for policy making through private cabal; and the almost demented Blairite contempt for their own party members."

This is only one example of what appears to be a deepening gulf between the government and its natural supporters, both in the press and in the country.

The Daily Telegraph was never that keen on him anyway, tending to regard him as “not really one of us” in much the same way as The Guardian once saw Mr Blair.

More worryingly for Mr Cameron, the Daily Mail now appears to have turned on him over the 'granny tax’ while The Sun has him in its sights over both the 'pasty tax' and the failure to do anything about fuel prices.

Some will say it's a good sign, showing that Mr Cameron is still occupying that fabled centre ground. Others will point out that alienating your natural allies is a political dead end, as Mr Blair eventually found to his cost.

Mr Cameron’s problems with the Tory press – and the wider party - really stem from one thing: his failure to win an outright parliamentary majority in 2010.

Had he succeeded in doing that, they would have forgiven him all his attempts to define himself in opposition to his own supporters, forgiven his portrayal of the Old Tories as a “nasty party” which he was determined to detoxify.

But he failed, even when up against an opponent whom they regarded as at best, ineffectual and, at worst, bonkers.

And until, like Mr Blair, he can prove himself a real winner, Mr Cameron will never truly capture his party’s heart.

Bad news management costs Osborne dear

There is a hoary old adage in British politics that a Budget that looks good on the day invariably looks like a turkey a few weeks later.

But there can be few Budgets in the recent past which have unravelled quite as quickly as George Osborne’s latest package unveiled to MPs on Wednesday.

Within an hour of him sitting down, #grannytax was the top trending item on Twitter and the revolt against the Chancellor’s ‘stealth tax’ raid on pensioners was under way.

Rarely have the following days’ newspapers seen such a degree of unanimity over a Budget statement – or made such depressing reading for the man from Number 11.

Part of the largely hostile press reaction can be put down down to poor presentation and rank bad news management on the part of the government.

As one Labour veteran reminded us, Gordon Brown’s modus operandi was to get all the bad news out there beforehand and hold the good stuff back for a big ‘rabbit-out-of-the-hat’ announcement on the day.

The government appears to have taken the opposite approach with this Budget, with more leaks than a St David’s Day parade as one heterographically-minded blogger put it.

Indeed one reason it has had such a bad press is that most of the more positive measures were old news by the time the Chancellor got to his feet.

There were at least some good points. Annual tax statements will be a welcome addition to the public’s right to know, while the 2p cut in corporation tax ought to help meet the desperate need for new jobs.

And the imposition of 7pc stamp duty on the purchase of homes over £2m is the nearest we are likely to come to the Lib Dems’ cherished “Mansion Tax.’

Furthermore, despite its appalling presentation, I don’t necessarily go along with all the criticisms that have been made of the so-called ‘granny tax.’

As the Institute of Fiscal Studies has pointed out, pensioners have so far done better than younger people from the government’s austerity measures, and this at least helps even things up a bit.

Inevitably, much of the ire of left-of-centre politicians and commentators has been directed at the 5p cut in the top rate of income tax, worth around £42,500 a year to someone earning £1m.

It provided Ed Miliband with the best joke of the week – and perhaps of his leadership – telling the Prime Minister he will save so much that he “will be able to afford his own horse.”

A more serious moral point was made by the commentator Martin Kettle, arguing that the top-rate tax cut highlights the different worlds inhabited by the super-rich and the rest of us.

“The vast majority of us would be prosecuted if we opted not to pay [tax.] If the rich don’t pay, the law is changed to reflect the fact that they won’t pay up,” he wrote.

The economic arguments over the efficacy of the 50p rate will doubtless run and run, but this is perhaps one area where the politics should have trumped the economics.

If the 50p rate symbolised the fact that ‘we’re all in it together,’ then the political damage to the government engendered by its removal may well outweigh any economic benefit in the longer term.

The move towards a single personal tax-free allowance of £10,000 has been widely welcomed, but - just as Mr Brown once did – Mr Osborne is recouping some of the cost through so-called ‘fiscal drag.’

It means around 300,000 middle-income earners are finding themselves dragged into the 40p tax rate at the same time as top-rate taxpayers see their own rates cut by 5p in the pound.

But saving the worst till last, for me the most pernicious of all the Budget measures – at least as far as the North-East region is concerned - is the proposed introduction of regional rates of pay in the public sector.

As has been pointed out, this will only serve to entrench existing regional economic inequalities and institutionalise low-wage economies in areas such as the North-East, Wales and South-West.

The government’s argument seems to be that as private sector pay is lower in these regions, so therefore public sector pay ought to be lower too.

To me, that sounds suspiciously like two wrongs make a right.

Nothing gets politicians so worked up as a Boundary Review

THIS week, The Journal reported that there had been more than 900 objections lodged with the Boundary Commission over its plan to alter the face of the region’s one real rock solid Tory enclave – the parliamentary seat of Hexham.

The plans, drawn up last September as part of the government’s proposal to reduce the size of the House of Commons by around 50 seats, would see historic country boundaries crossed in the name of ‘equalising’ the size of constituencies across the country.

If the proposals go ahead, the North-East will see its overall representation in Parliament fall from 29 to 26 with no part of the region unaffected by the changes.

For some of the region’s MPs, it is likely to mean the end of the political road, while those that survive are will find themselves standing for re-election in constituencies almost unrecognisable from their existing ones.

In nowhere than Hexham has the opposition to the government’s plans been more intense.

All three main parties – including the Conservatives and their sitting MP Guy Opperman – have come out against the proposals, with the 950 letters of opposition equalling the number received in all the other 28 North East constituencies put together.

What the opponents of the changes find particularly galling is the fact that the proposed new constituency will breach the historic county boundary between Northumberland and County Durham, with Haltwhistle moving into a newly-created seat of Consett and Barnard Castle.

Other proposed new constituencies in the region – for example Newcastle North and Cramlington – will see the traditional divide between metropolitan and non-metropolitan areas breached, although, perhaps surprisingly, these seem to have aroused much less opposition to date.

But the ongoing debate over Hexham could prove to be a microcosm of a much larger battle over the government’s proposals which could yet influence both the timing and the outcome of the next general election.

In my column last week, I speculated that Nick Clegg’s proposals for House of Lords reform could ultimately prove to the rock on which the Coalition founders, with Conservative peers, who want to maintain the second chamber’s built-in Tory majority, threatening to derail his plans.

What does that have to do with Parliamentary boundaries, I hear you ask? Well, potentially quite a lot.

For the Lib Dems are threatening to retaliate against the potential loss of their leader’s cherished Lords reform plans by scuppering the Tories’ attempts to reduce the number of MPs.

Now at first sight, you might think this was yet another ill-judged policy intervention by the Lib Dems that is likely to prove about as big a vote-winner for them as their support for the Euro.

Years of mounting public cynicism about politicians – capped by the MPs’ expenses scandal – have created a climate in which any party advocating a reduction in their numbers is likely to be on pretty firm electoral ground.

But politicians are never so exercised as when their own jobs are under threat – and for that reason alone, a Lib Dem revolt against the boundary review proposals could have a very real prospect of success.

A small number of Tory MPs affected by the changes – some of them only elected for the first time in 2010 and whose parliamentary careers face being cut off in their infancy – might even be persuaded to join such a rebellion.

This is not just about the Lib Dems getting their own back on the Tories, though. There is undoubtedly an element of calculation in the party’s stance.

It is estimated that the boundary changes will be worth an extra 20 seats for the Conservatives at the next election – some of which will undoubtedly come at the expense of their Coalition partners.

The changes will therefore make it much more likely that there will be a majority Conservative administration next time round, and correspondingly much less likely that the Lib Dems will again be in a position to hold the balance of power.

Killing off the boundary review might yet be the Lib Dems’ best hope of hanging onto their ministerial limousines. And it might even win them a few votes in Hexham.

The Coalition will not last five years

In last week's column, I suggested that the key strategic task facing the Liberal Democrats as they gather for their spring conference in Gateshead was to find a way of winning back the support that has deserted them since they joined the Coalition in 2010.

And doubtless there will be plenty of ideas floating back and forth at The Sage this weekend as to exactly how they should go about it.

They could, as some argue, stop the Health and Social Care Bill in its tracks. The Guardian commentator Polly Toynbee is among those warning this week that if they don’t take what may be their last opportunity to do this, it will seal their fate as a party.

Or they could, as Business Secretary Vince Cable has suggested, use their influence to help shape next month’s Budget, taking everyone earning less than £10,000 a year out of tax and introducing a ‘mansion tax’ for the super-rich.

Their leader, Nick Clegg, certainly wants to see the party getting on the front foot and proclaiming its successes in the Coalition rather than apologising for being part of it.

“Now it is time to move on. To stop justifying being in government and start advertising being in government. To stop lamenting what might have been and start celebrating what is. To stop defending our decisions and start shouting our achievements from the rooftops,” he said yesterday.

But whichever way they turn, will it make the slightest difference to the party’s electoral prospects?

Well, if history is any guide, no. The plain facts of the matter are that involvement in a Coalition is almost always disastrous for the smaller party, whatever political achievements it manages to extract from it.

The most recent example was the Lib-Lab pact in 1977/78. This was perhaps the most enlightened and humane period of government in my lifetime, but it still ended up doing the then Liberal Party terrible damage.

Far from emerging strengthened, their vote went down at the subsequent general election in 1979 and several of their most high-profile MPs, including the deputy leader John Pardoe, lost their seats.

Further back, the 'National Liberals' who joined the Tory-dominated National Government in the 1930s ended up simply becoming absorbed by the larger party.

And David Lloyd George’s 1916-22 Coalition, in which the Tories also held a numerical majority, likewise ended disastrously for the Liberals and their leader despite victory in the First World War.

It is partly for this reason that I have argued from the outset of the Coalition that, while the Lib Dems probably had no choice but to join it, they also needed to find a way of getting out of it alive – preferably well before the next election is due.

The Health and Social Care Bill, on which the Lib Dem rebels are more in tune with public opinion than the government is, would have given them a plausible pretext, although the party activists’ last-ditch bid to halt the Bill now looks unlikely to succeed.

Europe, by contrast, would not be a good reason for the Lib Dems to try to collapse the Coalition, for the simple reason that on this issue, it is the Tories who are much closer to the mainstream public view.

One less widely-canvassed possibility is House of Lords reform – not the sexiest of issues, for sure, but one on which the Tory ‘backwoodsmen’ seem almost certain to thwart Mr Clegg’s well-meaning attempts to drag the British Constitution into the 21st century.

The last time I discussed the possibility of the Coalition ending before its due-date of 2015, a commenter on my blog reminded me that the government has already passed legislation to bring in five-year fixed-term Parliaments.

My view, however, is that this could turn out to be no more than a quaint constitutional notion, given that the legislation also allows for a two-thirds majority of MPs to dissolve Parliament ahead of its term.

Let’s just suppose that David Cameron decides he wants an election. Would Labour MPs, in such circumstances, really vote to keep him in office until 2015?

It stands to reason that the Coalition will not last five years. It will, rather, last just as long as both of its partners want it to.

The real issue which the Lib Dem spring conference needs to address

Back in the bad old days of two-party politics, the Liberal Democrat spring conference was one of those recurring events in the political calendar which even political journalists struggled to get too worked up about.

Sure, the BBC invariably ran a short item about it – but that was only because its rules on impartiality oblige it to give Lib Dem gatherings the same coverage as those of the other two main parties.

How times have changed, however. Not only is this year’s spring conference in Gateshead a big story in the North-East, but it is also set to attract the kind of national media attention which the third party could once only dream of.

At stake could be the future of a flagship piece of government legislation – and in the longer-term, the future of the government itself.

Last year’s spring conference saw Lib Dem activists effectively force their Tory coalition partners to order a ‘pause’ in the controversial Health and Social Care Bill designed to hand large parts of the NHS over to GP consortia and increase competition across the service.

A year on, and this year’s may yet result in the hated Bill’s final demise.

Alongside Europe, the Bill remains perhaps the biggest point of division between the two Coalition partners, despite continuing attempts by both party leaderships to soften it at the edges in the hope of avoiding a showdown.

But even a desperate entreaty by party leader Nick Clegg and much-loved veteran Baroness Williams this week looks unlikely to head-off an attempt at next week’s gathering to kill of the legislation once and for all.

Unlike on Europe, it has been clear for some time that the Lib Dem tail is wagging the Tory dog when it comes to the NHS.

Earlier this week, Lib Dem peers put forward a fresh series of amendments to the Bill in the House of Lords designed to further water down the requirements for increased competition.

Initially, the government said it was ‘not minded’ to accept the amendments, but once they were duly passed, it decided not to try to overturn them.

At the same time, Mr Clegg and Lady Williams issued a letter to party members saying that the Bill as now amended contained all the necessary safeguards and should therefore now be “allowed to proceed.”

Early signs are, however, that activists are determined to press ahead with a conference vote on the motion, which calls for the "deeply flawed" Bill to be "withdrawn or defeated.”

One prominent Lib Dem, Graham Winyard, has already resigned from the party over the issue, warning Mr Clegg that his support for the bill would be "a slow-motion disaster" for the NHS and the party.

Labour has not been slow to seize on the divisions, with shadow health secretary Andy Burnham attacking Mr Clegg’s “stage managed posturing” over the Bill.

He urged Lib Dem rebels to work with Labour and dismantle the Bill to remove the provisions relating to competition.

But of course the Lib Dems’ problems go much wider than health. Their real difficulty lies in the fact that voters have deserted the party in droves since it joined the Coalition.

In this sense, it is ironic that they are meeting in the North-East at a time when the party’s standing in the region has possibly never been lower.

A poll carried out by YouGov the week before last showed the party now has the support of just 4pc of the region’s voters – lower than the UK Independence Party on 7pc.

The days when the Lib Dems entertained serious hopes of winning parliamentary seats such as Blaydon and Durham City now seem a very long way away indeed.

Under Charles Kennedy’s leadership from 1999-2006, the party pursued a successful strategy of appealing to disaffected Labour voters as well as its own traditional supporters, gaining its higher number of MPs since the 1920s.

It is now facing the nightmare scenario of its parliamentary representation being reduced to single figures for the first time since the revival of third-party politics began in the 1970s.

It is hard to dispute the analysis of Gateshead councillor Ron Beadle that, in electoral terms, the Coalition has been a “disaster” for the party.

This, not the future of the health bill, is the real issue which this spring conference needs to address.

What next for David Miliband?

It was Clement Attlee who famously told a Labour colleague that a period of silence from him would now be welcome, thereby inadvertently earning himself an entry in the Oxford Dictionary of Modern Quotations.

And it is certainly true that there are times in politics when it is best to keep your head down and your mouth shut.

By and large, the past 15 months have been such a period for David Miliband, the South Shields MP and former Foreign Secretary who, until October 2010, had been widely expected to become leader of his party.

But it wasn't to be and, rather than risk the sort of comparisons that might have undermined his younger brother's leadership, the elder Miliband stood bank from the political frontline and confined his public statements to the occasional supportive message.

Such was ostensibly the nature of his article in the New Statesman a couple of weeks back in which he outlined a seven-point plan for the future of the party and called for “restless thinking” in its bid to recapture power.

He made a point of praising his brother Ed on no fewer than four occasions, highlighting his success in maintaining party unity, and having spoken out "powerfully" over issues such as welfare cutbacks.

But that, of course, did not stop the political commentariat once more portraying David’s intervention as a covert leadership bid.

The resulting furore saw Mr Miliband forced into another round of interviews in which he appeared to rule out any return to the frontbench on the grounds that it would merely perpetuate the “soap opera.”

One rather venomous interpretation of his actions came from the Telegraph columnist Matthew Norman in an article headlined: ‘The sniping and self-pity of a truly feeble man.’

Likening Mr Miliband’s political modus operandi to the game of Knock Down Ginger, he accused him of thrice raising the standard of internal revolt before “scuttling away to hide in the bushes.”

“The pattern was set in the summer of 2008, when David wrote a barely coded article in the Guardian lacerating Gordon Brown. The moment it was greeted as the challenge to the PM’s authority that it certainly was, off he scarpered, denying any such intent,” he wrote.

“Within a year, his close friend and Cabinet ally James Purnell resigned, laying the ground for David to oust Mr Brown by doing the same. Again he bottled it, and stayed."

Mr Norman saw the New Statesman article, and the semi-retreat that followed it, as more of the same, going on to suggest a permanent silence from a man he charmingly described as “a mincing paean to metrosexual narcissism.”

It was left to the former Labour North official and Blairite blogger Hopi Sen to leap to Mr Miliband’s defence, pointedly describing Mr Norman as a “food writer” alongside various other less polite terms.

But beneath all this knockabout lies a serious point - namely what is to become of a politician who still has much to say about the future direction of his party – but who is unable to say it without his actions being either over- or mis-interpreted?

As one of those ubiquitous ‘friends’ put it: “This is someone who has spent a lot of time thinking about the future of the Labour Party. The way the cookie has crumbled, the only way he can do that is through argument and debate.”

Perhaps the real purpose of David’s New Statesman article was to find out whether he can actually now start to contribute to that debate without others seeing it as an attempt to further destabilise his brother’s somewhat faltering leadership.

If that was indeed his intention, the answer seems to be a resounding no.

Sadly, the likely upshot of this is that Mr Miliband may well come to feel that the only way to end the soap opera will be for him to remove himself from the political arena entirely, and leave Parliament at the next general election.

And given his stature in both the country and the region, I, for one, would consider that a shame.

Milburn machinations show governnment's desperation

Back in 2003, I went along to a Downing Street press briefing along with the rest of the Westminster media corps expecting to be given details of Tony Blair's latest Cabinet reshuffle.

We emerged 20 minutes later with the very surprising news that the health secretary, Alan Milburn, had resigned from the government, saying he wanted to spend more time up North with his young family.

The sudden departure from government of the then Darlington MP, who until then had been widely tipped as a future candidate for the party leadership, was possibly the most unexpected resignation of the Blair years.

But for shock value, it would have paled into insignificance if this week's rumours about a Cabinet comeback for Mr Milburn - in the very same job he abruptly left nine years ago - had actually come to pass.

The story went that a newly-ennobled Lord Milburn would be brought back by David Cameron to push through the health reforms that Gordon Brown succeeded in blocking nine years ago.

The Prime Minister would then be able to claim - as he already has with Michael Gove's education reforms - that he is merely carrying on the work that Mr Blair and New Labour began, thereby strengthening his claim to the political centre ground.

It seems likely from what has emerged this week that this bizarre proposal was at least discussed at some level in Number Ten, even if those discussions didn’t actually get as far as Mr Milburn himself.

But the fact that such a conversation could even take place at all is an indication of the mess that the Coalition has got itself into over its own attempts to reform the NHS - and in particular the position of the current health secretary, Andrew Lansley.

Government colleagues of Mr Lansley were pulling few punches this week as his flagship Health and Social Care bill suffered another mauling in the House of Lords.

“Andrew Lansley should be taken out and shot. He’s messed up both the communication and the substance of the policy,” a Downing Street source was quoted as saying.

Of course, had Mr Cameron wanted to get rid of him, he had a perfect opportunity to do so last week with the mini-reshuffle sparked by the enforced resignation of the energy secretary Chris Huhne.

But as I have noted before, the Prime Minister hates reshuffles, having apparently been warned against them by former Cabinet secretary Gus O’Donnell, and for now, Mr Lansley retains his “full confidence.”

To those of us who have been following the progress of the government’s attempts to introduce greater competition into the NHS - and hand over the running of it to reluctant GPs - none of this should have come as any great surprise.

Mr Cameron has been warned on several occasions that the reforms, which are opposed by just about every leading professional body within the service, risked becoming his Poll Tax.

His apparent obduracy over the issue is all the more surprising in the light of his determined efforts before the last election to “detoxify” the Tory brand when it came to the NHS.

As the Conservative Home website pointed out yesterday; “David Cameron’s greatest political achievement as Leader of the Opposition was to neutralise health as an issue. The greatest mistake of his time as Prime Minister has been to put it back at the centre of political debate.”

Plans are now being laid for a debate at the Liberal Democrat spring conference which is expected to result in fresh calls for the bill to be scrapped, if it hasn’t been already by then.

And Labour’s shadow health secretary Andy Burnham has shrewdly called for cross-party talks on a compromise deal which could see the non-contentious parts of the bill covering public health, social care and GP commissioning kept, while scrapping the bits relating to extending the private sector.

It is understood that this option is now being seriously canvassed within the government, but if adopted it would of course represent a complete humiliation for the health secretary.

When Mr Milburn walked out of the health department, Westminster was genuinely stunned. The greater surprise this time round would be if Mr Lansley stays put.

Advantage Tory right as Huhne exits stage left

So farewell then, Chris Huhne – well for the time being at any rate, as the erstwhile Energy Secretary quits in order to fight charges of perverting the course of justice in relation to a driving offence committed in 2003.

The leading Liberal Democrat politician was left with no choice but to resign from the Cabinet yesterday after effectively being charged with lying to the police over whether he or his ex-wife was driving at the time of the incident.

Mr Huhne, who continues to deny the charges, will now have to clear his name if he is to stand any chance of resuming what has been an eventful career over the course of less than seven years as an MP.

For now, though, his Lib Dem colleagues will have to manage without his combative presence around the Cabinet table as the curse that has seemed to bedevil the party’s senior figures since the last election strikes again.

They lost their cleverest minister, David Laws, within 16 days of the Coalition taking office, and nearly lost their most well-known, Vince Cable, over his ill-judged pledge to destroy the Murdoch empire – uttered before it succeeded in destroying itself.

Now they have lost their most abrasive in Mr Huhne, the stoutest defender of the party’s interests within the government and, by some distance, the Tory backbenches’ least-favourite Liberal Democrat.

Few Tory tears will be shed at his departure. Right-wing internet bloggers who have had Mr Huhne in their sights for some time were literally cracking open the champagne yesterday morning – and one even posted a video of himself doing so.

The evident Tory glee demonstrates the fact that Mr Huhne’s enforced resignation is likely significantly to alter the balance of power within the Cabinet in their favour.

His successor Ed Davey is a capable minister who deserves his Cabinet promotion - but he is no Chris Huhne, described by one commentator yesterday as a “political bulldozer who would try relentlessly to get his way, and who was not averse to media shenanigans to advance his cause.”

It was Mr Huhne, rather than Nick Clegg, who led the attack on the Tories over their handling of the referendum on the voting system last May, when Mr Cameron gave the green light for a series of bitter personal attacks against the Lib Dem leader.

And it was he who articulated the Lib Dem rage over Mr Cameron’s decision to veto a new EU treaty at the Brussels summit in December.

What gave Mr Huhne a particular degree of authority within the Cabinet was his strong power base within the party as a two-time leadership contender and de facto leader of the party’s social democratic tendency.

He could very well have become his party’s leader instead of Mr Clegg, had not a pre-Christmas postal strike in 2007 led to thousands of votes in his party’s leadership election arriving after the ballot boxes had closed.

Until yesterday, he would have been the likeliest replacement for Mr Clegg were the latter to have been forced out by party activists still grumbling over his decision to join the Coalition.

Westmorland and Lonsdale MP Tim Farron, the party’s distinctly Coalition-sceptic president, now looks odds-on for that role, possibly as soon as 2015 in the event of Mr Clegg’s three-way marginal Sheffield Hallam seat turning either red or blue next time round.

The short-term impact, then, of Mr Huhne’s departure is that it will embolden the Tory right and make this look even more obviously a Conservative-led government than it already is.

This in turn will be good news for Labour and Ed Miliband, whose essential line of attack on the Coalition is that it is a Tory government in all but name, and who this week restored some of his party’s sagging morale by putting Mr Cameron on the back foot over bankers’ bonuses.

The real nightmare scenario for the government, though, would come if Mr Huhne were to go to jail – forcing a by-election in his highly marginal seat of Eastleigh which would pitch the Lib Dems and the Tories against eachother.

And the potential consequences of that for the Coalition hardly need spelling out.

On this issue, it's the bishops who are out of touch

Religion and politics have always been a potentially lethal combination. It is way too simplistic to say they don’t mix. Actually the problems usually arise from the fact that they tend to mix only too well.

The question is not so much whether they do mix, but whether they should mix, such is the potential for rival politicians to extract wildly differing interpretations from the same religious texts.

The most infamous blurring of the lines between the two that has occurred in recent years was when Tony Blair declared that he would “answer to his maker” for joining the US-led invasion of Iraq in 2003.

Looking back, I don’t think he was really saying that God told him to go to war. But what the statement did reveal was that Mr Blair saw a clear moral justification for the decision that derived, at least in part, from his purported Christian values.

In theological terms, the former Prime Minister could point to some fairly heavyweight support for his espousal of the so-called ‘Just War’ theory, however politically inept it was to have expressed it as he did.

No less of an authority than the 39 Articles of the Church of England state: “It is lawful for Christian men, at the commandment of the Magistrate, to wear weapons, and serve in the wars.”

But just as Christian pacifists have always taken issue with this point of view, so too has the question of state welfare versus individual charity been another long-running bone of contention among believers.

And it is this issue that pitched religion back into the spotlight this week, as a group of Church of England bishops attempted to scupper the government’s plans for a £26,000 cap on benefit payments.

The days when the C of E was ‘the Conservative Party at prayer’ are thankfully long gone, although it would probably still be fair to call it the SDP at prayer were it not for the fact that the SDP is also long gone.

So it’s not particularly surprising to see them endorsing what is essentially a social democratic position on welfare, highlighting the ‘bias to the poor’ that is found throughout Scripture and in particular in Jesus’ ministry.

But not all agree. For former archbishop Lord Carey, among others, the country’s £1trillion deficit, and the fecklessness and irresponsibility which he claims the benefits culture rewards, constitute far greater moral evils.

"The sheer scale of our public debt is the greatest moral scandal facing Britain today. If we can't get the deficit under control and begin paying back this debt, we will be mortgaging the future of our children and grandchildren,” he wrote.

The theological arguments will go on – but what about the politics? Well, for my part, I reckon the Coalition has got this about right.

While I am normally quite content to see bishops and other faith leaders attempting to bring a moral perspective to bear on policy-making, on this issue they appear to have seriously misjudged the mood of public opinion.

Establishing a benefits cap at what is around the level of the current average wage will hardly be seen as unfair by the great majority of the population, although admittedly it will hit people disproportionately in London where housing costs are higher.

Even that, though, makes a fairly pleasant change from the disproportionate hit that the North-East and its neighbouring regions have had to sustain as the result of other public sector spending cutbacks.

The bigger political picture here is that, in proposing the benefit cap, the government is seeking not only to tackle the deficit, but also to appeal to a group of voters who are becoming seen by both main parties as the key to electoral success over the next few years.

Gordon Brown used to call them ‘hard working families’ – but they have now become known as the ‘squeezed middle,’ people who are working as hard as ever but whose real incomes have declined significantly over the course of the economic downturn.

The bishops and others will worry – quite rightly – of the risk to social cohesion in focusing attention on relatively middle-class voters at the expense of those at the bottom of the income scale.

But even they might have to concede that continuing to condemn such people to welfare dependency is the surest way to create a permanent underclass.

Too late for Ed to change the public's minds

So was it a political masterstroke as some pundits argued, or was it the beginning of the end of his leadership of the Labour Party – as two of the union barons who originally backed him for the job have claimed?

Opinions were certainly divided this week about Ed Miliband’s decision to come out in support of the coalition government’s pay freeze.

For Len McCluskey of Unite and Paul Kenny of the GMB, the move marked the end of Mr Miliband’s “bold attempt to move on from Blairism” and would lead to “certain electoral defeat.”

Others, though, saw the decision to accept the cutbacks – and take on the public sector unions in the process - as a vital first step towards restoring the economic credibility so crucial to Labour’s prospects.

Mr Miliband was of course following what is a well-worn strategy for Labour leaders – seeking to gain traction with the electorate by attacking their own side.

Contrary to popular belief, it was not started by Neil Kinnock at Bournemouth in 1985, but by Jim Callaghan almost a decade earlier in a speech to the Labour conference which later became paraphrased as “The Party’s Over.”

“We used to think we could spend our way out of a recession. I tell you in all candour that option no longer exists,” he told the comrades, burying decades of Keynesian economics and inadvertently paving the way for the Thatcherite consensus.

Mr Kinnock took it a stage further with his attack on the grotesque chaos of Militant-run Liverpool, before the tactic was perfected by Tony Blair, who seemed at times to want to define his entire leadership in opposition to his own party.

As Mr McCluskey was not slow to point out, Mr Miliband had initially attempted a very different approach following his surprise elevation to the job in the autumn of 2010.

His own conference address last autumn, which I described at the time as one of the bravest and most ambitious political speeches of modern times, represented no less than an attempt to refashion the political consensus on his own terms.

Fans of Yes, Minister will of course recall that, in civil service speak, ‘brave’ means ‘potentially littered with banana-skins,’ while ‘ambitious’ means ‘foolhardy,’ and so, alas, it has proved.

The largely negative response to that speech and Mr Miliband’s subsequent inexorable slide in the opinion polls seems to have persuaded him that a new approach is now needed, with the public sector pay announcement constituting at least a partial recognition that the argument over spending cuts has been lost.

But will it succeed in restoring his political fortunes? Well, on this score, it is perhaps instructive to look back at how those previous Labour leaders fared when they decided to take on their own parties.

Jim Callaghan, as conservative a leader as Labour has ever had in some respects, was simply not believable as a party reformer because of his previous track record in blocking Harold Wilson’s attempts to curb union power in the 1960s.

Likewise Neil Kinnock, who before dazzling us all at Bournemouth in 1985 had spent most of his leadership prevaricating over whether to support or condemn Arthur Scargill’s conduct of the 1984-85 miners’ strike.

And so despite its near-mythical status among politics-watchers, the Bournemouth speech had less impact on Kinnock’s popularity with the wider electorate, as was shown when he was soundly defeated by Margaret Thatcher in the general election 18 months later.

Tony Blair, however, was different. Within months of becoming leader, he had made his direction of travel clear, venturing where all his immediate predecessors had feared to tread by abolishing Clause Four of the party’s constitution.

The public was convinced from the start that he was a new kind of Labour leader, and unlike Kinnock and Callaghan, they duly rewarded him at the ballot box.

It is often said of political leaders that what they do in their first 100 days defines them thereafter, that it is in this period that the public makes up its mind about them.

For good or ill, I think the public has made up its mind about Ed Miliband. And decided he is not going to be their Prime Minister.

Scottish independence won't be the end of the devolution 'process'

Back in 1998, a now almost-forgotten former Labour cabinet minister coined the phrase: "Devolution is a process, not an event."

They were in fact the words of Ron Davies, the architect of the Welsh Assembly who is now primarily remembered for his 'moment of madness' on Clapham Common and subsequent 'badger-watching' escapades near the M4.

But as the repercussions of New Labour's devolution reforms of the late 1990s continue to reverberate around the body politic, it is clearer than ever that Mr Davies was spot-on in his analysis.

Just as the former Cabinet secretary Gus O'Donnell predicted in his series of 'exit interviews' before retiring last month, the future of the Union has suddenly become one of the hottest of political hot potatoes.

The extent of the Prime Minister's gamble in seeking to strong-arm the Scottish government into holding a straight yes-no vote on independence within the next 18 months should not be underestimated.

A less risky strategy would surely have been for the Westminster government to carry on doing what it has been doing to the Scots for the past 30 years, namely try to buy them off.

The carrot on this occasion would not have been money in the form of the highly-advantageous Barnett Formula of public spending, but rather the promise of more powers – or “devo max” as it is termed.

By handing significant financial autonomy and accountability to the Scottish government while allowing it to remain in the UK, the government would surely have satisfied all but a minority of pro-independence diehards.

But Mr Cameron appears to have eschewed that option in what appears to be an all-out bid to destroy the Scottish Nationalist First Minister Alex Salmond and kill the idea of independence stone dead for a generation or more.

His attempt to set the timetable for the referendum as well as fixing the question is designed to pitchfork the Scots into an early vote in the hope that they will reject independence.

But will it actually have the opposite effect? Will the Scots simply see it as yet more unwanted meddling in their affairs by a distant English premier whose party enjoys so little support north of the border it nearly decided to change its name?

If so, then Mr Cameron is going to look remarkably stupid before this game of political chess is played out. So stupid, in fact, that it could be he, rather than Mr Salmond, who finds himself out of a job.

The future constitutional position of Scotland may seem like a rather arid subject to those of us south of the border, but for the North-East, it could have some rather interesting political repercussions to say the least.

For starters, an independent Scotland would be more likely to compete aggressively against the Northern English regions for inward investment – an issue that has reared its head from time to time even within the existing Union.

The wider implications, though, would be in the change in political balance within England and the impact that this would have on traditionally Labour-supporting areas.

The secession of the Scots would mortally Labour south of the border, ending any prospect of it holding power alone at Westminster again and permanently shifting the centre of political gravity to the right.

The Labour-supporting regions of the North - whose political cultures in fact have more in common with the Scots than with the Southern English – may well then find themselves even more marginalised by the Westminster Parliament.

This, in turn, might well lead to a revival of interest in the idea of devolution within England, perhaps within a pan-Northern context this time round rather than individual assemblies for the North-East, North-West and Yorkshire.

My guess is that if Mr Cameron’s gamble does backfire, and the Scots ultimately vote for independence, it won’t be too many years before we see calls for some sort of 'Council of the North' encompassing all three regions.

Fanciful? Well, maybe. But devolution is, after all, a process, not an event.

Time for Labour to turn to its own 'Iron Lady?'

And so the new political year begins moreorless exactly where the old one left off…with Labour leader Ed Miliband’s long-term survival prospects once more being called into question.

The run-up to Christmas saw growing unease in Labour ranks over Mr Miliband’s failure to make more headway against David Cameron’s Coalition government, in what seemed like the beginnings of a whispering campaign.

Now that the season of goodwill is over, however, the muttering has broken out into the open, with Labour peer and former adviser Lord Glasman claiming that this week that the Labour leader has "no strategy and little energy."

And yesterday’s warning by Shadow Defence Secretary and leading Blairite Jim Murphy that Labour must have “genuine credibility” on spending cuts is being seen as another shot across Mr Miliband’s bows.

Lord Glasman’s comments were significant not so much in themselves as for the fact that they played into what is fast developing into an over-arching narrative about Mr Miliband’s leadership.

Perhaps his most telling point was on the economy, on which he said: “We have not won, and show no signs of winning, the economic argument…we have not articulated a constructive alternative capable of recognising our weaknesses in government and taking the argument to the coalition.”

He added: “Old faces from the Brown era still dominate the shadow cabinet and they seem to be stuck in defending Labour's record in all the wrong ways."

That was a clear reference to Shadow Chancellor Ed Balls, whose presence in that post is viewed by some as an insuperable obstacle to Labour’s attempts to regain economic credibility.

The ‘credibility’ question was also clearly uppermost in Mr Murphy’s mind as he spoke out the spending cuts issue in a national newspaper article yesterday.

Mr Murphy, who ran South Shields MP David Miliband’s leadership campaign, was ostensibly talking about defence, but the wider message was clear – that Labour needs to stop opposing every government spending cut for the sake of it.

Mr Miliband’s difficulties were compounded yesterday by a leaked memo from his press secretary Tom Baldwin claiming, somewhat absurdly, that he had led Labour to “probably the best recovery of any opposition party in history.”

And he caused himself further embarrassment by referring to the late Bob Holness as the host of ‘Blackbusters’ in a Twitter post as ill-advised as some of Gordon Brown’s YouTube appearances.

So having spent the last year trying to shed the hated ‘Red Ed’ tag, could this be the year when Mr Miliband becomes ‘Dead Ed?’

Well, it is interesting on this score is to see what some of the leading Blairite commentators are saying.

Although a lot of people in the party still believe the wrong Miliband was chosen as leader, there appears to be no great clamour for David to ride to the party’s rescue.

Instead, some of his former supporters seem to be latching onto the Brownite Shadow Home Secretary Yvette Cooper as Mr Miliband’s most likely replacement.

Take this, for instance, from The Independent’s John Rentoul, perhaps the most influential Blairite in the ranks of the commentariat.

He wrote: “Yvette Cooper could have won in 2010, had she not said that the time was not right for her and supported her husband, Ed Balls, instead. If she is clever, the Brownites and Blairites could unite behind her. “

Or this from Dan Hodges, a former Blairite insider and special adviser who now blogs for the Daily Telegraph.

He quoted a Shadow Cabinet source as saying: “Yvette’s the next leader of the party. The only question is whether it’s before the election or after.”

For my part, there is no doubt in my mind that Yvette Cooper is the potential Labour leader which the Coalition fears most.

Mr Cameron already has a ‘problem’ with women voters – some would say with women in general – and he could not get away with patronising the redoubtable Ms Cooper in the way he has tried to do with other female MPs.

The long-awaited release of the Margaret Thatcher biopic yesterday may well focus attention on why the Labour Party has so far failed to find its own ‘Iron Lady.’

Could this be the year they finally put that right?

If you want to see the future of politics, just listen to 'God'

Following on from last week's Review of 2011, here's my look ahead to the political year 2012.

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Predicting the future is always a risky business, but anyone looking for some pointers as to the direction which British politics might take over the next few years could do worse than listen to ‘God.’

Of course, by that I don’t mean him upstairs – though doubtless he might also have something to say about it - but the man who is universally known by that nickname in Westminster circles – the outgoing Cabinet Secretary Sir Gus O’Donnell.

Sir Gus officially retired yesterday as Britain’s most senior civil servant, but not before breaking the habit of a lifetime and firing off a few opinions of his own in a series of exit interviews with assorted media outlets.

In them he warned, among other things, that the greatest challenge facing Britain over the coming years would not be the state of the economy or even its future place in the European Union, but simply holding the United Kingdom together.

Sir Gus’s comments served as a necessary corrective to the fact that the implications of Scottish and Welsh devolution for the rest of the UK have sometimes been overlooked.

In last week’s column reviewing the political year 2011, I noted that the referendum on reform of the voting system held in May last year did not, in the end, prove to be the political game-changer that some of us thought it might be.

But there was something else that happened on the same day which may well prove to be of much greater significance in the longer-term – the outright victory of Alex Salmond’s Scottish Nationalists in the elections to the Scottish Parliament.

We have already seen how Mr Salmond is prepared to use such issues as the Eurozone crisis to press the case for Scottish independence, and we can expect much more of this in the coming year.

On the future of the Coalition, however, Sir Gus was less outspoken, saying that he expected it to run its course until a general election in 2015.

Perhaps it is unsurprising that he should take such a view, in that he played a pivotal role in bringing the Coalition together in the first place, and thus has an emotional stake in its long-term survival.

But ultimately, the Coalition will survive only as long as it is in the Conservatives’ interests for it to survive – and it is here that the underlying political dynamics may well be shifting.

With his party enjoying an unexpected mid-term lead in the opinion polls, might Prime Minister David Cameron be tempted over the next 12 months to try to convert that into the outright Commons majority that eluded him in May 2010?

We shall see. But Mr Cameron is perhaps fortunate in that the issue most likely to bring about a split between the Coalition partners is one on which his party enjoys far greater public support than the Liberal Democrats, namely Europe.

As John Redwood pointed out earlier this month, an election over the UK’s future relationship with the EU would be a very easy one for the Tories to win, and Mr Cameron would not be human if he did not at least toy with the idea of engineering one.

But if that Tory opinion poll lead is raising questions about the future of the Coalition, it is raising even more urgent ones about the future of Labour leader Ed Miliband.

His survival in the role must now be open to real doubt and is surely set to be one of the big running political stories of 2012.

History, at least, would suggest that Mr Miliband has little to worry about. The Labour Party does not do assassinations, and invariably allows its leaders the chance to fight at least one election even if they are patently not up to the task.

Against that, both Neil Kinnock and Michael Foot were at least able to demonstrate mid-term opinion poll leads over Margaret Thatcher, even if they went on to crushing defeats.

Mr Miliband has gained an unlikely ally in the Tory columnist Peter Oborne, who this week praised his attempts to move away from what he called the “manipulation and cynicism of the modernising era. “

But while 2012 may well see a growing appetite for a more value-based style of politics, it is far from clear that the public sees Mr Miliband as the man to deliver it.