‘The day of spin that spun out of control
CASUAL listeners to the Today programme yesterday may have assumed that supporters of David Cameron had wrested back control of government economic policy.
Sir Oliver Letwin, a former Cabinet minister and key Cameron aide, was given the prime 8.10am broadcast slot by the BBC where he effectively declared the era of ‘austerity’ over for Britain.
Raising the prospect of selective higher taxes to reduce the deficit, Sir Oliver went much further by floating the idea of removing the cap on public sector pay.
Sir Oliver said: ‘I think sooner or later there will need to be some movement on the rate of increase of public sector pay because we are getting close to the point at which the huge increase in public sector pay compared to private sector pay which we inherited in 2010 is levelling out. I have no doubt that at some point or other we will need to look at that.’
Within minutes, both Sir Craig Oliver, Cameron’s former spin doctor, and Daniel Korski, another exNo 10 apparatchik, took to social media to praise Sir Oliver. Sir Craig hailed a ‘lesson in fiscal reality’, adding: ‘Taxes will have to rise if we want better public services and controlled borrowing.’
Mr Korski, meanwhile, described the ‘brilliant’ Sir Oliver’s intervention as ‘very enjoyable’ and ‘spin resistant’.
But more was to come – and this time from the current Government.
A couple of hours later, Sir Michael Fallon, the Defence Secretary, was asked if defence budget increases could include a rise in salaries to cope with inflation.
He said: ‘That is obviously a huge question. But it is obviously something we have to consider not just for the Army but right across the public sector as a whole.’
SHORTLy afterwards, Chris Grayling, the Transport Secretary who ran Theresa May’s Conservative Party leadership campaign, strongly hinted a shift may be coming on the pay cap. Talking about the Chancellor, he said: ‘Philip Hammond has said we obviously have to learn lessons from the general election. We will have a budget later this year.’
At Parliament, Conservative MPs openly speculated that Letwin, Fallon and Grayling were part of a carefully stage managed operation by Downing Street. The assumption was they were being used to test the water for a major change of policy on public pay.
The timing was also significant. They were speaking out on the day that Jeremy Corbyn and the Labour Party were publishing their alternative Queen’s Speech. Most Labour MPs were yesterday also wearing badges from the Royal College of Nursing bearing the slogan: ‘Scrap the cap!’
In truth – far from being a joined-up operation – the ministers were speaking in a personal capacity about the public sector employees who fall under their aegis.
The process also began more than a week ago in little-noticed remarks from Jeremy Hunt, the Health Secretary.
In one of his first outings since the election, Mr Hunt was in Liverpool to address the NHS Confederation, which represents hospital trusts.
He said: ‘I have a great deal of sympathy for the case that nurses amongst others have made on the issue of pay. I think they do an absolutely brilliant job.’ Praising the NHS’s 270,000 nurses for working large amounts of unpaid overtime, he said: ‘I have a great deal of sympathy for the case that nurses have made. They do a brilliant job, they work hard and I am aware they give the health service an extraordinary amount of time for free.’
Inside No 10 yesterday, there was initially irritation at the idea that Theresa May was pulling all the strings.
‘All these answers and interviews are being way over-interpreted,’ said one source.
But by lunchtime Downing Street had dropped a strong hint the cap was on the way out. ‘There are a number of pay review bodies that are reporting and the Government will be considering their recommendations,’ a Downing Street source said.
ONe senior minister said: ‘They were definitely all conducting freelance operations but it was the day to do it – the day of Labour’s Queen’s Speech publicity stunt. If there are three ministers calling in public for the cap to go there are even more in private. I think we can assume it is probably going to happen.’
But by late afternoon Downing Street was briefing there was no review after all of the public sector pay cap.
Chancellor Hammond, it was said, was spitting feathers over his apparent loss of control of economic policy – leaving Mrs May’s spokesman to say 15 times that the policy of public sector pay restraint was unchanged.
A Cabinet source said: ‘What a mess. We need to get a grip of our messaging. Fast.’