Knives out for Osborne in Tory backlash
Gove rallies to Chancellor’s side in bid to stop benefits row engulfing party
DOWNING STREET was battling to avert a full-blown leadership crisis last night as George Osborne suffered an unprecedented backlash from Conservative MPs.
The Chancellor was facing calls to be demoted from his colleagues inside government due to his botched handling of the row over cuts to benefits for the disabled.
Senior MPs warned that Mr Osborne’s hopes of succeeding David Cameron had been fatally undermined by the furore, which led Iain Duncan Smith to quit the Cabinet on Friday night.
But two leading Eurosceptics rallied to Mr Osborne’s defence. Writing in The Sunday Telegraph, Michael Gove puts aside his differences with Mr Osborne over Europe to express his heartfelt support for his “friend”, the Chancellor, and his Budget.
Priti Patel, who was said to have been considering her position over the welfare cuts, also praised the Chancellor and announced she would be staying in her role as employment minister.
Late on Friday night, Mr Duncan Smith shocked Number 10 by announcing he was quitting the Cabinet in protest at Mr Osborne’s “distinctly political” cuts to benefits for the disabled.
His resignation ignited an extraordinary new wave of infighting between David Cameron and Right-wingers, who are already at war over the EU referendum. In other developments: Downing Street was forced to confirm that Mr Cameron retained full confidence in his Chancellor;
It emerged that a furious Mr Cameron berated Mr Duncan Smith over his “dishonourable” decision to quit in an angry phone call on Friday night;
Friends of Mr Duncan Smith hit back at Mr Osborne’s supporters who claimed that the welfare secretary was “obsessed” with Europe and had never raised objections to the cuts before resigning;
Mr Cameron was warned he must promote more Right-wingers after he announced that Stephen Crabb, the pro-EU-Welsh Secretary, would replace the Eurosceptic Mr Duncan Smith.
The row broke out at a critical time for the Chancellor. He is battling to keep Britain in the EU and has been undermined by a series of defeats over key reforms.
Within the past month, successive rebellions by Tory MPs forced Mr Osborne to abandon radical reforms to pensions and plans to relax Sunday trading laws.
The growing revolt from backbenchers over cuts to Personal Independence Payments for 640,000 disabled people, detailed in last week’s Budget, threatened another defeat for Mr Osborne, before the Treasury announced that the plans were being kicked into the “long grass”.
Mr Cameron’s allies had hoped his friend Mr Osborne would succeed him when he steps down before the next general election.
But last night, even sources inside the Government suggested Mr Osborne should be moved to a different post.
One minister privately suggested Mr Osborne would benefit from moving to become foreign secretary in the next Cabinet reshuffle. Another member of the Government said Mr Osborne’s leadership ambitions were “dead in the water”.
“The backbenches are restless. The newspapers have concentrated a lot about Europe and that has masked some pretty serious rumblings,” the government figure said. “The conversation is around
things like disability benefits, Sunday trading and tax credits. George’s position is pretty precarious right now.
“There’s going to be a reshuffle in July after the referendum. [The Prime Minister] should move George to the Foreign Office and replace him in the Treasury with Theresa May.”
Meanwhile, back-bench Tory MPs have launched an “anyone but George” campaign in an attempt to stop him becoming the next party leader.
One backbencher suggested that Mr Duncan Smith has “Geoffrey Howed” the Chancellor, a reference to the former deputy prime minister’s devastating resignation speech, which is credited with helping end Margaret Thatcher’s premiership.
Bernard Jenkin, the senior Tory MP, said Mr Osborne’s “high handed” and “short-termist” approach had tested the patience of a number of ministers.
Another Conservative MP said: “This is an ultra-shambles. I’ve been speaking to people and they’ve been saying it’s ‘anyone but George’ for the Conservative leadership. It’s been a horrible period, more than one person has said to me that these disability cuts made them question their Conservative values.”
Mr Osborne is likely to look for alternative ways of saving the money in his Autumn Statement later this year.
In his article for this newspaper, the Justice Secretary makes an impassioned appeal for unity among the warring factions within the Tory party.
“I am convinced that this country has been changed – significantly – for the better in the last six years because the Conservative Party’s been in office,” he says. “Two of the people who have made the biggest difference for good are two friends of mine who are both great Conservatives.”
Mr Duncan Smith is an “inspirational social reformer” who has “earned the right to make his own decisions on matters of high principle”, he says. Mr Osborne, meanwhile, is “a brilliant chancellor” who has delivered a “radical” and “progressive” Budget.
His intervention – made with the full knowledge of Number 10 – is likely to be seen as a sign of how seriously Downing Street is taking the crisis. As a key campaigner in favour of Brexit, Mr Gove’s support will be welcomed inside Number 10 and Number 11.
Last night, Baroness Altmann, the pensions minister, took the highly unusual step of accusing Mr Duncan Smith of undermining her work in government and said she looked forward to working with Mr Crabb.
“IDS undermined my efforts to help on important pension policy issues like women’s pensions,” she wrote in a posting on Twitter.
‘The PM should move George to the Foreign Office and replace him in the Treasury with Theresa May’