The beef between Theresa May and Phillip Hammond is really bad

Theresa May and Philip Hammond’s ‘cordial’ relationship is descending into old school sniping.

This weekend's Sunday Timeshasreported the alleged slagging match underway between the Prime Minister and her Chancellor of the Exchequer.

The relationship which began as businesslike appears to be becoming particularly spicy.

In history, Downing Street has nearly always been suspicious of an over mighty Treasury.

Upon arriving in what is supposedly the seat of government at Number 10, many prime ministers and their advisors are often surprised to find they're on the back foot, compared to their neighbour in Number 11.

The prime minister doesn’t actually have a department behind them, no figures to back up their ideas, and no control over the spending of every other department.

That's all the remit of the Chancellor, even if nominally the prime minister is 'First Lord of the Treasury'.

It's therefore little surprise that so many prime ministers feel the need to neuter this power rival right on their doorstep.

Resilient Treasury

The Treasury itself has also proven resilient to hostile takeovers.

In 1964 Harold Wilson tried to sever the head of the secretive department by taking away its remit for economic planning and creating a new department of economic affairs.

The ‘DEA’ was abolished within five years, mainly due to Treasury chicanery, such as the many convenient excuses for stopping Treasury staff from being transferred to the new department.

In more recent history, in 2005 Tony Blair purportedly dabbled with moving Gordon Brown away from his fortress in the Treasury, and to the less power and less proximate Foreign and Commonwealth Office

Insurance schemes

During the budget on Wednesday, Phillip Hammond announced that National Insurance contributions for the self-employed would rise.

The policy has been criticised for penalising entrepreneurs, as well as breaking a pledge in the Conservative Party's 2015 manifesto.

The row has seen new sniping between Prime Minister and Chancellor, as yet unseen in the May Ministry.

The Sunday Times reports a blame game from aides of the Prime Minister and Chancellor respectively, as well as from their colleagues in the cabinet.

More remarkable than what’s been said, is the lack of attribution, a handy insurance against accusations of disloyalty and betrayal.

Blaming Hammond

A variety of 'senior Conservatives', ministers 'close to May' and others from the top table have piled in on Hammond, giving blind quotes to the Sunday Times.

Theresa May did not support the NI rise. It was smuggled into the budget.

- One unidentified aide reportedly told a ‘senior Conservative’ that May didn’t know about the policy.

George [Osborne] threw this [proposal] out, but Hammond has swallowed it hook, line and sinker.

I don’t think they flagged it enough to No 10 who have got a lot going on.

- A Ministerial aide.

The argument they are using that the manifesto meant only class 1 NI contributions is ridiculous.

The chancellor abolished small print last week in consumer contracts and now he’s telling voters to read the small print.

- Said the same aide.

[Hammond is] clueless about politics

- 'Critics' of Hammond.

Philip did not mention the manifesto issue in cabinet and nor did Ben Gummer, one of whose jobs is to enforce manifesto commitments

- A Cabinet colleague.

Philip is very imperious. He thinks little people don’t matter. The worst thing is he’s sacrificed our reputation for trustworthiness. The public sees Theresa as sensible, but this just looks like a sneaky accounting trick. Hammond has no appeal to the public, but he won’t listen to anybody because he thinks he’s the cleverest person on earth. Delaying won’t do the trick. We need to kill it now. But even if we do, you can’t put lost trust back in the bag

- A ‘minister close to May’.

Talk to people at the Ministry of Defence and the Foreign Office [Hammond's previous departments] and they say that while he was forensic, he was prone to a gaffe. But because he doesn’t attract the level of attention of, say, Boris or David Davis, a lot of his gaffes have disappeared.

– A cabinet source.

He’s lost the big arguments. He lost on the single market, he lost on the customs union and now he’s lost on his budget. There’s no appetite for going to Philip’s defence. He just doesn’t seem very good at politics.

- A conservative advisor.

Blaming May

Similarly, allies of Hammond have reportedly accused May of “stealing” his ideas, censoring his budget speech, and her staff of 'economic illiteracy'.

She left Philip with nothing but bad news to announce on the day

– Hammond ‘ally’.

She wants a death tax. We don’t.

– Hammond aide.

The biggest concern in the Treasury is that if Hammond cannot be seen to deliver now, his reputation will take a battering with the markets. When he has to deliver more difficult decisions over Brexit there will be uncertainty.

– A House of Commons source.

Total tosh

- Hammond aide on the idea that Hammond had snuck the NI rise in without May’s knowledge.

No 10 were pressing for more money. They have all these pet projects and they are very relaxed about raising tax. Theresa’s instincts are clearly to tax and spend. There’s an economic illiteracy in No 10. There’s no one there who knows much about economics.

– a Hammond confidant.

The press, starved of the flurry or press releases that came from David Cameron's Downing Street, has gobbled up these slanderous morsels ravenously.

HT The Sunday Times, Adam Bienkov

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