The knives are out for Labour’s Shadow Chancellor Ed Balls, who has been left vulnerable after a row with his leader Ed Miliband over how to fund higher education. A shadow cabinet member has said that, if Labour win the next election, Balls should be moved from the Treasury thanks to the two men being seen to be “at logger-Eds”.
It’s is well known that the men, who were both aides to former Chancellor Gordon Brown for many years, don’t see eye to eye. “Ed M doesn’t believe markets work; Ed B believes markets work. It is a fundamental difference,” one aide told the Sunday Times. “Ed M believes that the only way to make people better off is to make things cheaper with regulation — pointing at things and saying they should be cheaper. He thinks that the crash changed everything. Balls doesn’t think that the crash was a game-changer. People didn’t move to the left and the economy has not changed.”
“Miliband really is committed to the environment but Balls thinks you should just build on things to create growth — he has a ‘tarmac agenda’ of roads and runways,” the aide said. And while Balls is “cool” on hounding business over tax avoidance, Miliband is not.
“They don’t like each other and they don’t respect each other,” said a Labour front bencher. Their differences aren’t only policy based though. Balls was the senior aide when the pair worked for Brown, and was sore about coming third in the leadership election.
An ally of Balls has said “Ed struggled initially to come to terms with Miliband being the man. He reconciled himself to that a long time ago but they’ve never really had a conversation about it all,” although others who know both men insist that there will not be a return to the Blair-Brown years, when Labourites quipped the party suffered from the TB-GBs. “They watched Tony and Gordon up close,” one senior figure said. “They have promised themselves and each other that it will never get like that.”
Nonetheless, a recent spat over funding of higher education has opened up fault lines between the pair. Miliband is known to favour a reduced cap on tuition fees of £6,000 a year, but Balls has been unable to find the £2 billion a year needed to make it happen. And his allies are contemptuous of the promise, first made by Miliband three years ago.
“All the direction of travel is towards a graduate tax. Our clear argument is going to be that the system is broken and unsustainable. Why do something that makes it even more so? By going for a £6,000 limit you’re blowing a hole in your argument.” said one.
A meeting held last Wednesday designed to break the standoff “ended badly”, and no solution was found. Both Chukka Umanna, the shadow business secretary and Tristram Hunt, the shadow education secretary have seen off attempts by Balls to raid their department’s budgets in order to fulfil the promise, leaving Balls to calculate whether new taxes on pensions or businesses could be levied instead.
But questions have been raised over his heavy-handed approach, and left Balls open to criticism. “Ed M is talking about responsible capitalism, Ed B is talking about fiscal responsibility and Chuka Umunna [the shadow business secretary] is talking about jobs and growth. There’s been no single economic script. That’s the shadow chancellor’s fault,” said one insider.
A shadow cabinet source has revealed that Miliband considered moving Balls from the Treasury breif last autumn but had to change his mind after his conference speech foul-up, in which he forgot to mention the deficit, left him in a weak position.
A frontbencher confirmed that was the case, arguing that Balls should be moved on if Labour win the election in May. “Ed M was tempted to do something about Ed B last year but he came out of conference really weak and it became impossible to do anything,” he said. “Miliband will be in a strong position [after a victorious election] to get rid of people who have not been loyal because he will have won when some people have written him off.
“If Balls carries on behaving like this he is not unassailable. He really doesn’t think that anyone else is entitled to have an opinion on money or anything else. He has complete contempt for colleagues. He’s not a team player.”