Crosby casts his eye over policy, turning particular attention to Cameron’s 2012 conference speech, of which Number 10 is still so proud. He views it as a big improvement on the modernising agenda that dominated 2010–12, but quarrels with the language. He likes the notions of ‘aspiration’ and ‘global race’, but they need to be made personally relevant to voters if they are to strike a chord with the values that they hold. ‘Global race’, he says, is inadequate shorthand for an interconnected world where people will fall behind if they don’t make progress.12 He embraces the speech’s ideas, but wants to communicate them in a way that will be relevant and attractive to voters.
‘Scraping the barnacles off the boat’ is the widely reported expression Crosby uses when he arrives, by which he means that the team has to strip away policies which are dividing the Conservatives or damaging or irrelevant to voters and concentrate instead on clarifying the strategic message. He is blunt with Cameron, telling him he is concentrating too much on foreign policy, and that he has to drop issues he has become interested in, like combating modern slavery, which, although hugely important, are not priority issues for voters. ‘I thought they were overindulgent, failing to distinguish between the issues that mattered to people, and second and third order issues.’ The fundamental weakness is that there is no story about their purpose. ‘My job is to be the navigator, give confidence in the route map and equip them with the diagnostic tools they need. The route map is the simple narrative about economic competence and security, rewarding hard work, reforming welfare, being firm on immigration, focusing on DC as an asset of his party and holding Labour to account more effectively.’13 Bit by bit, he nudges Cameron and Osborne to what the research shows is relevant to voters in 2014/15. He has iron discipline and keeps tight control of the polling through his political strategy company, Crosby Textor. ‘My job is to make sure we stay on the train tracks’ is a frequent refrain. Matthew d’Ancona describes him as ‘a bull of a man, bespectacled, mild on first encounter but evidently fizzing with barely suppressed energy. He [told] visitors only that the election was “winnable” … [He] did not make a habit of working for losers.’14 By mid-2013, he has achieved traction in Number 10 and the party because of his aura as a campaign guru, but also because he is an ‘alpha male Australian who shouts and swears at them, which they all know they need’, as one insider puts it. Not all are such fans.
Crosby knows time is not on their side. In March 2013 he chairs his first meeting with what Cameron describes as the ‘core election planning group’ at an away day in Chequers. Crosby tells them that they are effectively already in the campaign and all policy announcements have to be agreed and strategically focused. Anything that creates further discontent within the party must be stopped. He is complimentary about the critique of Labour the Conservatives developed in 2012, but scornful about the failure to follow it in a disciplined way. On 12 June, Crosby addresses a meeting of the 1922 Committee, in the presence of Osborne and Cameron. The PM tells them that the campaign in 2010 suffered because there was no one figure in charge, and that Crosby will be the sole person running the 2015 campaign. Crosby tells MPs that Labour’s lead in the opinion polls can be reversed, that Labour are vulnerable on welfare, the deficit, and Europe, and that both Miliband and Balls are seen to be weak by floating voters.15 In September, he presents his research to the Downing Street team: ‘Central concern of voters is economic security and international security. Security is core,’ he tells his rapt audience in Mrs Thatcher’s first-floor study in Number 10. He talks about his in-depth research into the values expressed by the two rival candidates in the 1984 US presidential election, Ronald Reagan and Walter Mondale: while the left owned public services, the right owned economy and jobs. He has reached the conclusion that the Conservatives, like the victorious Reagan, have the right policy on the economy, but lack a deep emotional identity with voters. His work feeds through into the slogans of the 2013 party conference, ‘A Land of Opportunity for All’, and the 2014 party conference, ‘Securing a Better Future’.
Crosby’s unassailable rise is at the expense of Andrew Cooper, who leaves Number 10 in October 2013. When Cooper was appointed it was on the understanding that he would return to the polling company he founded, Populus, after one or two years in Number 10. Crosby may not have warmed to Cooper’s modernising drive, but he is respectful of his work – at the March election meeting he goes out of his way to praise Cooper’s contribution over the previous eighteen months. Soon after Crosby joined the team, Cooper tells him of the arrangement he has made with Cameron, and that he is willing to leave after the local elections in May. However, Crosby encourages Cooper to stay. Despite their best efforts, they frequently disagree, strongly over the NHS. While Cooper believes ‘we have to sort it out’, Crosby’s line is ‘the best thing we can do is simply to ignore it and keep talking about the economy’. Crosby’s strident style too is more what many feel is needed in contrast to Cooper’s more nuanced, inclusive approach. Cameron is initially reluctant to see Cooper go, but the rest of his team are crying out for the metallic certainty of Crosby.
Cooper had already warned Cameron of his misgivings about Crosby during a long conversation in the PM’s car the previous year. Cameron told Cooper that he and Osborne were still haunted by the 2010 campaign. ‘The endless meetings, the discordant voices, the endless indecision, the cancelling of posters a day before they are due to go out. It drove us all nuts!’ he said. ‘We have to have one person to be the sole director of the campaign.’
‘You can’t have Lynton without having “Lyntonism”,’ Cooper replied, referring to the core-vote agenda he pursued in 2005.
‘We won’t have Lyntonism because my judgement is better than Michael Howard’s,’ was Cameron’s response.
But then Cooper says that he is being placed in an impossible position, given that Crosby’s control of private polling is sending out the signal that Cameron no longer trusts Cooper’s analysis. ‘That’s not what I think,’ Cameron says. Cameron is uncomfortable, because of his affection and respect for Cooper, and unwilling to see him leave. When a story appears in the Mail on Sunday in April that Crosby and Cooper are embroiled in a power struggle, Cooper offers to leave immediately – but Craig Oliver implores him to stay until the autumn, not wanting to give any credence to the report.16 While Cooper agrees to continue as a part-time adviser, paid by the party, it is clear power has already passed to Crosby, and there can be only one figure in charge.
In July 2013, Crosby comes under attack for his business connections, particularly after the government, on 12 July, announced that proposals to introduce plain packaging on cigarettes would be put on hold. That day, the media also reported that a plan to introduce minimum pricing for alcohol was to be abandoned.17 Labour links the decisions with Crosby’s work for tobacco giant Philip Morris. Shadow public health minister Diane Abbott says, ‘We have to ask, what happened? We suspect Lynton Crosby happened.’18 Sarah Wollaston tweets, ‘What a tragic waste of an opportunity “barnacles scraped off the boat” aka more lives ruined for political expediency.’19 Cameron tells Andrew Marr that Crosby played no part in the decision. But Cameron recognises that the problems are not going to go away, and Feldman holds conversations with Crosby over the summer, resulting in the decision, announced in November but decided long before, that he will now work full-time for the Conservatives. He will have no need to work for other organisations that might be portrayed as conflicts of interest.20 As part of the deal, Crosby’s business partner Mark Textor and his team come on board.
Crosby and Textor become convinced that the ‘long-term economic plan’ is the key organising idea for the Conservatives. ‘We needed to show that David Cameron and the Conservative Party have an eye to the future, and are not just driven by opportunism, responding to the latest issue or the next controversy: it was all about consistency, continuity and purpose.’21 For Boris Johnson’s 2012 London campaign, Crosby had come up with a nine-point plan. With Ca
meron it is to be a five-point plan. The idea is foreshadowed in Cameron’s 2013 party conference speech and then expanded in a speech to the CBI on 4 November.22 It is subsequently refined as the ‘Big Five’ objectives: cutting the deficit, reducing income tax, creating more jobs, capping welfare and immigration, and delivering the best schools and skills for young people. The subliminal message is that ‘we are working for something better in the long-term and the Conservatives are not just a bunch of opportunist politicians or short-term interventionists’.23
As the general election comes into view, Crosby becomes a powerful figure in Cameron’s team, the equal in punch of Osborne, and the strongest since the departure of Coulson and Hilton. When he goes full-time from November 2013, his voice becomes even louder. Osborne remains the ‘big-picture guy’ adjudicating the broad outline of government policy, but it is Crosby who now helps them to ‘sell’ those policies. ‘We don’t do anything now without talking first to Lynton,’ says one team member. He works hard in the first part of 2014 to win over MPs individually and in groups, becoming a ‘human shield’ for Cameron. Crosby’s politics are much more in tune with many MPs than those of Cameron. They like his messages and his emphatic style. But as the year drags on, criticism of him mounts. As polls fail to improve, MPs blame him for placing too much emphasis on economic policy. They worry that that alone will be insufficient. ‘He has completely misread the mood of the British electorate,’ says 1922 chairman Graham Brady in November. In the same month, a ComRes poll places the Conservatives on 30%, exactly where they had been a year before, and by early December it puts the Conservatives on just 28%.24 Crosby may have brought order to the Cameron premiership; he had yet to bring it success.
TWENTY-FOUR
Warfare Over Welfare
May 2010–December 2014
‘We will all need to hold our nerve,’ Welfare Secretary Iain Duncan Smith tells Cameron early in the New Year. ‘Everything is happening in 2013. It’s going to be the bumpiest year we face on welfare. I don’t need anyone to blink.’1 He was not being alarmist. In April 2013 alone, housing-benefit changes (including the controversial spare-room subsidy or ‘bedroom tax’) come into effect, the Personal Independence Payment scheme (PIP) replaces the Disability Living Allowance, the ‘pathfinder’ trial begins for IDS’s flagship policy, Universal Credit (UC) – the merging of six means-tested benefits and tax credits into one monthly payment – and in July, the household benefit cap is introduced. The 2010–15 government sees a welter of activity on welfare. This chapter’s focus is on UC. For IDS, working to fulfil a lifelong dream of welfare reform, this year is critical.
Public concerns have been building about UC, and continue to do so well into 2013. In December 2012, Philip Langsdale, who had been brilliantly project-managing it, died after only a few weeks in post. In February 2013, the Major Projects Authority (MPA) orders a ‘reset’ of UC, while in September the National Audit Office (NAO) heavily criticises the IT programme, claiming it has resulted in £40.1 million in wasted expenditure. In November, the Public Accounts Committee (PAC) chaired by Margaret Hodge, nicknamed ‘the fishwife’ at the Department for Work and Pensions (DWP) for her aggressive manner, turns on IDS. It all leads to a widespread belief that UC is a failed scheme that will never see the light of day.
DWP feel these critical reports are woefully out of date, providing analysis based on recommendations already initiated by IDS and the department in 2011. It is not surprising that given the huge changes in welfare reform over this parliament, there would be teething problems, they respond.
IDS, and his UC policy, have been a source of division between prime minister and chancellor. Both men think very differently. Cameron is fervently committed to welfare reform, but does not immerse himself in the detail. ‘I remember a couple of meetings about a welfare programme in Number 10 in the first few months: there was very little interest there, and it was only with a lowly adviser,’ recalls a DWP official. IDS himself makes it clear to Cameron on his appointment in 2010 that he only wants to be Welfare Secretary if he is allowed to introduce UC: Cameron readily agrees and says he will stand by him. Cameron might lack IDS’s deep Christian faith, but is fired by a similar moral zeal for welfare reform, to ensure that benefits are targeted only on those who need or deserve them. His overtly moral approach is alien to Osborne’s world view. ‘The fundamental tension is that George and Iain are not natural bedfellows,’ says a senior figure in the Treasury. Osborne forms the view, shared by some in Whitehall, that IDS is ‘too stubborn to come up with the costs and consequences of what he is proposing’. He also worries whether IDS has the intellectual firepower to handle his brief. One supporter of IDS blasts Treasury civil servants for their lack of support: ‘Officials stirred up Treasury ministers to be very, very concerned that it could all go terribly wrong and cost an arm and a leg and destroy all the welfare savings.’ The Treasury’s drive for savings across the entire DWP budget, irrespective of UC, and IDS’s refusal to see any part of UC cut, creates much tension. ‘The conflict was that Iain was only interested in reform and Universal Credit, but George desperately needed to save money,’ recalls one Treasury aide. ‘There was a mixture of personal and policy decisions causing tensions between IDS and Osborne,’ says a senior Whitehall figure.
By 2011 IDS’s proposals come under similar pressures to Lansley’s at Health. But where Lansley falls, IDS survives the 2012 reshuffle, and the tribulations of 2013. What explains the difference in their fates? Welfare does not have the same emotional resonance with the public and media as health care. While people are ever alert to bad NHS news stories, many never fully grasp or experience first-hand the problems in implementing UC. Public opinion is largely behind the need for reform; in July 2013, a poll suggests 73% of the public support the household benefit cap.2 IDS, unlike Lansley, has powerful friends on the right of the parliamentary party, and among the commentariat, notably ConservativeHome blogger and later comment editor of The Times, Tim Montgomerie.
Peel away the Whitehall lid too and we see the powerful hand of the Number 10 permanent secretary, Jeremy Heywood. While cautious about health reforms, which he believes are undoing progress made under Blair and Brown, he is supportive of welfare reform. From the very first meetings in the summer of 2010, he tells Cameron and IDS that ‘Universal Credit is a right reform to do – worth the upheaval and the change.’ Heywood knows that every Work and Pensions Secretary for a generation has wanted fundamental welfare reform. Following a critical meeting in Number 10, at IDS’s request, and the assurance of the DWP’s permanent secretary Leigh Lewis that the project is achievable from an IT perspective, Heywood agrees that the prime minister should accept the advice and move forward. Cabinet Secretary Gus O’Donnell pins the blame for the later problems of UC on the government trying to introduce too much radical reform so quickly, a fruit of the Steve Hilton philosophy that speed and steely purpose should go hand in hand in those first months. O’Donnell believes that Cameron’s team, fresh to government, lack the resources in Number 10 to grip all the measures they are seeking to drive through simultaneously. But IDS has other powerful supporters, including Hilton, albeit an initial sceptic, and Oliver Letwin.
Furious rows with the Treasury emerge in no time. During the party conference of 2010, to IDS’s anger, Osborne announces cuts in child benefit for higher-rate taxpayers without consulting him, and the warfare continues throughout 2011 and 2012. The Treasury insists on continued savings while giving IDS just enough leeway to prevent him from resigning. The DWP blames the Treasury for tightening the money so much that UC could not be rolled out properly, and believe they were not consulted fully over the replacement of the Disability Living Allowance by PIP. The latter, and the decision to link benefits to the Consumer Prices Index instead of the Retail Price Index, produce the biggest savings. The Treasury rub salt in the wound by claiming that many of the welfare successes in 2010–15 are down to their own innovations, rather than those of the DWP, and that I
DS and the DWP are muddled and inefficient. IDS, despite his hard pounding at the DWP, remains throughout bloodied but unbowed. Few ministers suffer more from negative briefing, some from the Treasury, and, for a time during 2013, from his own department. His press is largely hostile, with Polly Toynbee in the Guardian a high priest. A withering attack by Philip Collins appears in The Times, mocking IDS for his ‘evangelical fervour’, describing UC as a ‘gothic folly’ and IDS as guilty of ‘the sin of hubris’ heading towards ‘political disaster’.3 He does have some cheerleaders, including the Spectator’s Fraser Nelson and Peter Oborne in the Telegraph, who describes the UC story as ‘one of the most dramatic in post-war political history’, heaping praise on IDS for his tenacity in piloting it through.4
IDS’s moral zeal for reform is a cause of mockery in some quarters. In 2004, the year after he stood down as party leader, he established the Centre for Social Justice (CSJ) as an independent think-tank. He had visited many of the UK’s most disadvantaged communities, encountering ‘levels of social breakdown which appalled me … [especially] in the fourth largest economy in the world’.5 The CSJ identified five separate pathways to poverty: family breakdown, failed education, addiction, debt, and welfare dependency. ‘We always knew that we could only tackle one of these in a five-year term,’ said Philippa Stroud, his special adviser who followed him from the CSJ into government; ‘we were given the opportunity to tackle welfare dependency’. The groundwork for UC was laid in the CSJ’s publication Dynamic Benefits in 2009, the brainchild of academic turned management consultant Dr Stephen Brien.6 IDS may have put in much of the preparatory work, but had not expected to be appointed in 2010: ‘It was a total surprise. I wasn’t expecting it.’7 In fact Cameron admired IDS’s dedication to social reform, thinking for some time that he would offer him the post. Now IDS had the chance to salvage pride after his lacklustre leadership of the party.
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