The last nine months of the parliament witness the most critical questioning of Britain’s standing on the world stage since the 1970s. The speculation can be traced in part to a cool wind blowing across the Atlantic from Washington. The criticism finds expression, albeit in private, during Cameron’s White House visit in January 2015. On the flight home, Cameron refers to American concerns about Britain and how, unusually, the president had come back to this several times. Something of the White House’s questioning seeps into Washington’s political bloodstream. Number 10 doesn’t believe that the president is orchestrating it, though some more junior White House aides might be. In March, head of the US army General Raymond Odierno launches a public salvo. Because of cutbacks, he says, Britain will no longer be able to commit division-sized forces to future combat operations, adding that he is ‘very concerned’ about the falling proportion of defence spending in the UK.12 Throughout the spring, British ambassador Peter Westmacott reports back to Number 10 about Washington’s concerns regarding Britain’s ‘strategic drift’. There are still more damaging broadsides from nearer to home: the International Institute for Strategic Studies reports in February that the cuts have resulted in a 20–30% reduction in Britain’s defence capability.13 Then a report in March from the respected Royal United Services Institute claims that the British army could now be reduced to its smallest size since 1770, with just 50,000 troops.14 It receives widespread publicity on both sides of the Atlantic. Number 10 think the claims alarmist and absurd. But the criticism keeps rolling in.
On 5 May, just two days before the general election, Vice President Joe Biden spends an hour with the British chiefs of staff, who are making a call to their opposite numbers in Washington. He tells them: ‘We Americans have a higher bar for you Brits than for the rest. You are a pillar of NATO and we expect you to show the way. We have elections coming up next year, and middle-class America is fed up with having to cough up the money to sort out security in Europe.’ The concern is this: the US accounts for more than 70% of NATO’s military spending. Britain might have the fifth largest defence budget in the world, but Washington worries that if Britain isn’t prepared to commit to the 2% in the future, there is little hope that other nations will follow suit.15 Disillusion in Washington finds its sharpest expression in an article in the Washington Post in May which makes a powerful claim: ‘after an extraordinary 300-year run, Britain has essentially resigned as a global power’.16 The piece that most gets under the skin of Cameron, though, appears in the Financial Times in the same month arguing that ‘Britain [has] decided it’s going to turn in its deputy sheriff’s badge and let the US play the role of world policeman alone’.17 He is visibly upset and irritated, telling his team that the piece is grossly unfair.
Disillusion with the British government from within the American military, defence and security community is actively fed by their counterparts, many retired, within the United Kingdom. Richard Dannatt – former Chief of the General Staff, briefly official adviser on defence to Cameron in Opposition, and a constant critic of both Blair and Brown – is the most vocal. Dannatt constantly jabs away at Number 10. Almost equal an irritant is Richard Shirreff, the British general who served as Deputy Supreme Allied Commander in Europe until 2014. In February 2015, he says that Britain has become a mere ‘bit player’ on the world stage and in the midst of the most serious international crisis for fifty years Cameron has gone AWOL.18 One aide dismisses him as ‘totally off the wall’. Shortly after, the former Chief of the Air Staff Michael Graydon attacks the British government’s policy as ‘disappointing and, indeed, frankly shameful’.19
Criticism of Cameron for lacking a clear strategic sense of foreign policy, widely aired in David Richards’ 2014 memoir Taking Command, is becoming a common perception. Relations in Cameron’s final months before the election become strained and ragged within the Whitehall national security community. Suddenly, he is in everyone’s sights. Service chiefs and officials turn on him for preventing the National Security Council (NSC) co-ordinating foreign, defence and security policy as they would like. Some say he lacks the strategic grasp of Clegg or Osborne, and lacks a vision of Britain’s place in the world of a Thatcher or Blair. He is criticised for making hasty rather than considered judgements. He is accused of not trusting his advisers and officials at large beyond his close circle and his Number 10 team. He is said to begin NSC meetings by asserting ‘this is an important issue and you know what I think, but nevertheless let’s go through the arguments’, thereby discouraging others from speaking up. His team are nonplussed by the accusations: ‘Yes he has strong views, but if he didn’t, he would be criticised for being indecisive.’ The Foreign Office is no longer as assertive as it was in the early years of the coalition. Whereas initially Cameron’s appointment of Hague, and the latitude he gave him, restored some pride and authority to the Foreign Office lost in previous years, there is a widespread view that its influence diminishes towards the end of the Hague era. By late 2014, almost every aspect of Cameron’s effort on foreign affairs is under attack. How much justice is there in the criticisms?
His lead on Libya in 2011, lauded at the time in many quarters, is accused of failing to anticipate the destabilisation of the country by Islamic extremists. ‘We had no security presence on the ground, a huge failure, and no coherent drive from the centre to stabilise the country,’ says one retired official. Ed Miliband joins in the criticism during the election campaign, alleging that Cameron’s failures in Libya after 2011 have contributed to the refugee crisis in the Mediterranean.20 Though Miliband’s attack is criticised for its opportunistic timing, his argument strikes a chord. Cameron is accused of naivety and romanticism in his response to the Arab Spring in general, and failing to recognise fully the unsavoury elements amongst those protesting against the status quo. Libya certainly became a failed state after 2011, and it remains an open question whether his intervention in 2011 made matters worse. Would staying out, as in Syria where Assad remained, have been better? Certainly, no lasting peace has been established, but he may have prevented mass bloodshed on the streets of Benghazi in 2011. After the trauma of Iraq, however, no voice on the NSC was recommending putting British boots on the ground. Equally, any attempt to bring in UN peacekeepers would have been vetoed by Russia, given Putin’s strong antipathy to Anglo-French action in Libya. Effort was expended to try to help a transitional government take root, to no avail. If post-2011 Libya is chalked up as a failure for Cameron, it is not for want of his trying to find a humane way forward.
On Russia, Cameron is criticised for not gaining more leverage from the relationship he built up with Putin from 2011 to 2013, which might have deterred the Russian leader’s aggression in Ukraine. He is criticised for snubbing Putin at the Sochi games in February 2014, and for not being a direct part of the German-led talks on Ukraine. ‘We should be in there,’ say diplomats: ‘he took his eye off the ball.’ During the D-Day seventieth-anniversary celebrations in Normandy in June 2014, Merkel invited Hollande to join her for conversations with Ukraine’s president, Petro Poroshenko. Obama tells Cameron: ‘I don’t think I want to be part of this,’ and Cameron agrees to stay out too. Cameron’s advisers believe they do not need to be directly involved, and have great faith in Merkel to lead the discussions and to keep them regularly informed. Criticism of torpor over Ukraine discards the strong stance that Cameron made at EU Council meetings and the NATO summit on sanctions against Russia. Cameron describes Britain’s role as being ‘the strongest pole in the tent’, pressing for sanctions in the first place, keeping the US and EU aligned over them, and ensuring they remain in place when others waver.
On China, Cameron is attacked for needlessly provoking the country at a time of leadership transition when, with hindsight, it is said that Clegg could have met the Dalai Lama. As a consequence, he ran a serious risk of damaging Britain’s relations with China, before eventually handing the Chinese a major moral victory, as incoming world leaders are now much mo
re reticent to meet the Dalai Lama. This criticism has substance, if underplaying the importance Cameron and Osborne gave to repairing the economic relationship.
On his relationship with the US, Cameron’s desire to avoid the overfamiliarity of Blair, and the perceived neediness of Brown, produces a relationship arguably too detached, with insufficient work put in to build up links between the teams below the leaders themselves, such as those between the Defence and Foreign Secretaries and their American counterparts (with the exception of Hague’s close relationship with Hillary Clinton). But Obama nevertheless thinks Cameron his closest overseas ally during 2010–15; the relationship may not be as close as Thatcher–Reagan or Blair–Clinton/George W. Bush, but it establishes equilibrium and serves British interests well. Cameron deserves credit for establishing this bond with the president, even if Whitehall could have been more adept at building close relations with Obama’s team, for all their very different outlooks and views of Britain from their opposite numbers under Clinton and George W. Bush, particularly after the departure of the sympathetic Thomas Donilon, Obama’s National Security Advisor, in June 2013. The US certainly wanted Britain to do more in Iraq, but the two pillars on which its own policy was based proved misjudged: faith in the Baghdad government, whose leadership under prime minister Nouri al-Maliki proved unsatisfactory, and faith in the Iraqi army.
On the EU, he is criticised for being overly concerned by his own right wing, which led him in Opposition to pull out of the centre-right EPP grouping in the European Parliament, creating difficulties with Merkel. Merkel liked Cameron personally, and they reached a mutual understanding of their different approaches to the EU. But it took time after 2010 for her to see him as a serious political player. It is hard to discern a clear strategy or forethought on Europe, or to see more than a series of tactical withdrawals and pyrrhic victories, until 2013, with the EU budget cut and the announcement of the referendum. He is criticised too for not doing more to build coalitions of support, which are vital in the EU. Cameron’s freedom of manoeuvre over Europe nevertheless is severely limited by his uncompromising Eurosceptic backbenchers, who have inflicted considerable damage on the four previous Conservative leaders, and who harbour a deep hatred towards him personally. Equally, he can when the occasion demands build support in Europe, or over Libya in 2011, the European budget in 2013 and Ukraine in 2014–15. But his record on the EU at best is mixed.
While there is some justice in these criticisms, cumulatively they take little account of the difficulty that any leader would face in trying to find consistency in the anarchic world of these five years, with the rise of Islamic extremism, a prolonged economic crisis in Europe, and a reticent US president. Cameron is vulnerable to attack on his foreign and defence policy mostly from the autumn of 2014 onwards when he allows himself to be overly focused on the general election. ‘There are no votes in defence or foreign policy’ may have been an article of faith with him and his team. But he allowed himself to be too swayed by Osborne who will not commit to 2% on defence before the election, and Crosby who will not relax his tub-thumping insistence on the long-term economic plan. Game, set and match to the long-term economic plan, but it comes at a price.
Cameron’s foreign and defence policy achievements are not empty. He has partial success in achieving his three objectives in foreign policy: to safeguard the British nation; exploit opportunities for selling British products abroad; and to provide a moral lead and practical help on the world stage. He shows judgement and resolve in getting Britain out of Afghanistan in 2014, stoking up anger among elements of the military for doing so. His decision to stick by the development pledge helps save lives and gives Britain moral authority at the UN. His standing up to what he sees as the bloated defence community may, if the 2015 SDSR is well conceived, prove politically to be on a par with Thatcher confronting her antagonists who had vested interests in maintaining the status quo – the professions and trade unions. Aside from questions over Libya in 2011, and his lack of groundwork before the Syria vote, he avoids major blunders in foreign policy, keeps the country safe, and harbours hopes that his non-doctrinaire approach to the EU, coupled with his strong relationship with Merkel, might yet achieve a new settlement between Britain and Europe – something that eluded all his predecessors since the 1970s.
THIRTY-NINE
The Coalition Endures
November 2014–March 2015
‘Why do we need to have a Budget at all? Why would I give that to you?’ says Clegg angrily to his Conservative colleagues. He is adamant in the weeks before Christmas that Osborne will not have his final showcase. The Lib Dems are thoroughly disillusioned with the big fiscal events of Autumn Statements and Budgets, sick of seeing the Conservatives take the credit when they go well while the Lib Dems are marginalised. ‘They should have come to the realisation about Budgets earlier, frankly,’ says Rupert Harrison. ‘But they’ve finally realised they’d never got anything good out of them. It’s George standing in front of Number 11, and it’s basically seen as George’s event.’1 Privately, Osborne thinks it is very stupid of them to let him have this Budget. David Laws, an increasingly strident figure for the Lib Dems, says that if there is to be a fiscal statement, it must be on a ‘care and maintenance’ basis only (i.e. addressing matters that need annual attention), with no crowd-pleasing political content. Clegg is refusing to budge.
But Osborne needs his spring Budget – for the Conservative Party, with the election coming up; for himself; and, so he says, for the country. His acrimonious dispute with Clegg over Northern Powerhouse has badly soured their personal relationship since the summer. Osborne has always seen Clegg as naive but is now beginning to see him as a loser. Osborne, more than anyone in the government, calls such shots in these final months before the election.
The Budget is the most difficult of the three major arguments between the coalition partners in the final nine months, the other two being the Data Retention and Investigatory Powers Act of July 2014 and the Counter-Terrorism and Security Act of February 2015. Some differences had come over the Autumn Statement in December and the NHS winter crisis: but a way through these had been negotiated relatively easily. To officials trying to hold the government together, the greatest worries come from increasing differentiation, with the Lib Dems needing to be seen to offer alternative policies as the election approaches; squabbles over who would claim credit for initiatives; and leaking, which first manifested itself after the boundary changes dispute, and which becomes considerably worse in the final months. Up to that point, the government has been less prone to leaking than many of its single-party predecessors. By the autumn of 2014, Lib Dems are sick of being pushed around and used as fodder for Conservative policies, and demand more say; the Conservatives are equally angry at the Lib Dems portraying themselves in the media as humanising the mean-spirited, nasty Tories.
Yet despite all this, Osborne gets his spring Budget, and a full-on one too. How has he managed to convince the Lib Dems to let him go ahead? Deception plays a part. He convinces the Lib Dems that an annual spring Budget is a necessity for reasons of income and corporation tax, and other necessary financial provisions. Osborne’s team meticulously assemble the technical and legal arguments, such as the Office for Budget Responsibility’s obligation to produce reports, which point to the Budget being inescapable. ‘Surely it can be delayed?’ the Lib Dems pertinently ask. ‘No, it can’t,’ they are told blankly. In fact, as Osborne knows all along, the Budget could very well have been postponed until after the general election.
Over a series of Quads in the early weeks of 2015 Osborne sets to work battering away at remaining Lib Dem reservations, offering them what one Number 10 insider describes as ‘a succession of goodies that he had for months squirrelled away under the table’. ‘Let’s start on the things we can agree on,’ he says to Clegg and Danny Alexander, ‘and let’s see what comes out of these discussions and whether we can find things for you.’ Further increases in the perso
nal allowance (this time from £10,600 to £11,000 by 2017/18) are indispensable parts of coalition Budgets, with both parties, as ever, claiming the credit. To soothe Danny Alexander’s and Scottish Lib Dems’ concerns over North Sea oil taking a battering from reduced oil prices, Osborne agrees to a cut in petroleum revenue tax from 50% to 35%, and a range of further measures to support the struggling industry. He then agrees to the idea of Steve Webb, the Lib Dem pensions minister, to allow people to sell their annuities. To placate Lib Dem worries about banks and multinationals moving profits offshore, Osborne assents to further restructure measures, and agrees to raise the bank levy. Finally, to meet the concerns of Clegg over mental health provision, he agrees that mental health services in England will receive £1.25 billion in extra funding during the next parliament. ‘If you want me to do all this, fine, but we will have to have a Budget,’ he tells them, like a clever schoolboy who knows he has just pulled off a cunning wheeze.
Thus Osborne scales the first of his challenges over his final Budget: securing Lib Dem agreement for it to go ahead. He then meets Cameron and Lynton Crosby to ask whether they feel an attention-grabbing policy is needed, but they agree that any such rabbit might distract the party from Crosby’s relentless themes of the long-term economic plan and Ed Miliband’s weaknesses as party leader. ‘All very fascinating,’ says Crosby drolly at a meeting of Cameron’s team, listening to a succession of economic ideas to scintillate the public, ‘but voters only need to know two things about the economy: one, it was broken five years ago by the other lot; second, it’s OK now under us.’2 Osborne’s wish to make a splash on savings and pensions reform is thus roundly vetoed.
Cameron at 10 Page 55