17 October 2017

In praise of Philip Hammond

By

Last week was an eventful one for the Chancellor of the Exchequer, a man whose ability to infuriate both the Brexiteer and Remainer wings of his party at the same time is fast eroding his reputation for tediousness.

Though the attacks on Philip Hammond are coming from all sides, it is the verbal projectiles from Brexit’s true believers that are delivered with particular venom. To make matters worse, he now has the full support of Lord Heseltine. As sure a sign as any that he is clinging on to his job by his fingertips.

And yet, Philip Hammond understands the Government’s job better than anyone in the cabinet. Sacking him wouldn’t just be bad for Britain; it’d be bad for Brexit. And I say that as someone who is glad Britain is leaving the European Union.

The latest round of Hammond’s tribulations began on Wednesday. In a piece for The Times, the Chancellor claimed that “the Government and the Treasury are prepared. We are planning for every outcome and we will find any necessary funding and we will only spend it when it’s responsible to do so.”

Later that morning, in an appearance before the Treasury Select Committee, Hammond reiterated that the Treasury would stump up for a hard Brexit as and when that was necessary. Intellectually, this is a perfectly reasonable tightrope to walk. Why waste money on something you don’t think is going to happen?

But in today’s highly flammable politics, his argument – and the inclusion of an admission that “it is theoretically conceivable that in a no deal scenario there will be no air traffic moving between the UK and the European Union on 29th March, 2019” – was explosive. Time for Hammond to go, came the cry from the Brexiteers. The Daily Mail, which remains fiercely loyal to Theresa May, wrote in an editorial that: “At this crucial juncture in our history, we need a Government with vision and purpose — not half-hearted, lugubrious appeasers like Mr Hammond.”

Then, on Thursday, came an infuriating, unforced error when Hammond described the EU27 as “the enemy”, an unhelpful mistake for which he apologised immediately. (Incidentally, it was just the sort of blunder that Boris Johnson makes on a weekly basis. Yet the gun-slinging Foreign Secretary is held up as an authentic political genius.)

By Sunday, the Chancellor was surrounded, with two senior Remain-supporting cabinet ministers backing his departure, one of them describing Hammond to The Sunday Times as “an inept political operator in a crowded field”. Yesterday, a second of the Chancellor’s SpAds walked out, and today he declined to answer any questions at a joint press conference with the head of the OECD. The middle ground is a lonely place to be in British politics.

Perhaps the most frustrating thing about the criticisms of Hammond is that, even on their own terms, they make no sense. The Chancellor is endlessly accused of pessimism. But it was his optimism about the chances of striking a deal with the EU that so enraged so many last week. His opinion that a no-deal scenario was so unlikely that he didn’t want to waste money planning for it prompted the Daily Mail, in the same editorial that called for his sacking, to describe him as “dismal, defeatist, relentlessly negative”.

Why are his critics’ attacks so incoherent? The answer is simple: they are wrong and Hammond is right. Not right because we are all doomed because of Brexit. Not right because he wants Brexit to fail. But right because he realises it’s complicated. There will be plenty of opportunities for Britain once we leave the European Union but untangling ourselves is a thorny process involving a high degree of uncertainty. It is upt to the Government to manage that uncertainty.

As Hammond has pointed out, with every day that passes without a transitional deal being agreed, the value of that deal decreases. Which is why striking one is so important. That is not a value judgement on Brexit. It is an undeniable fact.

Hammond faced the same accusations of pessimism last year when he squirrelled away £26 billion in a Brexit war chest to be used to smooth the Brexit process as and when that was necessary. Events have already vindicated that decision, with two-thirds of those funds already lost, thanks to a downgrade of the OBR’s growth forecasts.

In other words, Hammond is being attacked for doing his job. He is not the first Chancellor to face accusations from his own side that his tightfistedness is all that stands between the country and the sunlit uplands. And he will not be the last.

In that sense, Hammond’s unpopularity is unsurprising. What is truly mystifying, however, is the way in which, in the eyes of so many Brexiteers, his villain status is up there with the most fervent Europhiles, as though his devotion to the European project is on a par with Nick Clegg’s. To anything Hammond utters that isn’t tub-thumpingly optimistic the response comes back: well, he would say that wouldn’t he.

Not so long ago, however, Hammond was one of them. Cameron’s appointment of him as Foreign Secretary in 2014, was thought to be highly irresponsible. How were our European allies supposed to work with him, given his swivel-eyed views on Europe?

But, as Chancellor, what Hammond understands – and so many Brexiteers miss – is that Brexit is not happening in a vacuum. The more uncompromising leavers like to claim that their opponents are questioning the will of the people or continuing Project Fear. But in their black-and-white treatment of Philip Hammond, who sees the shades of grey that Brexit entails, they are the ones refighting yesterday’s battles.

What too many of them forget is that this Government has two equally important jobs: to deliver Brexit and keep Jeremy Corbyn out of office. The two cannot be seen in isolation and getting either wrong would be disastrous (though the latter more so than the former).

Hammond knows that the way to navigate these choppy waters is to provide certainty and stability throughout the Brexit process and deliver a bold domestic agenda. For the Conservatives to lose their monopoly on competence while the Labour Party has a monopoly on compassion would deliver Downing Street to Corbyn. But so would inaction on the domestic issues – housing and productivity foremost among them – upon which Corbyn is capitalising. That’s precisely why, as The Sunday Times reported, Hammond hopes to deliver a bold slate of policies in next month’s budget.

Theresa May is good at diagnosing Britain’s problems but her solutions always fall hopelessly short. Hammond, by contrast, is showing a willingness to slay some sacred cows: for example, by building on the green belt to tackle the housing crisis. Such bravery should be rewarded, not punished.

Hammond certainly has a unique – and for a politician, rather unhelpful – talent for being correct about so much while being disliked by so many for such different reasons. But a Prime Minister in control would protect him, not hang him out to dry.

Oliver Wiseman is Deputy Editor of CapX