Theresa May: suddenly there is a money tree

Gifts for the NHS

Theresa May’s narrow victory in the Commons is hardly a vote of confidence in her government, reckons Paul Demarty

It seems like Theresa May is trying very hard to look as though she is full of ideas.

In particular, she wants people to watch very closely, as she says nice things about the national health service. On June 18 we were treated to no end of guff about how great it is; about - cue patriotic string swells - the courage of NHS staff after the Manchester terror attacks; and about - cue melancholy piano chords - the PM’s own struggles with diabetes. Perhaps we are the only ones whose emotions are rather dulled by the way all such stories are told twice: once at the press conference, and once in all the promotional puffery that precedes it.

All of this was in aid of the big announcement that NHS funding was to rise 3% a year above inflation. Oh happy day! What a sudden and unexpected announcement from the government, whose health secretary can barely conceal his hatred of the institution he patiently asset-strips, and whose chancellor is hardly noted for great feats of largesse towards the likes of us.

Fortunately, as readers might have heard, we are leaving the European Union. Brexit means Brexit - whatever that means. And you will remember the present foreign secretary’s promise that we would have £350 million spare to spend on the NHS after the ties were finally severed. So May promises us: this big pile of funding she has found down the back of the sofa for the NHS is the ‘Brexit dividend’.


There are many sceptical voices raised as to the precise existential status of this ‘dividend’, and its status as one of recent history’s most flagrantly manufactured numbers was already assured, along with Donald Trump’s fortune. Squeaking as loud as he can to get some attention is the Liberal Democrats’ Brexit spokesman, called - no word of a lie - Tom Brake, who wants to get the office of national statistics to adjudicate on whether this figure bears any trace of reality. We suspect Mr Brake knows as well as we do that the ONS will be unable to settle a matter of totemic importance to head-bangers on both sides of the Brexit dispute.

A further chill was cast on all this by the appearance of a grim-faced Philip Hammond at the following morning’s cabinet meeting, telling all assembled (according to TheTimes) that there was now officially no more money for anything else. Spreadsheet Phil’s revenge, as ever, comes in the most delightfully bureaucratic forms.

We must surely join in with ‘remoaner’ scepticism as to this ‘Brexit dividend’ - it seems that, having been plucked out of the air by culpably dishonest ‘leavers’ in the run-up to the referendum, it is now yet another alias for the magic money tree that May claimed did not exist, but which she shakes every time she gets into political trouble. (At least there are wider social benefits to tossing money at the NHS, as opposed to bribing the Democratic Unionist Party into propping up her ailing political career.)

The essential lie of Johnson’s £350 million, and all other variants, is that it takes hold of the UK contribution to the EU budget without considering the revenue Britain receives from the EU. This country is a net contributor, of course, but there is further the matter of the benefits Britain’s service sector accrues from access to the single market, a slice of which turns up in the treasury as income tax. In other words, it is as if you had gotten a £350 million return on some investment, but that it was taxed at a rate of 150%.

Of course, Hammond’s ‘treasury view’ is so much hogwash as well. If vast swathes of England are hit by flash floods, are we really to expect that he is powerless to make funds available? This is not a matter of accounting, but of politics.

The politics is, in the first instance, a matter of the Tories’ total dysfunction over Brexit. Having narrowly avoided, last week, a Commons defeat by promising contradictory things to the rival camps on her benches, May is now in the same impossible situation today. Her smart-Alec move to offer parliament the vague impression of a say in the final deal has kept the wolves at bay for the moment. She narrowly won the ‘crunch’ Commons vote 319:303 on June 20. The would-be leader of the Tory rebels, the urbane Dominic Grieve, proved to be a total pushover. Only six Tories voted against the government: Ken Clarke, Anna Soubry, Sarah Wollaston, Heidi Allen, Antoinette Sandbach and Phillip Lee. Meanwhile, four Labour MPs actually backed the government: the odious Frank Field, Kate Hoey, Graham Stringer, and John Mann. Six other Labour Brexiteers abstained, as did Kelvin Hopkins, who sits as an independent now after having had the whip withdrawn.

But despite the 16 majority this will be just a short reprieve. She must promise a good deal to the ‘remainers’ and a good fight to the Brexiteers. Whenever she mollifies both, it is by means of political fantasy, and immediately rejected by the EU negotiating team.

This, then, is the important context for this NHS announcement. If May actually cared about the NHS, she would find extra investment for social care too, and Jeremy Hunt would be chopped up in bags in her freezer. This is election talk. May is making contingency plans for an outcome that looks increasingly likely - her government collapsing about her head.

A Corbyn government?

John McDonnell got a bit of a coating in the press last time he quoted Mao, but he and Jeremy could be forgiven for looking at all the great chaos under heaven, and thinking the situation excellent. May clearly has an eye on fighting an election soon, but it will hardly be at a time of her own choosing. It will be plain what is really going on - the disintegration of a fragile coalition between the Tories, the Democratic Unionists, and the other Tories.

That hardly guarantees Labour’s victory. Opinion polls have the Tories leading by three to five points just now and, while Labour overturned much worse odds last year (in reality, an achievement of Corbyn and his personal machine, in the face of Pétainesque levels of defeatism and sabotage on the Labour right), we should not be certain of a repeat performance: at the very least, he has lost the element of surprise.

It would be equally foolish to rule out a Labour victory, and there are worries on that side of the equation too. Too often, we observe among comrades an almost touching faith in the procession of the British state through the serene air of liberal-democratic normality. Little matters such as the appointment of governments being a matter not for parliament, but the queen, seem to disappear from their thoughts altogether. If Jeremy Corbyn leads Labour to victory, then he becomes prime minister - right? Surely, they wouldn’t dare to stop him - not unless there was a seriously acute political crisis ...

In truth, Brexit is not the scariest thing facing the British establishment. That would be the bearded chap on the left in the vest, who is so very much against ‘austerity’ (or socialism for the rich, as it has turned out to be), and is so very unreliable when it comes to our alliance with America, which is surely the last possible thing that can save us from the madness of leaving the EU. The one thing Financial Times leader-writers agree with Jacob Rees-Mogg on is that the latter is a less alarming proposition as prime minister than Jeremy Corbyn. The incentive to coerce together a national government is certainly there, and it can be done - the constitution is carefully designed as such.

As to whether exceptional constitutional (or even extra-constitutional) measures will actually be taken - who knows? We know they have been, in Italy and Greece, to parachute Mario Monti and Lucas Papademos respectively into the top jobs. We know that the Labour Party has been successfully split this way before, in 1931, taking the good ‘patriots’ into a national government. The danger of ignoring such possibilities - surely more probable than at any point in the last four decades- is that we prepare people for a victory parade, and hurl them instead into a vicious struggle. That story does not end well.