Andrew Grice: George Osborne the octopus pulls the PM into troubled waters

Inside Westminster

More chairs! We need more chairs!" The cry went up in 10 Downing Street as the new Cabinet prepared to meet on Wednesday. The number of full cabinet members and other ministers "allowed to attend" had risen from 29 to 32 after the demoted Kenneth Clarke and Baroness Warsi were compensated with second-division status. It was a struggle to squeeze them all round the coffin-shaped table.

The final seat in this game of musical chairs went to the returning Liberal Democrat David Laws. He was not "allowed to attend" Cabinet when his post as an Education minister was announced on Tuesday but, after some last-minute arm-twisting by Nick Clegg, was let in by the time the Cabinet met.

Labour was wrong to dismiss the new line-up as "no change". Mr Cameron showed a ruthless streak that many Conservative MPs believed he did not possess. The atmosphere in some Whitehall departments has already changed after right-wing Tories were installed to change policy (Owen Paterson at Environment, Chris Grayling at Justice) or rein in Liberal Democrats (Michael Fallon to "mind" Vince Cable at Business and John Hayes to squash Ed Davey at Energy and Climate Change).

It was George Osborne's reshuffle as much as Mr Cameron's. The Chancellor was dubbed "the octopus" in Tory circles as his tentacles spread throughout Whitehall. Key allies were promoted, enemies sidelined – notably Justine Greening, pushed out of Transport after 10 months for defending too vigorously the Coalition's policy of opposing a third Heathrow runway. "Her only crime was to stand up to Osborne," one cabinet minister said.

It was, the Liberal Democrats judged, a reshuffle for the Tory party rather than the country. The big question is whether Mr Cameron was merely shoring up his position in his party or will now try to push through traditional Tory policies. Mr Clegg privately views the cabinet shake-up as both a danger and an opportunity. The danger is that the Coalition descends into never-ending rows as the Liberal Democrats veto right-wing proposals, undermining the third party's goal of showing that "coalition works".

The opportunity is that blocking a harsh "true blue" agenda could play well with the voters. But it will be a very difficult balancing act. Mr Osborne's demand for a further £10bn of welfare savings will be the crucial battleground. The Chancellor failed to get Mr Grayling promoted to the top job at the Department for Work and Pensions (DWP) when Iain Duncan Smith refused to move to Justice. Instead, Mr Osborne dispatched Treasury minister Mark Hoban,  to be No 2 at the DWP, another spy in the camp. Mr Duncan Smith will have an important ally in Mr Clegg, who was delighted to see him refuse to budge. Their views on welfare reform are similar. So is their opposition to the Treasury's proposed cuts, which they fear would harm the most vulnerable. In June, Mr Cameron floated controversial proposals, including time-limiting some benefits; scrapping housing benefit for under-25s; curbing handouts for single mothers with three or more children and regional benefit levels. Cameron aides believe welfare cuts are popular and polls do suggest opinion against claimants has hardened in the age of austerity. Although the Coalition will approve some limited welfare savings, Mr Clegg may prove to be Mr Duncan Smith's best friend. The Deputy Prime Minister will tell Mr Cameron to put his hardline proposals in the Tory manifesto for 2015.

Some natural Cameron allies fear that this week's apparent lurch to the right sets him on a dangerous path. He knows elections are won and lost on the centre ground and allies believe that harder-edged policies on welfare, law and order and human rights will boost the Tories' electoral prospects in 2015. But, like Mr Clegg, the PM faces a very difficult balancing act. Some Tory modernisers fear the reshuffle will set back his project to "detoxify" the Conservatives, making it easier for Labour to portray them as the "nasty party". It might be harder for Mr Cameron to appeal to the whole country in 2015 if he does not live up in office to the image he portrayed before the 2010 election – not least on green issues. The new Cabinet is not going to deliver his promise to be "the greenest government ever". Mr Osborne has killed that one. If voters think Mr Cameron's mask has slipped on the environment, they might take the same view on other issues like the NHS. That really would be toxic.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Arts and Entertainment
The Bach Choir has been crowned the inaugural winner of Sky Arts’ show The Great Culture Quiz
arts + ents140-year-old choir declared winner of Sky Arts' 'The Great Culture Quiz'
Life and Style
food + drinkAuthor DBC Pierre presents his guide to the morning after
Life and Style
food + drink
News
i100
Sport
football
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Finance Director

£65000 - £80000 per annum: Recruitment Genius: Finance Director required to jo...

Recruitment Genius: Medico-Legal Assistant

£15000 - £25000 per annum: Recruitment Genius: This is a unique opportunity fo...

Ashdown Group: (PHP / Python) - Global Media firm

£50000 per annum + 26 days holiday,pension: Ashdown Group: A highly successful...

The Jenrick Group: Quality Inspector

£27000 per annum + pension + holidays: The Jenrick Group: A Quality Technician...

Day In a Page

Homeless Veterans appeal: 'You look for someone who's an inspiration and try to be like them'

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Could cannabis oil reverse the effects of cancer?

Could cannabis oil reverse effects of cancer?

As a film following six patients receiving the controversial treatment is released, Kate Hilpern uncovers a very slippery issue
The Interview movie review: You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here

The Interview movie review

You can't see Seth Rogen and James Franco's Kim Jong Un assassination film, but you can read about it here
Serial mania has propelled podcasts into the cultural mainstream

How podcasts became mainstream

People have consumed gripping armchair investigation Serial with a relish typically reserved for box-set binges
Jesus Christ has become an unlikely pin-up for hipster marketing companies

Jesus Christ has become an unlikely pin-up

Kevin Lee Light, aka "Jesus", is the newest client of creative agency Mother while rival agency Anomaly has launched Sexy Jesus, depicting the Messiah in a series of Athena-style poses
Rosetta space mission voted most important scientific breakthrough of 2014

A memorable year for science – if not for mice

The most important scientific breakthroughs of 2014
Christmas cocktails to make you merry: From eggnog to Brown Betty and Rum Bumpo

Christmas cocktails to make you merry

Mulled wine is an essential seasonal treat. But now drinkers are rediscovering other traditional festive tipples. Angela Clutton raises a glass to Christmas cocktails
5 best activity trackers

Fitness technology: 5 best activity trackers

Up the ante in your regimen and change the habits of a lifetime with this wearable tech
Paul Scholes column: It's a little-known fact, but I have played one of the seven dwarves

Paul Scholes column

It's a little-known fact, but I have played one of the seven dwarves
Fifa's travelling circus once again steals limelight from real stars

Fifa's travelling circus once again steals limelight from real stars

Club World Cup kicked into the long grass by the continued farce surrounding Blatter, Garcia, Russia and Qatar
Frank Warren column: 2014 – boxing is back and winning new fans

Frank Warren: Boxing is back and winning new fans

2014 proves it's now one of sport's biggest hitters again
Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas