Ministers yesterday disowned controversial ideas floated by David Cameron's strategy guru, including the scrapping of maternity leave and consumer rights and the closure of jobcentres.
Steve Hilton came under fire after it emerged that he had put forward numerous proposals to boost Britain's fragile recovery. His friends blamed the disclosure on obstructive civil servants who do not admire his free-thinking approach to policy.
The 42-year-old former advertising man, who cycles to work and walks around Downing Street in a T-shirt and socks, is seen as one of Mr Cameron's closest two advisers – the other being the Chancellor, George Osborne. The Prime Minister admires Mr Hilton's original thinking although he often backs Mr Osborne when the two men clash. Insiders say Mr Hilton has a "scattergun" approach to policy ideas, many of which do not get off the ground. The suggestions leaked yesterday look certain to join the list.
Vince Cable, the Liberal Democrat Business Secretary, said: "These proposals are most certainly not government policy. Steve is a fine blue-skies thinker but this is, I'm afraid, not part of what we're going to do."
Naturally, the Opposition seized on Mr Hilton's rather quirky ideas. Yvette Cooper, the shadow Home Secretary, said: "It is hard to imagine anyone who has any idea about working mothers or their importance to the British economy proposing the abolition of maternity leave – unless of course they think mothers shouldn't work at all."
Mr Hilton is said to have clashed with Jeremy Heywood, the permanent secretary at No 10, after proposing that Mr Cameron ignore European Union plans to increase the rights of temporary workers. "Steve asked why the PM had to obey the law," one insider reportedly said. "Jeremy had to explain that if David Cameron breaks the law he could be put in prison."
It is not the first time the pair have crossed swords. Mr Heywood and Sir Gus O'Donnell, the Cabinet Secretary, were not amused when Mr Hilton persuaded Mr Cameron to attack foot-dragging civil servants as the "enemies of enterprise" in a speech to the Conservative Party's spring conference in March. Mr Hilton, who used to work for Maurice Saatchi, is married to Michael Howard's communications chief, Rachel Whetstone. Perhaps his most derided idea came when the Conservatives were still in opposition: he suggested buying cloud-bursting technology to provide Britain with more sunshine.
As the architect of Mr Cameron's flagship "Big Society" theme, Mr Hilton has his own enemies inside the Tory party. Some blamed him for Mr Cameron's failure to win an overall majority at the last election, saying the concept had bombed on the doorstep and that voters did not understand it.
However, some right-wing Tory MPs who viewed Mr Hilton's modernising crusade with suspicion have recently come to regard him more favourably. He is a traditionalist in some key areas, with a strong belief in the family. He has become so frustrated by the way the EU and the European Convention on Human Rights restrict the Government's room for manoeuvre that he is tempted by the idea of withdrawing from the EU, to the delight of Tory Eurosceptics.
Mr Hilton has also impressed Thatcherite MPs by urging Mr Cameron not to water down his reforms to welfare, health and other public services. "If Steve hadn't fought his corner, the NHS reforms would have been dropped completely," one insider said yesterday.
Sources say the restless and impatient Mr Hilton – described by one colleage as "very volatile" – is frustrated by Mr Osborne's caution. The Chancellor has an unwavering eye on the 2015 election, while Mr Hilton believes Mr Cameron may only get one chance to transform Britain and so should push through radical policies on all fronts. Critics say that leads to "mad" ideas like those which surfaced yesterday.
Recently there was speculation that Mr Hilton's frustrations might persuade him to walk out on Mr Cameron. Allies insist the moment has passed and that he is there for the duration.
He's no 'Thick of It' caricature, says Cooper
Some Labour MPs were quick to compare Hilton to The Thick of It character Stewart Pearson, an advertising and brand-management guru who pads around at Tory HQ, spewing out impenetrable "blue-sky" policy plans to the bemusement of ministers. Others said he reminded them of Julius Nicholson, the PM's "Blue skies" Special Adviser, who produces an unending stream of radical and unworkable policy reforms. But Yvette Cooper, the shadow Home Secretary, added: "Steve Hilton isn't a free-thinking academic or a character from The Thick of It pushing zany plans. He was appointed by David Cameron as one of his closest government advisers alongside Andy Coulson. The fact that he supports such a crackers and unfair plan as proposing the abolition of maternity leave says something ominous about this Government and once again about David Cameron's judgement too."
Genius or madman? Hilton's ideas dissected
Plan: Abolition of maternity leave/rights
Crazy? Superficially attractive to bosses who can't be bothered with the pregnancy thing. It would cut business costs and improve profitability. But doesn't the nation need more babies to counter its ageing population?
Plan: Ignore European laws on temporary workers
Crazy? This would push wages lower and make life harder for "British workers" to get jobs. Overall it would boost GDP through lowering costs and prices. Plus if they are only temporary workers they're unlikely to retire in the UK and claim benefits. Good idea.
Plan: Ban government press officers
Crazy? Temporary loss of output but presumably they would be redeployed more productively elsewhere in the economy. If they're lucky; used spin doctors are a difficult market right now.
Plan: Close all jobcentres and fund community groups
Crazy? Probably a bad idea. Anything that brings jobs and the unemployed together is a valuable thing, and ought to pay for itself, long term. But when was the last time a community group launched a successful business?
Plan: Cloud-bursting technology to provide more sunshine
Crazy? Great idea, apart from the unproven technology, unknowable consequences and vast cost.
Plan: Abolish consumer rights
Crazy? Not as mad as it sounds; caveat emptor served us well for centuries. Abolition would, though, increase production of "economic bads" – frauds and swindles that reduce economic well-being.