Political Consequences and Future Leadership

This is the Guardian. Hello, this is Kirn Stacy We had some big breaking news today because the Defense Secretary John Healley announced his resignation from Kir Starmer's cabinet I spoke to Noshin Ikbalf for today and focused the latest and that is what you're going to hear now The fact of the resignation is one thing But the actual wording of the statement is so blistering He said, you are not as committed as you claim and you'll actually ting our security at risk. Not only is he saying that Kist A arm' is not willing to do it, but he's unable. overrule his chancellor. So he's saying he's also weak. All of these things into all of the doubts that Kiss ar' critics have about it. From the Guardians Today in Focus, this is the latest with me, Noti Niic Bal. Here in Stacey, you're the Guardians Policy editor and I don't want to make too many assumptions about our audience. but I think when a lot of people see the headline John Heeny resigns But this is a very big deal. Why Well, first of all, John Heillley was until about an hour ago, the defefense Secretary. That's a pretty big job in itself. big job It's true to say that he's probably one of the more low key members of the cabinet. I've actually known him for quite a long time and he's very softly spoken, but he he's well liked. He's been around the Labour Party for an extremely long time. He's got a history in the treasury He's done senior jobs at a number of posts. But why is this a big deal? Because the fight that the government is having right now is over defense spending. And we are told, although this has been happening behind closed doors until today, that the treasury had been saying that they were willing to fund a certain amount for the defense budget over the next few years, and that John Healy the defeense secretary pushing back very heavily and saying no, we need much more The problem is you've got Kirst Amer saying that defence of this country and also geopolitical uncertainty and instability is the major force in the world right now, the one political issue we need to deal with. and not only have you just had his Defense Secretaryigned said, you're not going to spend enough on defence. But if you look at the statement that he's put out, it is really damaging for the Prime Minister and probably for the party as a whole. Can you tell me more about the statement? because how big is the shortfall in the first instance between what Hilly was asking for and what the government was able to negotiate? We think the military chiefs had said, we think this requires another twenty billion pounds on top of what's already been promised. I mean, they're always going to go in the top end. It' going high It's what the military chies do They were saying twenty eight billion pounds over the next four years. That got moderated. We're told to a request for eighteen billion pounds What sources are now saying today is that the treasury came back with their final offer on Monday afternoon And they said something in the realm of fourteen or fifteen billion pounds Only ten billion pounds of which was new money And that seems to have been very important. And a lot of it was backdated. So it was due to come in towards the end of the four year period. And what John Heelley has said is the gap between what we wanted and what you're offering is one of whether our country is safe or not And that is such a huge accusation to make against the Prime Minister And then what does that then mean for national security? If there is that big gap and if your Secretary of State of Defense is resigning over the issue? It's difficult to know. If you listen to treasury people, they will say, Well, look, the problem you've got is the Ministry of Defense, as you say, Nosashine, always asks for too much N one and number two always mismanages its projects. very famous example of this, the Ajax tank program, tanks that basically didn't work and huge bills as the Ministry of Defense tried to build them Treasury always says well, look, you don't run these programms very well. You ask for a lot of money, try and build very big, very sophisticated pieces of kit. They're often out of date by the time you get them. The Ministry of Defense, what they would say is we are living at a time of real instability. John Healley talks a lot about the threat, not only about what's going on in the Gulf, but also particularly about the threat from Russia. He has talked in the past, he's given whole press conferences about about the fact that Russian submarines have spying, he says on our communications equipment at the seabed, you know around the top of the North Sea, and that we need equipment to be able to deal with that There are two or three really big projects that are in question here. One is called GCAP, which is aject Silly name really, but it's actually just fighter planes. Right. And we were supposed to be building a whole new fleet of fighter planes The Treasury said in the end, we're happy to do that, but we actually want to take charge of the program, not you, because you miss spend this money. Okay. Another big program that's in question here is called OrCS. and this is big deal not only for deffence, but also geopolitics. This is a partnership between the US, UK and Australia. to design a new fleet of nuclear submarines. It's going to incorporate technologies from all three of those countries and the UK and Australia are supposed to buy these submarines at the end. Now this was going to provide a major boost to the UK. not just in terms of defense, but also in terms of growth. It's going to boost the industrial base create jobs. And the Prime Misters talked in glowing terms about this project, not least because the Americans and the Brits actually stole that contract away at the last minute from the French. So that's been put at risk. And then you've got other things going on in the world, which Kirstar has also made commitments on, whether that is to be part of the coalition of the Wing, the forces that might get deployed in Ukraine, should there be peace there orr the Prime Ministers also promised to take part in any kind of peacekeeping force in the Straits of Hmz, should that conflict end Defense sources will tell you that since the budget of last November, the Prime Minister has made a series of commitments on the world stage, but is now not willing to back that up with hard cash I guess you don't need to be a defense expert to know that defense and national security is very high on the agenda right now for most countries And so given that and given this resignation damaging is it for the Prime Mis Eormously damaging. The fact of the resignation is one thing But the actual wording of the statement is so blistering that it removes one central plank Kirst Aarm's entire argument for why he should remain in position. Wow Kir Starmer will go around, if asked about his premiership and say the world is a very uncertain place. I have proved myself on the world stage. I've proved that I can do the diplomacy and I'm committed to our defence. This is not the time to start shaking things up. His defense secretary has just resigned, saying, you are not as committed to defence as you claim and you're actually putting our security at risk because you're not willing to commit the money that we need. So he really put the boot in. He really put the boot in and then J just for an added kind of double whammy here, he said the wording of this is quite interesting. He said the treasury has been unwilling and you have been unable to provide the funds needed. Now what that's saying is not only that Yeah, not only is he saying that Kist Aamm is not willing to do, but he's unable to overrule his chancellor. So he's saying he's also weak So you've got weakness, indecision a lack of commitment to the nation's security, all of these things play into all of the doubts that Kiz Aamma's critics have about him You know People are now saying Ironically that the Makerfield by election might actually be giving Kir Stammer more time in post. I mean, maybe only a week. This is the kind of thing that brings prime mininisters down But were he to go, there's no easy fixes to this. I mean, could anyone sort of bridge this gap between The military wants, what the Defense Secretary says is needed, and what the treasury is willing to give up. Frankly, nobody has said so in open terms closest we've got for an explanation as to how you can bridge this gap. is something that Andy Burnham used to say But a since you turned off which was you can borrow more, you can issue specific bonds to pay for defence. This is something Germany has been doing recently In recent weeks, Andy Benhams or at least Andy Benham's allies have clarified that no he doesn't intend to do that and he would stick to the fiscal rules as already set out by this government and not borrow any more than they allow. That boxes him in to a certain extent The reality is he would have been boxed in anyway, because it's not actually the fiscal rules him the chancellor in. it's how much we are paying on our interest rates when the government borrows money.ight. And it's the markets who tell you how much you can borrow, not your own made up rules. Your own made up rules are there to reassure the market. But essentially, if when you're going out to the market to borrow money They're saying, okay, but you've got to pay five, six percent interest rates. I mean, that's not what the government's paying. But you know, if they're saying, you have to pay high interest rates Then you're hampered. You know, you simply can't afford to do that that is what Andy Beram would have found anyway That's why we've started he murmoring of maybe the answer to this is to tax people Baking the mananifesto pledges. Well, look, there are elements of tax that you can raise without breaking the manifesto pledges. The manifesto pledges were not to raise national insurance, not to raise income tax and not to raise VAT You could go for capital gains tax, you could find other things to tax They might not raise as much U I suspect if you're Andie Burnham or at least somebody who's doing policy for him At the moment, you're looking at exactly those options right now And in the meantime, Kein, where does this leave John Healley, who appears to have made a very principled resignation? What's his game Well, that's a good question.'s what a lot of people are asking. Why wasign now? I mean honestly This is a genuine dispute I wrote a pce a couple of days ago for the Guardian saying that this has caused the biggest rifting cabinet since Labour has been in power. and the briefings I was getting from treasury from numberum ten and from the MOD were really vitriolic. You know peopleeople being very scathing about each other and the way that they've handled themselves during this essentially year long bates within government. So that rancor does exist and I think John Nahilly is resigning because he genuinely feels quite strongly about this. I think you could ask whether he would have done this if the Prime Minister of the day was in a slightly stronger position. I think that's Qestionable if there was a different prrime minister in Post who didn't look like their days were numbered, would he be resigning in this way There will be people who say he sees that Andy Burnham is coming in. Aually it's better to get off this ship before it sinks. Right and see what happens after if Andy Burnham becomes Prime Minister There are people who think that John Heley himself has been positioning himself as a potential leadership candidate. Right. So for all the people who asking, who is he, potentially he can putting himself in the ring. There was a theory a few months ago that Keirststam would have to stand aside because of all the problems thatff have affected his government And that in the interim before Andy Burnham finds a seat or whatever happens, You needed a steady as she goes type minister to take the reins John Hilly being a classic example, right safe pair of hands. Now that Onie Burnam has found a seaton if he wins, he'll be back in Westminster soon that theory of the case seems to be somewhat undermined. I don't quite see what the theory is for John Heley as a relatively low key albeit capable minister to take over at this point when you've got Someone like Andy Berham who has a higher profile, more charisma is more popular with public Um You never know. He might have a go He might just be positioning himself for whatever comes in the future. But I would say, you know, to take the cynical hat off for a second, this is a genuine dispute and I think he genuinely does feel quite strongly about it Keeping an eye him nonheless. Karen, thank you so much for your time. Thank you That's it for today. My huge thanks again to Kirn Stacey, the Guardiian' Policy editor and host of our Sister podcast Politics Weekly. Thanks for listening to this episode of the latest. Today in focus, we' be back with you as usual tomorrow morning and the latest will be back tomorrow night. This episode was presented by me, Nashin Nick Bal. The producer was Jacob Liebenberg, the senior producer is Ryan Ram Gobvin the lead producer is Zoe Hitch This is the Guardian