|
Last Updated: Nov 2nd, 2009 - 17:32:57 |
LONDON (Reuters) - With Labour facing a humiliating rout in Thursday's local elections, Prime Minister Gordon Brown looks sure to reshuffle his cabinet and Chancellor Alistair Darling could be the most high-profile victim, several political analysts say.
Some aides have been urging Brown to put schools minister and close ally Ed Balls into the Treasury for a while, arguing it would bring more discipline to the ministry and give Labour a fighting chance of winning a general election due by next year.
Such a move also risks making economic policy more left-leaning if Balls is keen to burnish his credentials as a future Labour leader with the party's traditional support base.
"He (Brown) would be mad not to put Ed in now," said one source close to the prime minister.
Other advisers, however, are concerned that sacking a chancellor sends the wrong signal to markets at a critical time and would look like Darling was being set up as a fall guy after having to deal with the banking crisis and the recession.
The economy is set to shrink at its fastest pace since World War Two this year and public borrowing has hit a record high as the government has had to shell out billions of pounds to bail out the banking sector.
Analysts say Darling has done the best he could under the circumstances. But his position has been undermined by the ongoing scandal over MPs' expenses.
On Monday, he was forced to deny a report in the Daily Telegraph that he had claimed for a service charge on a London flat he let to tenants while also claiming living expenses for another home provided free by the government.
Brown rallied behind him. "Alistair Darling is a very good chancellor and he's been a very good colleague and friend," he said on BBC Radio. "I don't think there is substance in these allegations."
Markets would likely take Balls being moved to the Treasury in their stride. He is well known in financial circles as a former Treasury minister and as Brown's right-hand man when he himself was Chancellor for a decade.
He also has close ties with White House senior economic adviser Larry Summers, whom he studied under at Harvard, and with U.S. Treasury Secretary Timothy Geithner, which would stand him in good stead with London currently holding the G20 presidency.
But Treasury officials are concerned that Balls as Chancellor would lead to a flurry of initiatives designed to garner media headlines. Many have been impressed by Darling's calm and steady approach.
Darling, 55, is also less likely to take risks than Balls, 42, part of a younger generation of ministers who will probably fight to replace Brown at some stage.
"I'm not going to say that I don't want to be leader of the Labour Party, that would be a silly thing to say," Balls said in an interview in March.
"Would I like to be chancellor at some point in the future? Of course I would. I'd love it," he told the New Statesman magazine then.
Top of Page
Post an instant comment or a suggestion to the above article or news
Note: You can use the above link to form a new discussion forum, place your opinion and discuss events, politics, articles, environment, fashion, health, internet, search engines, marketing, movies, music, religion and any other topic.
Submit Articles
Author Login
