Shabana Mahmood has already acquitted herself as justice secretary, and proved herself to be the most effective reforming home secretary in years. It is no surprise that the word in the Westminster bubble is that she is “nailed on” for another promotion, this time to the role of chancellor.
Indeed, one of the few substantive arguments against Ms Mahmood succeeding the deeply disappointing Rachel Reeves is that she has at least two significant tasks ahead of her – completing her changes to the asylum and naturalisation system, and reorganising the police forces. Events, however, seem to be overtaking her.
One shibboleth that has been raised needs to be dealt with immediately: that she lacks expertise and experience in economics. It is true that she is a lawyer rather than an economist by trade, and her political activity in the field is limited to a spell as a shadow Treasury minister under Ed Miliband (who, coincidentally, is the man she has now seemingly eclipsed in the scrap to gain control of that same department).
None of that matters. Some of the best chancellors, such as Geoffrey Howe and Kenneth Clarke, have had little or no economic training before taking on the job. What’s more, some of the nominally “best qualified” have proved to be underwhelming. Kwasi Kwarteng was a fine economic historian before his ill-fated mini-Budget, and Ms Reeves was a graduate of Oxford (PPE), the London School of Economics, and the Bank of England, no less. As a statistician might say, there’s no correlation or causation.
Far more important for success are the other talents Ms Mahmood can bring to bear: an ability to command her brief, set priorities, steer the civil service, and communicate the elusive “narrative” – alongside a certain toughness, and an ability to win the confidence of investors (with every indication that she is calming the gilts market even now).
A more difficult question is how her relationship with Andy Burnham and his team will develop. For an administration to function properly, the chancellor and the prime minister have to be thick as thieves, display mutual trust, respect and support, and preferably be free of any leadership rivalry. This is not only a matter of personal chemistry, but requires a common outlook and policy agenda.
Whether Mr Burnham and Ms Mahmood have all of the above in tandem is so far unclear. They come from different wings of their party, and Ms Mahmood doesn’t lack ambition herself (although, at 45, she has time on her side). She is a traditional Labour right-winger, and Mr Burnham (in his latest incarnation) is the darling of the soft left, so far as can be divined.
In broad terms, Ms Mahmood seems well suited to pursuing a more fiscally conservative agenda – whereas Mr Burnham, drawing on his experience in Greater Manchester, is temperamentally more expansionist, doesn’t like to say no, and is more inclined to borrow to invest, on social as well as purely economic grounds. In this, he is joined by such powerful figures as Jim O’Neill, Andy Haldane and others.
In a Burnham administration, No 10 (and No 10 North) will likely take a much closer interest in Budget decisions and the economic strategy than Sir Keir has done. But he must not, despite the temptation, make the next Labour government all about the redistribution of wealth rather than its creation; that is always a fatal mistake.
Much the same might be said of the important subsidiary questions that flow from a growth agenda – adjusting the fiscal rules, taxing wealth, reforming property taxes, and instituting welfare reform. How will he harness the power of AI? Plan for an ageing population? Get energy bills down in the longer term? Forge new trade deals?
If Mr Burnham and Ms Mahmood can agree on all this and more, and carry their MPs with them, then they will certainly fare better than Sir Keir and Ms Reeves. If not, and if welfare reform fails again, then they, the government, the nation and their party will be back where they started. But while fellowship is essential, it is no substitute for ability. Fortunately, Ms Mahmood has the latter in spades.
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