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It was a job for a warrior. So how come Cameron sent a big softie?

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Tories have despaired at Cameron's conduct over Leveson after he forged a late-night press regulation policy at Ed Miliband's office

It was meant to be the week when the Tories’ Election campaign began. The Budget was designed to arm every Tory MP with a message for the doorstep.

But instead this became the week where David Cameron landed himself with a problem that will bedevil him all the way to polling day.

The problem is a system of press regulation that has alarmed nearly every newspaper in the land and infuriated several Tory Secretaries of State.

Compounding this problem is that this wasn’t a deal made in Downing Street, but in Ed Miliband’s office.

One despairing Cabinet Minister says when he woke up and heard what had happened, he put his pillow over his head and considered resigning.

It is little wonder then that Lynton Crosby, the man Cameron hired to deliver a Tory victory at the next Election, is so concerned by events.

A friend remarks ruefully: ‘Lynton told them to sort minimum alcohol pricing and Leveson as they were both distractions from the main message. But this certainly isn’t what he had in mind on Leveson.’

This was a U-turn with added political incompetence – for ten days previously, Cameron had called off cross-party talks saying the distance between the parties was unbridgeable.

  More... Ed Miliband admits that the biggest obstacle for Labour at the next election is the public's lack of trust in politicians Lords rebellion on press watchdog: Peers table amendments as fears grow over the proposals

Even one of his longest-standing allies admits the deal was ‘terrible and ridiculous’. One No 10 aide defends the agreement but concedes: ‘No one was thinking through how it looks.’

Labour's negotiators are incredulous at how the Tories handled things – allowing Oliver Letwin to be summoned from his bed to late-night talks and to arrive without any political support. One says: ‘We couldn’t believe they hadn’t created a  better, stronger team. They were so apolitical about it.’

The fact the mild-mannered, consensual Letwin was doing this job at all reveals how politically naive No 10 can be. One Secretary of State points out that ‘when you’re in a knife fight with Miliband on the issue he’s used to define himself, it is risky to send in a healer not a warrior’.

Mild-mannered, consensual policy minister Oliver Letwin was called from his bed to the talks on press regulation

This week’s events have led to a growing feeling in Tory circles that Crosby, the man who led Boris Johnson to victory twice in London, needs to go full-time.

If he doesn’t, political mistakes will keep on happening – making his job and a General Election victory impossible.

One Minister who knows the Cameron operation well insists that Crosby ‘won’t be able to do what he needs to do unless he’s around every day’.

Crosby is already proving hugely influential.

One Osborne ally tells me ‘to say that this was Lynton’s Budget as much as George’s Budget is an exaggeration. But there’s some truth to it.’

So far, he has fitted into the team better than expected.

Many thought the straight-talking Australian’s style wouldn’t suit the more genteel Cameron circle.

But even Andrew Cooper, Cameron’s chief strategist, who was expected to clash spectacularly with Crosby, is getting on with him.

The unpolitical nature of No 10 has long been a source of irritation to Tory Cabinet Ministers.

At a political Cabinet meeting last year, several Ministers complained forcefully to Cameron about it.

There are signs that their message is starting to get through. Oliver Dowden, the recently appointed deputy chief of staff, is proving adept at pushing Tory changes through the Whitehall machine.

And Ameet Gill, who has been with Cameron since he became leader, has now been put in charge of the Government’s daily agenda, bringing a sense of energy and discipline to it.

Acknowledging that there’s a problem, Cameron has taken to telling people he wants the Government’s message to be ‘cleaner and clearer’.

But if the Tories are to be in with a fighting chance at the Election, they’ll need to realise they’re in a political battle now.

The Budget showed that when they remember that, they are competitive. But last week revealed what disasters happen when they fail to grasp this.

  Cyprus is in the middle of the longest bank holiday in history and, when banks do reopen, there will be strict limits on how much money people can take out.

But the UK Government believes the island isn’t going to end up being the first to quit the single currency.

One senior figure says: ‘Angela Merkel is playing hardball but she doesn’t want the economic danger of Cyprus leaving the euro.’

But one Minister concedes that the situation is moving so fast it is hard to know what will happen next, especially given that Germany was reluctant to see Cyprus even join the EU in 2004.

If the Cypriots do leave, it’ll be the cheapest place in Europe to holiday this summer.

  David Cameron will head north of the border in the coming weeks as the Government continues to plot how to beat Alex Salmond in the 2014 Scottish independence referendum.

Salmond, for his part, is missing no opportunity to get under the  skin of Cabinet Ministers, by signing off letters to them: ‘Yours for  an independent Scotland.’

But Patrick McLoughlin, the no-nonsense Transport Secretary, has come up with a simple response. He finishes his own correspondence to Salmond: ‘Yours for a United Kingdom.’

THEA...THE NEW GIRL WHO PUT THE GLOSS ON GEORGE'S BUDGET SHOW Former BBC producer Thea Rogers is said to be behind the Budget's slick presentation and improving Osborne's media performances

The night before the Budget, George Osborne and his Treasury team sat eating takeaway Domino’s pizza as they went through the details one last time.

There was a certain nervousness. They knew Osborne couldn’t afford for this Budget to unravel as the last one had.

Today, it is clear it hasn’t. Much of the damage done to the Chancellor’s reputation on the Tory backbenches by last year’s events has been repaired.

Osborne’s political capital and confidence are also returning.

As one Cabinet ally proclaims: ‘We’ve got the full George back.’

Osborne has done much to try to avoid a repeat of last year’s problems.

He’s strengthened his ministerial team, bringing in Greg Clark, one of the cleverest Tories in Parliament, and Sajid Javid, a former banker and one of the stars of the new Tory intake.

He’s also bolstered his office with two new advisers. Neil O’Brien, former head of think-tank Policy Exchange, is responsible for the Chancellor’s refrain that the Government is for ‘people who work hard and want to get on’.

The other arrival is former BBC producer Thea Rogers, left, who worked with the Corporation’s Political Editor Nick Robinson. Insiders credit her with the slick presentation of the Budget and improving Osborne’s media performances.

But the real challenge for Osborne and his team will come with the spending review in June, which must set out a further £11.5 billion of cuts.

It is hard to see how the numbers can be made to add up, given there will be no further savings from welfare, and the Lib Dems are determined to protect the budget of Vince Cable’s Business Department, which they believe to be key to growth.

This means the only option appears to be big cuts in the Tory-run Home Office and Defence.

This won’t go down well with their Ministers, who have already spoken out against more cuts.

One Treasury source concedes the spending review will ‘get noisy’ but is adamant they ‘will get it done’.

If Osborne can manage to square this circle, his political authority really will be restored.



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