Interesting rumours have been trickling out of the PLP and Labour HQ over the past fortnight about the seemingly imminent reshuffle. Uncut has pieced together various accounts to give a view of just what has been going on.

Earlier this month, amid the fall-out from the Scottish referendum and Labour conference, as MPs’ discontent with Ed Miliband bubbled up into the press, a plan was hatched by the leader’s inner circle.  A move so bold that it would reset the political clock, seize the attention of the journalists and demonstrate Ed Miliband’s leadership credentials.

The long awaited reshuffle was overdue and its centre-piece was to be Ed Balls’ ejection from his brief as shadow chancellor.

The tensions between the leader’s office and Ed Balls’ team have been well-documented. Ed Balls was not Ed Miliband’s first choice as shadow chancellor – that was Alan Johnson – and from the leaked e-mails last year, where Ed Balls was described as a “nightmare,” by Ed Miliband’s advisers, to  the two Eds’ splits over whether to retain the 50p rate of tax and their widely aired disagreement on whether to back or bin HS2, the relationship has always been uneasy.

With Labour trailing the Tories by twenty points on the economy and discontent on the left and right of the party with Labour’s economic offer, the rationale for action was obvious.

Balls’ potential destination was unclear. One option canvassed was foreign secretary with Douglas Alexander becoming a full time general election co-ordinator. However, the preferred choice was a switch to home affairs, with his wife, Yvette Cooper, becoming shadow chancellor.

Come what may, Ed Balls would have been furious, but to cause trouble in the run-up to the general election would have been difficult. All the more so,if his wife was the shadow chancellor, a role it would have been difficult for Cooper to turn down, especially given her own ambitions to lead if Labour is defeated next year.

For Ed Miliband’s circle, an added bonus of this scenario was that Yvette Cooper would then have to take full ownership of the general election outcome next May.  As shadow chancellor, there would be little opportunity for her to disavow the result or present herself as having privately backed an alternate approach.

With many around the leader still thinking he can hang on to the top job, even if the Tories remain in government after next May, minimising Yvette Cooper’s political room for manoeuvre in this way, was particularly attractive.

Last week, a briefing to George Eaton at the New Statesman previewed the argument that would be used to justify the shift.

He wrote,

“In 2011, in one of the first major policy announcements of his leadership, Miliband said that Labour would reduce the headline rate to £6,000, but this did not amount to a manifesto commitment… the policy was resisted by senior figures (said to include Ed Balls, shadow universities minister Liam Byrne, and policy review co-ordinator Jon Cruddas) concerned about the estimated £2bn cost. A source told me, however, that Miliband is still keen on the proposal.”

Ed Balls was going to be the fall guy: the fiscally cautious brake, preventing Labour from pitching an expansive policy platform to the electorate; the man who stifled his leader’s radical inclinations, a shadow chancellor who was just too associated with the mistakes of the ancien régime.

The public statements announcing the changes would have all been about refreshing the team for the final push to the election, and there would have been warm praise for the good work done by Balls in the brief. But behind the scenes, the briefings would have been clear: Balls was the blocker, Ed Miliband is a tough leader, Balls had to go.

And then Heywood and Middleton happened.

Labour’s disastrous showing in the by-election has weakened Ed Miliband in a way that few could have foreseen. The initial reports of the leader’s performance at the PLP meeting on Monday might have been largely positive but the rank and file are far from happy.

Following the meeting, Uncut received a text from an attendee comprising just three words: “Not good enough.”

That the meeting was billed as a make or break moment for the leader is indicative of his parlous standing among his colleagues.

In this post-Heywood context, the upheaval associated with moving the shadow chancellor would have been too much. Ed Balls wouldn’t have had to say a thing, there are now enough unhappy backbenchers within the PLP who would have broken cover and publicly attacked the leader.

The Ed Balls move was put on ice; but without a signature change, what was the point of the reshuffle? Out of the shadow cabinet’s heavy hitters, Andy Burnham is untouchable at health, Chuka Umunna is seen as having done a good job maintaining Labour’s strained links with business, and any lateral move for Yvette Cooper would have been viewed as a demotion, enraging Ed Balls and his supporters.

A reshuffle without any change for these major players would just have been reported as shuffling the deckchairs. So it was scrapped. There might still be some minor changes around the edges of the shadow cabinet, but nothing on the scale that was planned just a few days ago.

Labour’s top team will now go into the election largely unchanged, despite the leader’s own intentions.

Tags: economy, Ed Balls, Ed Miliband, Labour reshuffle, PLP, Yvette Cooper

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