End of the honeymoon? Jim O’ Neill resigns from Theresa May’s government

Osborne 'star signing' leaves Treasury


Treasury minister Jim O’Neill has announced his intention to stand down — hitting Theresa May’s government with its first resignation.

O’ Neill, a peer and former chief economist at Goldman Sachs, was considered one of George Osborne’s ‘star signings’ when he joined the government to strengthen relations with China. He was also one of Osborne’s key allies on the Northern Powerhouse.

Over the summer, O’Neill trailed his intention to quit unless the prime minister could explain why she wanted him to stay on. According to the FThe was ‘baffled about the government’s change of tack on China’.

In his resignation letter, O’Neill said his primary motivation for joining the government was to help to deliver the Northern Powerhouse, and ‘to help boost our ties with key growing economies around the world, especially India and China.’

“The case for both to be at the heart of British economic policy is even stronger following the referendum, and I am pleased that, despite speculation to the contrary, both appear to be commanding your personal attention.”

While resignation letters are always measured, there is a hard edge to O’Neill’s comments, particularly as he draws attention to the perception that the prime minister has been slack in her dealings with China.

Moreover, O’Neill makes clear in the letter that in the House of Lords he will be moving from the Tory benches to the cross benches, which means he will now be in a position to criticise the government.

While the prime minister has been enjoying a rather lengthy honeymoon, this resignation — on top of divisions over grammar schools and Brexit — highlights that things are not as placid as they seem, and that tensions may be growing between those loyal to Cameron and Osborne, and those surrounding the new PM.

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