CCHQ gets crunched

When news of the Tory budget cut was broken by Conservative Home it was spun as a prudent cost-cutting. Yet there is (as ever, with CCHQ) plenty of comic chaos behind the scenes. The basic problem was overspending in the boom years. Last year the cash was flowing in from bankers who could easily spare £50,000 and would pay even more to touch the hem of David Cameron. Things were going so well that, according to one version I’ve heard, David Cameron personally added £2 million to the budget, saying the party had to spend to get more cash. Other sources say it wasn’t Cameron, the machine just grew fat on its own. But either way, one thing’s sure: they should have put more money away for a rainy day; fixed the roof when the sun was shining. Those bankers don’t have any cash anymore.
 
As charity donations have plunged, so too have political donations – and this has hit the Tories disproportionately hard, because they get more individual cheques. Labour get huge cheques from the unions which are often seemingly repaid in state donations such as the “modernization fund” or some such. 
 
The group of those donating £50,000 has almost halved, I’m told, but other bigger donors have stepped up to the plate. The upshot is a 10 percent budget cut. Not catastrophic, but still enough for a shake-up. I hinted a few weeks back that there may be another shake up to the Conservative Research Department. I’m now hearing that it will be effectively disbanded, its staff sent to work with Shadow Cabinet members, and the Tories will instead rely more on ideas being churned out by think tanks like Policy Exchange, Reform and the Centre for Policy Studies (where yours truly is on the board). Under UK charity laws, they have to be cross party so Labour can benefit too*.
 
Those at the hard end of the cuts point out that there is precious little bloodletting in Norman Shaw South, the former Met HQ which is now the Cameroons’ nest. Those surviving argue that CCHQ needs to focus on core election-winning strategies, and other operations such as outreach to womens’ groups, ethnic minorities etc have had to go. And anyway, CCHQ will be reduced to a skeleton staff if Cameron wins the next election and his aides become Spads. So axing the 22 CCHQ staff and others is seen by the more optimistic Tories as preparing for this great day. The return of Oliver Dowden to CCHQ shows it can still lure back some of the heavyweights that were allowed to slip away last year.
 
But at the root this cost crunch is a rather embarrassing fact: the Tories didn’t see the crash coming (very, very few did) and imagined this bankers’ jackpot would keep on coming. It was, in fact, a freak event and CCHQ is, like so many businesses, being forced to readjust. It’s bad, but hardly terminal. For as long as the Tories are the overriding favourites to win the next election, they won’t go bust.
 
* Being a cross party think tank is less of a burden that it may sound, given that the real  ideological dividing line is not so much between Labour and Tory but between liberals and statists. Blair, Milburn, Cameron, Laws, Gove, Purnell & Field are on the right side of this line. Brown, Balls, S Hughes, the unions (in my darker moments, I think Lansley) and the Tory paternalists are on the wrong side.