If IDS left, the Cabinet would be dangerously unbalanced. There would, in these circumstances, be only two people in it who the Tory parliamentary party considers to be on the right, Liam Fox and Owen Patterson. The right, as the Liberal Democrats seem to appreciate, would in these circumstances demand far more policy concessions from Cameron in return for its support.
The next problem would be that it would play into Labour’s narrative that the coalition is cutting recklessly, that there is no long term plan. I can just imagine Yvette Cooper on television claiming that IDS’ resignation proves that this is a government so right wing that even Iain Duncan Smith can’t serve in it. It would also rob the government of one of its central purposes. Education and welfare reform are the great principled crusades of this government; they are what give it a reformist authority.
Finally, it would pitch the coalition against the right-wing press. Both the Mail and the Telegraph are fully behind IDS. If he quit, these papers would become far more critical of the coalition.
George Osborne needs to get the Treasury to come to an accommodation with IDS. Everyone knew what IDS wanted to do before he was appointed and that he would quit if he couldn’t get it through. It might have been a risk to give him the job in the first place, but it would be an act of monumental folly to push him into resigning.