Certainly, if the PP approach does succeed in gaining Spain credibility with the bond markets, it will bolster the coalition’s arguments about the importance of sticking to Plan A. As Matt d’Ancona argues in The Sunday Telegraph, the Tory argument is rapidly becoming that while things might not be good now, they’d be even worse if there was any deviation away from the plan.
The other impact that a change of government in Spain could have is on the coming negotiations on amending the EU treaties. As I say in the Mail on Sunday, Cameron is now quietly confident that Merkel will help him gain some concessions. But if he is going to succeed in staring the process of bringing powers home—which would help the economy and greatly reassure his party—then he is going to need a network of allies across Europe. A new PP government could be an important part of that.