SUGGESTIONS of a cabinet rift between George Osborne and Iain Duncan Smith were scotched by a senior minister yesterday, but Whitehall sources insisted the pair were at loggerheads.
David Willetts, the universities minister, said he was “not aware” of any acrimony between the chancellor and Duncan Smith, the work and pensions secretary. “All I can say is that all of us are working hard on saving money in our departments,” he added.
But friends of Duncan Smith said he was frustrated by Treasury officials working for Osborne, who he says treat his staff with disrespect. Clare Lombardelli, the Treasury mandarin in charge of welfare reform, has been identified by Duncan Smith as one of the key culprits.
The chancellor also balked at the £3bn up-front cost of Duncan Smith’s welfare reforms, insisting the Department of Work and Pensions make £10bn of cuts elsewhere to help fund the plans.
A source close to Duncan Smith suggested he would resign if the chancellor blocks his welfare reforms. “Iain didn’t come back into politics for vanity. He’s got one simple aim: to reform the benefits system. If he can’t, there will be little reason for him to stay in government.”