Downing Street's backroom boys want to save the Tories from themselves

Were a movie to be made about the Conservative Party’s recovery – The Big Social Network, perhaps – the first scenes in the mid-Nineties would not be set in Notting Hill, but in a small suite of offices in Queen Anne’s Gate. There, in what was in those days the home of the Westminster think-tank, the Social Market Foundation, three young centre-Right policy wonks started to ask systematically what the Tories were doing wrong and how the party might one day reverse its fortunes.

The SMF Three were Daniel Finkelstein, Rick Nye and Andrew Cooper. Even before the 1997 landslide defeat, they had developed the rudiments of what became Conservative modernisation, ideas that would ultimately evolve, a long way down the track, into Cameronism. They understood that the Tory party was regarded by the electorate as indifferent or positively hostile to the public services. More importantly, they also grasped that the voters had grown deeply suspicious of Conservative motives, to the extent that the party’s association with a proposal contaminated it in the public mind. To win again, the Tories would have to change the way they spoke, the manner in which they conducted business, the priorities they declared: the problem was not Conservative policies, but the Conservatives themselves.

All three went on to work for the party in various roles. During William Hague’s leadership, Finkelstein worked closely with George Osborne – a relationship that was to prove crucial in the harnessing of the Notting Hill set to the modernising cause. Cooper, meanwhile, was at the heart of Michael Portillo’s leadership campaign in 2001, and founded the polling organisation Populus – where he collaborated again with Nye. Finkelstein, in turn, became a political commentator of distinction. Naturally, many other forces played an indispensable role in the modernisation of the party. But the ur-text was undoubtedly the Diet Coke-fuelled work, a decade and a half ago, of the SMF trio.

This is why Cooper’s appointment last week as director of strategy at No 10 is an important moment in the evolution of the Coalition. Those who opposed modernisation from the start, or believe it has run its course, now fear that another carnival of husky-hugging is imminent, and that Cooper and his dangerous “metropolitan” friends are plotting to turn the Conservative Party into a pop music festival, in which pot-smoking, homosexuality and gender workshops will not only be permitted but compulsory. These arch-traditionalist Tories dread the “liberal elite” in the way that David Icke dreads 12ft lizards. And they are no less mistaken.

Cooper’s great gift to the Tory party has not been liberal ideology but a pitiless empiricism. He tells it how it is, on the basis of detailed poll findings rather than precedent or prejudice. This is not to say that he is a blank canvas, lacking conviction or true commitment to the Conservative cause. Quite the opposite, in fact (legend has it that he left multiple angry messages for Ken Clarke on the morning after the 1997 election, blaming him personally for the defeat). Cooper believes the party is too important to be shielded from unpalatable truths. In the unlikely event that his research reveals a public clamour for the Conservative Party to be more Right-wing or to stop talking about the NHS and schools and focus on Europe, he will not hesitate to tell the Prime Minister that this is so.

More to the point, he will take charge of the Government’s political story, its message or “narrative”. In the first nine months of the Coalition, this task has largely fallen to George Osborne, and it is inconceivable that the Chancellor will not retain a very strong interest in political strategy. But Cooper’s arrival will remove some of the burden from him. It will also free up Steve Hilton – who was never, in fact, “director of strategy” but was, and remains, “senior adviser” to the PM. This deliberately vague title enables Cameron’s political twin to roam across government as his plenipotentiary.

Though best known as for his “detoxification” of the Tory party brand, Hilton’s principal focus these days is the removal of all barriers to Government strategy, especially on the Big Society, transparency and public service reform. His objective now, in what will probably be the Coalition’s most difficult year, is to identify the bureaucratic obstacles, the naysayers and the vested interests, and to wipe them off the board. The caricature of Hilton as a slogan-mongering ad-man in a T-shirt is incorrect (apart from the T-shirt bit, anyway). He is better seen as that rarest and most lethal of Whitehall beasts: an enforcer with the absolute authority of the Prime Minister.

As such, he will retain oversight of the new policy unit, to be headed by Paul Kirby, a partner of KPMG. In contrast to the arrangement under New Labour, the unit will mostly be staffed by Whitehall officials rather than political appointees. And, as far as the Cameroons are concerned, it is urgently needed. Although the new No 10 structure has been planned for some time – sped by the resignation in January of Andy Coulson, to be replaced shortly by the BBC’s Craig Oliver – last week’s U-turn on forests was a wake-up call, a grave warning to Downing Street that there is a fine line between delegation and neglect.

Cameron’s instinct to let Cabinet ministers get on with it is a welcome change to the chronic centralism of the Blair-Brown era. This culture of trust undoubtedly makes for better government. Even so, Reagan’s maxim – “trust, but verify” – has a lot to be said for it. In theory, the new policy unit will ensure that reforms are being enacted in the right way, and act as an early warning system when the next potential howler approaches.

This does not mean that the PM should drop every unpopular policy – indeed, he would have few of them left if he adopted such an approach. But No 10 cannot afford to be caught on the hop as it was by the forest sell-off plan, and even by some of the detail of Andrew Lansley’s NHS strategy. In their own defence, senior Government sources say that the number of U-turns and policy pile-ups has been small when measured against the sheer volume of reform enacted by the Coalition in its first nine months.

Fair enough: but how many more lurk in the dense thicket of strategies that are only now being rolled out? How many cuts that seemed politically defensible in the rush to meet the deadline of last October’s spending review will look less so on closer inspection? Foreknowledge is all: Cameron must decide which battles are worth fighting, and which not. That doesn’t mean ditching his elegantly relaxed style of leadership, or becoming – God help us – another Brownesque control freak. It does mean establishing a system of rigorous, intelligent oversight in No 10, one that makes every senior minister feel that the PM might be peering over his shoulder at any moment. Laid-back Dave won’t be around quite so much in 2011: meet the new Napoleon of Notting Hill.