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Laying my cards on a reshuffle

I am going to take my life in my hands and make some political predictions. I believe we are less than a year away from a general election. Time for some reflection on a likely summer reshuffle, perhaps?

Following last week&#39s local and European elections, it is highly likely that the Prime Minister will look to shuffle the pack and freshen up the Government team for the coming electoral test. It is also highly likely that the opposition parties will use the summer period to change their own teams.

The coming year will see political momentum build. Predicting the outcome of the next general election will definitely be easier than making reshuffle predictions. But as the silly season is almost upon us, here goes.

Ruth Kelly, a Treasury minister since the last general election, is now extremely experienced in financial services. Having started as Treasury economic secretary in 2001, her skilled conversations with the City and handling of Sandler pricing, child trust funds and EU relations have won major plaudits and allowed her to take the financial services brief with her when she became financial secretary in 2002.

After the previous revolving door of incumbents in the role of Treasury economic secretary from 1997 to 2001, it has been a major advantage to have a minister who really understands and appears to enjoy the brief. She is a trusted confidante of the Chancellor and her performance in the role has continued to demonstrate she is one of Labour&#39s rising stars. For that reason, I am sorry to predict that Kelly may be in line for an upward move that takes her out of the Treasury. The Chancellor will not be inclined to let her go but there is a significant chance this will happen.

As her political star remains bright and her touch is sure, she probably needs experience of working in a spending department, particularly around a public services agenda. Perhaps a move to education to take up the role Margaret Hodge has filled? This might create a political dream ticket of Kelly and high-flyer David Milliband at education. Charles Clarke would probably love to freshen up his team and inject some youth, vigour and intellect.

At the same time, Paymaster General Dawn Primarolo has been at the Treasury since Labour&#39s 1997 landslide victory and the Prime Minister might want to shuffle the Chancellor&#39s deck a little further although two ministers on the move might be a little too bold.

What are the predictions on who might fill Kelly&#39s shoes, in particular? Yvette Cooper, currently at the Office of the Deputy Prime Minister, might be ready for a move. In the main, she has been supporting the development of housing legislation with other ODPM ministers, Lord Rooker and Keith Hill. Cooper is a very able performer and is also close to the Chancellor.

Her husband is Ed Balls, the Chancellor&#39s closest economic adviser for most of his period in office. With Balls selected for Normanton, he is likely to become an MP at the next election so the Chancellor might want to have another ally to replace the current incumbents. If Balls wins Normanton – a safe Labour seat – he is likely to go straight to the Treasury or be parachuted into a big spending department as the Chancellor&#39s eyes and ears.

Others to watch in terms of the Treasury or Department for Work and Pensions might include James Purnell, currently Parliamentary private secretary to Kelly. Purnell was strongly tipped to become pensions minister last year and missed out. A former No 10 adviser, he may get his chance for a move this year and is considered highly capable and a thoughtful MP.

Another is Tom Watson, Parliamentary private secretary to Primarolo. Watson has good contacts with the unions and is well liked among members of the Labour Party. He is talked of as someone who has earned a promotion.

Finally, on financial services, watch out for John Denham, a former Home Office minister who resigned from the Government in March 2003 as the country went to war. He has been a very respected commentator on Labour&#39s domestic agenda and, in particular, thinking on asset-based welfare. He might just be a Government returnee.

There is little likelihood that there will be many changes at the DWP. Work minister Jane Kennedy has only been in the job for a couple of months while pension minister Malcolm Wicks still has a major job piloting the Pensions Bill when it returns to the Commons later in the year. It is highly unlikely the Government will want to make wider changes to its pension team at this stage.

Casting a wider eye across the Government, it is possible that Cabinet Office minister Douglas Alexander, in charge of election planning, might move into the more public role of Labour Party chairman.

The Prime Minister may also look to shuffle Geoff Hoon, who must be exhausted after an intense period in charge of defence. A good European, he is believed to be vying with Peter Mandelson to be the UK&#39s next EU Commissioner.

All this is pure speculation. But this time, I think we might see some Treasury changes which may present the financial services industry with a whole new set of challenges.

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