Whatever it Takes: The Real Story of Gordon Brown and New Labour. Steve Richards
main objectives.
There was also another reason for Blair placing Whelan at the top of his prime-ministerial hit list. He wanted to break up Brown’s separate court. As far as Blair was concerned there was room for only one Prime Minister – a perfectly reasonable line to take, not least from the person who happened to reside in Number Ten. Blair knew that if he did not make a move right away it would be too late and a pattern would be established in government that followed what had happened in opposition with an alternative power base at the Treasury.
Predictably Brown was resistant, and Blair did not push it hard either, claiming that his concern was solely one about the government having a clear message. Alert to any attempt at challenging his empire, Brown saw in this move a first attempt to put him in his place. Blair had a press secretary, but apparently he was not allowed one. Brown regarded the suggestion as an attempt by Number Ten to seize control of the media agenda, whereas he had every intention of making his own distinctive mark in that area.
The quick exchange between two exhausted individuals in the immediate aftermath of a historic victory was tense, fuelled by mutual suspicion, and yet as they addressed issues related to internal factionalism they also managed briefly to discuss a historic policy as they geared up to make the Bank of England independent. There were to be many more such exchanges, angry, awkward, media-obsessed and humourless, although both of them possessed a sharp, humanizing sense of the ridiculous.
Two questions arise from their first exchange as rulers in a landslide government. Why did Blair not insist on getting his way – an echo of his weakness at Granita? Was Brown justified in refusing to become in effect a mere cabinet minister without his own courtiers around him?
The answer to the first question is fairly straightforward. In spite of his towering popularity, Blair did not feel strong enough to antagonize Brown, nor at this stage was he inclined even to try. He knew they had to find a way of working together and was not going to blow the relationship apart on Day One. He thought it was worth giving the future of Whelan a try partly because he wanted to send a signal to Brown that he was on his case and would not tolerate divergent briefings, but he never expected Brown to give in.
The answer to the second question is more complicated. On one level Brown’s determination to have his own people working for him rather than for Blair or for the government as a whole was self-indulgent, divisive and grandiose. Yet as a new Chancellor he was under immense pressure to prove that Labour could be trusted to run the economy, a challenge almost as great as the one facing Blair as the incoming Prime Minister. In addition Brown was pioneering economic policy single-handedly. Only his immediate entourage understood his distinct New Labour strategy: a reassuring public narrative and the implementation of some social democratic policies by stealth. He needed them. In such a context he was justified in having his people around him even if their subsequent behaviour vindicated Blair’s concerns.
Their meeting lasted little more than half an hour. Soon Brown left Blair’s small empire in Downing Street and headed for his mighty institution in Whitehall. When Brown arrived at the Treasury he was greeted by 200 cheering civil servants. Those who were settling in at Number Ten watched warily as Brown was met by a noisy euphoria. Some of them suspected Whelan of orchestrating the move to convey a sense that here was an alternative centre of power with its own emperor. Whelan denied this, pointing out that he would have been in no position in advance to instruct senior Treasury officials to act in a certain public way. Yet the symbolism was striking. Blair had been cheered into Number Ten earlier in the day. Brown had been cheered into the Treasury. The two of them were operating from different centres now, with their own distinct resources.
Brown’s reputation remained high in the early years of the government partly because he had worked out a detailed plan that he more or less kept to. As John Prescott joked privately in the early autumn of 1997, most of the government had ‘hit the ground reviewing’. There were hundreds of policy reviews instigated as an alternative to policy making. Prescott had certainly launched several in his grand, newly created, dysfunctional Department of Transport, Environment and the Regions, otherwise known as the department with responsibilities that interested neither Blair nor Brown. Misguidedly the duo had no interest in transport, even though so many voters needed to travel. On this Prescott was way ahead of them. But they gave him no space to move in.
As a whole the government conveyed a deceptive impression of hyperactivity, but much of the ministerial energy was sapped by their instinct to kick decisions into the long grass.
In contrast, Brown started to implement policies in ways that gave the otherwise tentative administration much-needed momentum. Indeed one of the lessons of Brown’s tenure at the Treasury is that the policies that sprang from arduous preparation in advance tended to endure while those announced more superficially, with the aim of outmanoeuvring the opposition or buttressing his own position, quickly fell apart. Brown’s experience proved that hard work behind the scenes on making policy nearly always pays off. Superficial initiatives usually rebound on their political creators. Towards the end he became more attracted to the superficial.
Brown’s early policy making after the 1997 election also challenges another of the main accusations made against him by his internal opponents and the Conservatives. Soon Blairites accused Brown of being too cautious and lacking political courage. They felt this passionately and with sincerity. They were not making it up in an attempt to find artificial causes for their disdain. But they were wrong.
It is true that Brown could be paralysing in his caution over day-today decisions. His ministerial critics witnessed many examples of disproportionate hesitancy. They drew too sweeping a conclusion from the dithering, failing to recognize the bravery of Brown’s longer-term objectives, probably because economic policy was cordoned off from the rest of the government. Brown’s critics had not been allowed to interfere with, or debate, the programme for the economy, so they took what happened more or less for granted.
This was highly unusual. Normally economic policy was the main subject of internal debate within a government. In the 1970s at least half the cabinet had firm and conflicting ideas. During the early 1980s the debate between wets and dries in Margaret Thatcher’s first government was over economic policy. John Major’s government was torn apart by disagreements over the Euro, partly an economic matter. Under New Labour Brown did economic policy, bestowing on the rest of them the luxury of taking growth for granted while they explored other ideas – such as ‘choice’ in public services – on the assumption that as if by magic plenty of money would be available for their schemes.
In the early years Brown was bold in two respects. He showed a determination to challenge Treasury orthodoxy and some of the powerful individuals in the mightiest Whitehall department. That took quite a lot of courage from someone with no previous ministerial experience of any kind. Second, some of the policies involved considerable risks, although they were risks of a very limited kind.
Balls had written a detailed paper on the Bank’s independence as early as 1995, gripped by the need as he saw it ‘to sort out the Bank’. He was a powerful persuader. During a meeting with senior Labour strategists in March 1995 he put the case strongly that in a global market: ‘There is little any national government – and particularly a Labour government in a small country like Britain – can achieve by manipulating interest rates in the short or medium term. Stability and credibility are all.’
That was the aim: to acquire a reputation for stability and credibility in order to gain the freedom to act in other areas, such as increasing public spending, without being swallowed alive by the markets, business leaders and the media, the fate of previous Labour governments.
In May 1995, Brown gave a strong public hint about the direction in which he was heading. In a speech he spoke of the need to ‘remove the suspicion that short-term party-political considerations are influencing the setting of interest rates’. As a Chancellor he would ‘consider whether the operational role of the Bank of England should be extended beyond its current advisory role in monetary policy making’. He praised the ‘openness of debate and decision making which occurs in the US and the internal democracy of decision making of Germany’s Bundesbank and the targets set by the New Zealand government’. We journalists should have guessed which way he was heading.