Fairness agenda gets lost in the melee

The Queen's Speech is normally one of the highlights of the parliamentary calendar - but the fact that this year's found itself rather drowned-out shows just how much the political agenda has shifted. Here's today's Journal column.

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In any normal year, the Queen’s Speech to the State Opening of Parliament – officially known as the Gracious Address - would be one of the key events in the political calendar.

Admittedly, Gordon Brown has somewhat diluted its impact over the past couple of years by introducing a Draft Queen’s Speech in July – much as the Pre-Budget Report has somewhat diluted the importance of the Budget.

But even so, the Speech was still seen as one of the big parliamentary set-piece occasions, the point in the political year when a government sets out its agenda and tries to convey a sense of what it is all about.

Until this week, that is. For of course, this year is no normal political year – and this year’s rather truncated legislative programme was certainly no normal Queen’s Speech.

Even within the context of the week’s political news, the Speech seems to have been overshadowed by other, more immediate issues.

On Monday, for instance, we had the statement to the Commons by Childrens’ Secretary Ed Balls setting out the findings of the preliminary inquiry into the Baby P tragedy.

The report was as damning as they come and led to the immediate suspension of Haringey Council’s director of childrens’ services, Sharon Shoesmith – though she remains unaccountably on full pay.

Mr Balls may not be the most empathetic of politicians, but he does at least do firm and decisive well – and this Commons statement showed him in his best light.

Then we had the ongoing and increasingly bitter controversy over the arrest of the Tory frontbencher Damian Green and the raid on his Commons office just over a week ago.

No-one seems to have come out of this episode particularly well so far. For House of Commons Speaker Michael Martin, in particular, it seems to have turned into the story from hell.

Already under fire from MPs for having allowed the police to raid parliamentary premises in the first place, his troubles intensified this week when he was forced to admit that they had done so without a warrant.

It would, in my view, set an incredibly unfortunate precedent if MPs felt obliged to defenestrate him – but perhaps instead Mr Martin should now make clear he will be standing down ahead of the next election.

The position of Home Secretary Jacqui Smith seems less under threat, but she seems scarcely less culpable than Mr Martin in her handling of the affair.

To cut a long story short, it seemed she knew that the police were investigating the leaking of confidential Home Office documents, and knew that the said documents were being passed to the Tory Party.

What she claims she didn’t know was that Mr Green was the Tory frontbencher specifically under investigation by detectives, or that he was about to be arrested.

Whether she should have known is the key point at issue here. At least two of her predecessors – the Tories’ Michael Howard and Labour’s John Reid – clearly think she should.

All of that said, I have my doubts as to whether the Conservative Party will itself come out of this sorry affair with its reputation enhanced.

Much will depend on the motives of the “mole” and whether, as Business Secretary Peter Mandelson alleged on the BBC’s Today Programme, he was leaking material to Mr Green in order to further his political ambitions.

Occasionally in political journalism, you come across a story that starts out by looking highly embarrassing to one side and ends up with the other side having egg on its face.

I have a slight hunch that this could turn out to be one such case.

But if the Baby P inquiry and the Damian Green affair were not enough to squeeze the poor old Queen’s Speech off the front pages, we then had the reduction in interest rates to their lowest level for 57 years.

Since this will actually put money back in peoples’ pockets in the form of lower mortgage payments, it is far more likely in my view to kick-start economic activity than last week’s 2.5pc cut in VAT.

But the swift change of direction by the Bank of England Monetary Policy Committee – it is only last year that rates were still going up – is almost worthy of a Private Eye-style apology.

“For years, we along with the rest of the UK political establishment may have given the impression that inflation is the worst thing can happen to the economy. In fact, we now realise that deflation is much worse, and apologise for any misunderstanding.”

So at the end of the day, was there actually anything in the Queen’s Speech worth writing about? Well, yes, although it was probably just as notable for what it left out as for what it included

What it did include was the remnants of what Mr Brown in his party conference speech in September termed the “fairness” agenda.

This included a Bill aimed at getting people on lower incomes to save more with the government promising to contribute 50p for every £1 saved up to £600.

And back on the agenda, to some surprise, was the measure to give employees the right to request flexible working hours, which many suspected Mr Mandelson had killed.

Perhaps significantly, though, the Speech did not include Mr Brown’s much-vaunted Constitutional Renewal Bill, which would among other things have given MPs the final say on going to war.

This was once a key plank in Mr Brown’s reform programme and was actually the subject of his first statement to the Commons as Prime Minister.

That it now no longer even merits a place in his government’s legislative programme is just one small illustration of how events have altered Mr Brown’s priorities and how the political agenda has shifted.

And the fact that it went almost unnoticed by the national media surely only serves to underline the point.

It's not that I don't care, honest....

To anyone who has come here this week hoping or expecting to find my thoughts on the Damian Green affair, or the Queen's Speech, or the suspension of Sharon Shoesmith, or the interest rate cut, or anything else for that matter, may I offer my apologies.

They were all subjects worthy of a blog post and, had I had more free time this week, I would certainly have done covered them.

That said, I am in one sense relieved that I didn't rush into print with my thoughts on the Green controversy. As a democrat, my initial instincts would obviously have been to defend the Tory frontbencher's right to leak confidential material, and to question the political wisdom of Gordon Brown's refusal to condemn the police action.

Now, I'm not so sure. Yes, Jacqui Smith should have known what was going on in her own department. Yes, Michael Martin should have known the police didn't have a warrant, but my gut instinct tells me that we've not heard anything like the whole of this story yet, and it would not surprise me in the least if it eventually turned itself inside out, leaving the Tories as the ones with egg on their faces. As I said, just a hunch.....

On reflection...they could have spent that money better

There's an old saying in politics that Budgets look different a week after they are delivered than a day after - and I guess Pre-Budgets are no exception. After initially praising the Chancellor's decision to cut VAT on Monday, I've revised my opinion somewhat. Here's today's Journal column.

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Thirteen months ago, Chancellor Alistair Darling stood up to deliver his first Pre-Budget report in the House of Commons in what was an atmosphere of political ferment.

Prime Minister Gordon Brown was coming under heavy fire after scrapping plans for an autumn election and the PBR – brought forward by a month from its normal November slot – was being seen as a chance for Labour to regain the political initiative.

In a bid to trump Tory plans to scrap inheritance tax for all estates below £1m, Mr Darling announced an immediate doubling of the threshold for the tax to £600,000.

But the attempted vote-grabbing manoeuvre backfired horribly, making Labour look like a government that had run out of steam and which was now reliant on the opposition for new policy ideas.

A year on, the stakes for Mr Darling were even higher. Against the backdrop of the worst economic downturn in decades, this year’s PBR needed to show that the Chancellor was the man with the plan with tackle the crisis.

Not only that, but Messrs Brown and Darling also needed to demonstrate that their plan was better than anything David Cameron’s Conservatives might come up with.

Well, the backlash against this week’s PBR has been nothing like the widespread public contempt that greeted last year’s, but neither has there been anything resembling a public outburst of enthusiasm for it.

It’s still relatively early days for Mr Darling’s Chancellorship, but if pressed for a judgement I would have to conclude that Pre-Budget Reports are probably not his strong point.

Sure, Monday’s statement had its good points, notably the decision to bring forward £3bn of spending on infrastructure projects and the earlier-than-planned increases in pensions and child benefit.

Welcome, too – at least as far as this columnist is concerned – was the long overdue decision to increase the top rate of tax on the highest earners, though only on those earning what for most of us is the undreamed-of sum of £150,000-a-year.

This has been predictably hailed by some as heralding the death of New Labour, but in truth, the 1997 commitment not to raise the higher rate of tax had become almost as much of an outdated shibboleth as the original Clause IV.

The essence of New Labour did not lie in adherence to any single policy stance, more the idea that different times require different solutions, and in that sense, the 45p tax move is as New Labour as they come.

Neither, in my view, can Messrs Brown and Darling be accused of lacking courage in bringing such a package before the voters.

The Prime Minister has been called many things over the past fifteen months - but the soubriquet which possibly did him the most damage was the one applied to him in the wake of the non-election debacle - 'Bottler Brown.'

Well, he certainly didn’t bottle this one. On the contrary, he has been completely upfront with the public both about the sheer scale of borrowing that is required, and the fact that it will require post-election tax rises to pay for it.

For Labour to try to turn the normal laws of politics on their head by promising both
tax increases and spending cuts if re-elected is a strategy so bold it almost deserves to succeed on that alone.

But for all its boldness, there was a huge unanswered question at the heart of Mr Darling’s plan, namely, whether it will actually work either economically or politically.

The centrepiece of the Monday’s package was not the aforementioned tax increase for the super-rich, but the £12.5bn tax giveaway via the temporary reduction in VAT from 17.5pc to 15pc.

The economic thinking behind this at least is clear. The government hopes it will encourage people to go out and spend, and that the resulting boost to the retail sector will somehow kick-start the rest of the economy.

Unfortunately, there is no evidence that a price-cut that amounts to a fiver off a £200 telly will have anything like the desired effect in this regard.

But if the economic case for the VAT cut is unproven, the politics of it seem even less clear-cut.

Just ask yourself for a moment, if you were Prime Minister and had £12.5bn with which to try and win the next election, what would be the most vote-winning policy you could come up with?

Well, I don’t think Gordon Brown has asked himself this question anything like as hard as he should have done – because I am quite sure the answer is not a 2.5pc cut in VAT.

A cut in direct taxation, that would have put money directly back in people’s pockets rather than making goods very slightly cheaper in the shops, would have been a far, far better option.

One person who seems to have realised this is North Tyneside MP and former Cabinet minister Stephen Byers, who asked a revealing parliamentary question earlier this year.

Mr Byers wanted to know how much it would cost to lift half a million people, a million and a million half out of income tax altogether.

Intriguingly, the answer he received showed that the cost of lifting a million people out of income tax for one year—by raising the personal allowance by £960—was £11.1bn.

Would that not have been a much better use of the £12.5bn at Mr Darling’s disposal? And would not the Tories have had a much harder time arguing against such a tax cut?

It is for these reasons that I cannot see this Pre-Budget Report as anything more than a missed opportunity for Labour.

Unlike some, I don’t view it as a suicide note to the electorate on a par with the party’s infamous “Shadow Budget” in 1992, but neither do I see it as the springboard for a 2010 election victory.

My hunch is that if the economy recovers, and Labour’s political prospects with it, it will be more in spite of this package than because of it.

Once again, a chance to regain the political initiative has been squandered – along with the taxpayers’ billions.