Even Downing Street policy wonks were alarmed to see the Institute for Fiscal Studies’ (IFS) analysis of that leaked Treasury document. It suggested that in order to make the public deficit a surplus and balance the books, a simple subtraction would require all the money that had gone into the public services since 1997, well it had to be, ehem, taken right out. Sure, that was the boffins number-crunching a little too carnivorously but still aides working inside Downing Street who had worked inside the same building at the very time the taps were turned on, were shocked.
Text messages flew, mostly black in humour. ‘I can see,’ said one source from inside, ‘Gordon ransacking classrooms for books, whiteboards and protractors to flog on eBay’. The ‘black’ element of the humour being that for this employee of GB’s, this was all too easy a thing to picture.
The leaked document emerged – probably on purpose – just the exact day Brown had finally relinquished the cuts vs investment dividing line with the Tories. This summer process of reeducation and therapy led by Alistair Darling and Peter Mandelson was akin to weening Posh off spending money (divorces have been issued for much less than the simple crime of one spouse being told by the other to stop spending money). Spending, it seemed, had become an end in itself. (Though with Brown it was Comprehensive Spending Reviews not Comprehensive Selfridges Reviews.)
Eventually he said it, in his TUC speech. Five times. But for close observers the (further) damage had already been done – one special adviser said it had been obvious for eight months that he would need to make such a speech; another Downing Street aide was more charitable, suggesting it might only have been obvious for six months. For most, the answer to ‘What Would Blair Have Done’ was not flattering. Much is made of Brown’s difficult nature, but insiders say that this debate has effectively completed his transition from central and terrifying boss to terrifying but peripheral role. It’s been said a lot but again it should be restated, it is Peter Mandelson who junior staffers regard to be their boss.
But back to the End of Spending. The paradox now, according to some, is that after this period of spending being Bad, at some point soon Brown is going to have to come out and argue, ahead of the next election, in Defence of Spending. The public dislike of spending has reached a fever pitch but when it is reality rather than rhetoric, they will wince at the effects on their schools and hospitals and it will be up to a centre-left leader to defend the concept. A high risk strategy. Can Brown make that argument convincingly after being so thoroughly behind the curve so far? Real shopaholics would not be let back in the shops so soon.
The other problem being worked on right now by the guys with the grey matter is the new dividing line: Tories would cut frontline, Labour wouldn’t. This would be an easy line to develop if the proportion of frontline spend to backroom was say, 60:40, but according to the Insider’s source, they don’t know the ratio. Yet. They’re working on it.
Reasons to be cheerful
And so to the cabinet in exile – Jon Cruddas who said he wouldn’t accept jobs in Gordon’s government and James Purnell who gave one up. Cruddas gave the Compass annual summer lecture and Purnell responded. Apart from a few rolling eyes from Guardian journalist John Harris when Purnell spoke, the room was a study of respect and earnest politeness. These people – the soft left and the centre left – are determined to get on. Now we hear there’s a similar thing with Neal Lawson from Compass joining forces with Stephen Twigg from Progress. If the leadership is in disarray, at least the factions show no interest in fighting. Yet.
The reluctant rebel
And then the reason to be depressed. The Insider hears news that the eminent Barry Sheerman is to run in the parliamentary Labour party elections to replace current chair Tony Lloyd, with his candidacy ostensibly about improving the status of the PLP but actually about getting rid of him indoors. Sheerman said he didn’t think of this idea himself but since it’s been in the (damn) papers he’s had so many people tell him it’s a good idea, he might do it after all. It’s a funny one this. The Insider can report of many backbenchers who hate the thought of Sheerman bringing the issue back to a head; but of a couple of cabinet ministers thinking the idea might have legs. Maybe the backbenchers have a high expectation, maybe the ministers a low one. Maybe the cabinet ministers are getting more irritated by Brown than the backbenchers. If so, things are up for Brown. But we’ve heard that before.