Mr Brown goes on holiday
Gordon Brown's summer holiday got off to a bad start. Having lost another by-election at Glasgow East on the 24th July 2008, his Foreign Secretary David Miliband subsequently took the opportunity to publish an article in The Guardian of the 29th July 2008 which was widely interpreted as being a coded bid for the party leadership. With many in the Labour Party now questioning whether they had made the right decision in crowning Brown as party leader, no doubt he had much to occupy his mind during his two weeks at his holiday home near Southwold in Suffolk before returning to work on the relaunch of his government which stubbornly remained some twenty points behind in the opinion polls.
Unfortunately it seemed as if not everyone in the government was quite singing from the same hymn sheet as Chancellor Alistair Darling gave what was described as an "exclusive" and "candid" interview which appeared in the Guardian Weekend magazine on the 30th August. This soon attracted considerable attention due to Darling expressing the opinion that the current economic problems facing the country were "arguably the worst they've been in sixty years" and then added that the crisis was "going to be more profound and long-lasting than people thought". Whilst Darling might have won plaudits for his candour, this was a noticeably different message from that emanating from Gordon Brown, who remained "cautiously optimistic" about the British economy when speaking to the CBI in Glasgow five days later.
Even less helpful were the remarks made by former Home Secretary Charles Clarke, when he wrote an article for the New Statesman magazine which appeared on the 4th September in which he suggested that it would be "best for the country" if "Gordon made his own mind up" and decided that it would be better to "go with honour". His comments were naturally dismissed by Brown's supporters such as Ed Balls, who said this was simply a case of "Charles being Charles", but it still brought forth another crop of newspaper headlines that served to nibble away at Brown's authority.
The Fightback Begins
It turned out that Gordon's Brown fightback was to be based on two sets of specific measures to address the nation's concerns; being a housing package to deal with the problem of falling house prices, and an energy package to deal with the problem of rising energy prices.
The housing package was first off the starting block and arrived on the 2nd September 2008 as Gordon Brown announced that "Homeowners need to know that we will do everything we can to keep the housing market moving forward", apparently unaware that the housing market had been in reverse gear for a good six months. Never mind, there was an announcement of a stamp duty holiday for a year on properties costing less than £175,000, the Department for Work and Pensions announced changes to Income Support for Mortgage Interest which meant that claimants would now only have to wait thirteen weeks before the government would meet the cost of their mortgage interest rather than thirty-nine weeks (although only from April 2009), whilst Hazel Blears, the Secretary of State for Communities and Local Government, announced an additional £1 billion housing package under the banner of 'Ensuring a fair housing market for all'. There was a "£200m mortgage rescue scheme", a £400 million scheme to help "social housing providers ... deliver 5,500 more social houses", a "new £300m shared equity scheme" labelled HomeBuy Direct, with another £100m set aside to help fund the changes to Income Support for Mortgage Interest.
Of course back in 1992 during the last 'housing crisis' Norman Lamont had also announced a stamp duty holiday and thrown £577 million at housing associations, neither of which made much difference, despite the fact that £577 million would have bought a lot more houses in 1992 than £400 million would in 2008, and quite apart from the fact that the £400 million had been obtained by bringing forward funding from future budgets, which simply meant there would be £400 million less available in the future. The provisions of HomeBuy Direct were uncannily similar to the various incentives on offer from a number of housebuilders which allowed buyers to defer a proportion of the purchase price, and it was immediately pointed out that perhaps most first time buyers would be better off deferring buying a home until houses were 30% cheaper, rather than deferring 30% of the current price which they would eventually have to pay back. Indeed the response to the package was distinctly underwhelming as it was soon realised that a "£1 billion housing package" was scarecly going to have much effect on a housing market where £1 billion would just about have covered a day's worth of transactions back in the heady days of 2007.
The energy package eventually arrived on the 11th September 2008, slightly later than expected due to the protracted nature of the negotiations with so-called Big Six energy suppliers. To many people's disappointment there was no windfall tax on 'greedy energy companies', neither was the any sign of the promised fuel vouchers, news of which had been leaked in August and was expected to be the "central plank" of the package. Brown did announce an increase in the cold weather payments made to pensioners and other 'low income' households when temperatures drop below zero for seven consecutive days, but the big idea turned out to be one of offering of free cavity wall and loft insulation for pensioners and poor households and 50% off cost of insulation for everyone else.
According to Gordon this was the "right approach" which would offer "lasting benefits and fairness for all families, cutting bills permanently every year". Unfortunately there was a slight misunderstanding, as when Gordon Brown said "pensioners" he didn't mean "all pensioners", but rather only those pensioners aged seventy or over. Indeed as it turned out people soon realised that pensioners over seventy and certain benefit claimants had been entitled to free insulation for some time. All that happened was that the government had twisted the collective arms of the energy companies into providing some more funding for this programme. Even then there was a sting in the tail, as David Porter, chief executive of the Association of Electricity Producers explained; "It remains to be seen just how much of it ends up on the customers' bill in the long term." It also became perfectly clear that the government had no idea how many uninsulated homes there were, or indeed how many homes would benefit from this imitative, since it all depended on how many people came forward and what capacity there was in the industry to meet the demand and the government was entirely clueless about the numbers involved.
The general reaction was even less enthusiastic than for the preceding housing package as Help the Aged described the whole thing as "Half-baked", Friends of the Earth claimed that it lacked "ambition and funding", whilst Age Concern insisted that it would "leave millions of the poorest pensioners wondering how they will afford their bills this winter".
Two damp squibs within two weeks did little to have revived spirits within the Labour Party, and the promised fightback appeared to have stalled on the launch pad. There were also distinct signs of unrest within the Trade Union movement who were unhappy that their members employed in the public sector were being forced to accept a 2% pay settlement when inflation was running at 5%. The TUC annual conference opened at Brighton on the 8th September and denounced the government's stance as "unfair and unjust", although the conference stopped short of calling for co-ordinated strike action and rather decided on a series of "days of action" including a planned "major national demonstration against the government's pay policy". Not to mention the fact that the TUC weren't happy about a lot of other things such as the government's plans on welfare reform which were described as a being"fundamental attack on the welfare state".
The Curse of Robinson
Questions therefore remained regarding Gordon Brown's ability to hold on to the position as Leader of the Labour Party, but on the morning of Friday 12th September that Nick Robinson, the BBC's Political Editor, spoke on the Today programme and posted an article on his blog in which he offered the opinion that "Gordon Brown no longer appears to be under threat". By the end of the day he was forced to retract his remarks and admit that the curse of Robinson had struck, although in his defence he noted that his previous piece was "based on extensive conversations with critics and backers of Gordon Brown's at the top of the party" and that it now appeared that it was the "peasants" who were revolting.
The first peasant to show signs of unease was Siobhain McDonagh, the member for Mitcham and Morden and an Assistant Whip, who admitted that she had written to the General Secretary of the Labour Party requesting that nomination papers for a leadership contest be sent out, and that she was in favour of such a contest being held. She was sacked by the government later that day. It might have been possible to have dismissed her as just one unhinged Blairite who had decided to cause a little trouble, except that on the following day Joan Ryan, the member for Enfield North, a Vice Chair of the Labour Party and the Prime Minister's envoy to Cyprus appeared on BBC Radio 4's Today programme to confirm that she had also "written to the party and asked for nomination papers to be issued" and that she too was calling for a leadership election in which she hoped a "multiplicity of candidates" would take part. She too was sacked.
Indeed the call for Labour party officials to issue nomination papers so that a leadership election could be held was soon endorsed by a variety of Labour Members of Parliament including Janet Anderson (Rossendale and Darwen), Jim Dowd (Lewisham West) and Graham Stringer (Manchester Blackley) who were also joined by former ministers such as Fiona Mactaggart, George Howarth, Kate Hoey and Frank Field.
There was also the little question of what the Daily Mail referred to as Pollygate. It so happened that the Guardian journalist Polly Toynbee, cheerleader for what some people like to think of as the progressive chattering classes, and a onetime enthusiast for Gordon Brown, had delivered an extraordinary diatribe against her former hero on the 6th September in which she claimed that the "smell of death" surrounding the government was "overpowering". Within forty-eight hours of the publication of this piece, a copy was anonymously despatched to every single Labour MP through the internal mail system at the House of Commons. The government apparently suspected that one of their own was responsible, and the party whips were conducting an investigation to identify the culprit. All of which was perhaps indicative of the sense of panic that now threatened to engulf the Party.
A New Civil War
The Sundays reacted to news of the events of the previous couple of days with headlines such as 'Labour in civil war as rebels attempt to remove Gordon Brown' (Sunday Telegraph), 'Labour rebels break ranks to demand Brown faces contest' (The Observer), 'Ex-ministers join Gordon Brown rebellion' (Sunday Times), 'Another damp squib, or the start of a real challenge?' (The Independent on Sunday) and 'Knives sharpen for Gordon Brown' (News of the World). The Sunday Mirror ran with 'Labour crisis: Prime Minister Gordon Brown targeted by five Cabinet rebels' and named the rebels in question as being Jack Straw, Geoff Hoon, Alan Johnson, Harriet Harman and David Miliband, although in truth, there was no sign of any of these five breaking cover, although the Sunday Express ran the story 'Heads roll as Brown battles for survival' and claimed that they had found a "senior Labour source involved with the plotters" who claimed that "90 per cent of the Cabinet also wanted Mr Brown to go".
The News of the World ran short statements from both Siobhain Mcdonagh and George Howarth, the member for Knowsley North and Sefton East, in which Siobhain insisted that "we can't afford to sleepwalk to electoral defeat" and the latter claimed that "the country simply cannot afford to sleepwalk into a Tory government" and urged Brown to "give somebody else a chance". The Mail on Sunday ran an article by Graham Stringer in which he stated that "we must now have a leadership election" whilst the Sunday Times ran a piece by Barry Gardiner the member for Brent North who claimed that the "public has stopped listening to Gordon Brown" and made a similar call for a leadership election. On the Monday it was reported that Gardiner, who held the position of the Prime Minister's personal envoy on forestry matters had been sacked by "mutual consent", although Gardiner insisted that he had in fact resigned on the Saturday 13th September, but he nevertheless became the third member of government to depart from office in protest at Brown's alleged failure of leadership.
Now whilst Ms Ryan had insisted that there was no "plot or a conspiracy", the similarity of the language used by many of the rebels in voicing their protest together with the extraordinary co-incidence in timing suggested otherwise. Indeed most of the press would have concurred with the Mail on Sunday when it referred to "a highly orchestrated assault" by "factions of the Labour Party", as did the government itself with a "Downing Street source" claiming that "Their plot is doomed. They just haven't got the numbers to force a challenge."
Of course there remains the question of why this all suddenly blew up at the time that it did. Frank Field claimed that some of Brown's supporters had leaked the story to the press in order to "smoke out the rebels", some suggested it was the plotters themselves who had done the deed, having become "furious" at the remarks made by Nick Robinson on the Today programme that the threat to Brown had disappeared, whilst others, or at least Guido Fawkes, alleged that it was disaffected staff at Labour Party HQ who'd spilled the beans.
The Labour Party Rule Book
Whilst the clear aim of the rebels was to unseat Gordon Brown, it must be said that removing someone from the position of Leader of the Labour Party was easier said than done. As far as the Labour Party rulebook is concerned it had the following to say on the subject;
Chapter 4 rule B (ii). Where there is no vacancy, nominations shall be sought each year prior to the annual session of party conference. In this case any nomination must be supported by 20 per cent of the Commons members of the PLP. Nominations not attaining this threshold shall be null and void.
Chapter 4 rule D (ii). When the PLP is in government and the leader and/ or deputy leader are prime minister and/ or in Cabinet, an election shall proceed only if requested by a majority of party conference on a card vote.
The procedure therefore appeared straightforward; find someone willing to challenge the incumbent, then find seventy-one members of the Parliamentary Labour Party willing to nominate that person, and finally convince the party conference that there should indeed be a contest.
The problem faced by the group of Labour rebels that emerged over the weekend of the 12th-14th September was that firstly they didn't appear to have anybody specific in mind to replace Gordon Brown, and secondly they didn't have sufficient numbers to nominate anybody even if they had that someone selected. It therefore all boiled down to a dispute over differing interpretations of the Labour rulebook. The rebels appeared to have seized on the requirement that "nominations shall be sought each year", as there was a time when the Party sent out nomination papers to MPs every year prior to the conference, and they now wanted the Party to resume this practice in the apparent hope that a large number of MPs would fail to nominate Brown. This they believed would be interpreted as a vote of no confidence in the leader, providing the necessary encouragement for someone, such as David Miliband perhaps, to break cover and openly challenge Brown thereby precipitating his downfall.
The trouble was that Ray Collins, the General Secretary of the Labour Party decided that it would not be appropriate to send out nomination forms, indeed it was also suggested by some newspapers that Gordon Brown had issued strict instructions to this effect. In any case the decision that was endorsed by a meeting of the National Executive Committee held on Tuesday 16th September, and whilst there was talk that the rebels were considering legal action to force the distribution of nomination papers and had even sought the advice of Charles Falconer, the former Lord Chancellor, on the subject, there was no sign of any such legal action.
Things duly get worse
Unfortunately recent history has shown that whenever it appeared that things could not surely get any worse for Gordon Brown, they promptly went and got worse.
On the Monday evening the BBC claimed that what it described as a "senior minister" was "ready to quit over concerns about Gordon Brown's leadership". The unnamed minister was said to be "thinking very hard about resigning and was close to doing so". Then on the following day the Daily Telegraph claimed that David Cairns, the Minister of State at the Scotland Office, was on the brink of handing in his resignation. However it also said that he was not the "unnamed minister" who'd talked to the BBC and that "up to three ministers were preparing to resign in protest", a contention that was also supported by The Guardian. By Tuesday afternoon Downing Street confirmed that David Cairns had indeed resigned, whilst Cairns himself issued a statement in which he explained that he believed that "the time has come to take the bull by the horns and allow a leadership debate to run its course", and that he had therefore concluded that the "only honourable course of action left open" was to resign.
It was duly noted that David Cairns had once worked for Siobhain McDonagh as her researcher, and that he was only able to sit in Parliament partly thanks to her efforts in persuading the government to remove the bar on former catholic clergy from so doing. The obvious conclusion was that his resignation was simply the next stage of the "highly orchestrated assault" against Brown.
Of course losing an Assistant Whip, a Minister of State and two personal envoys was not quite the end of the world, and Gordon Brown might well have been more concerned about the potential loss of yet another bank as HBOS began to show signs of struggling with the refinancing of its £200 billion plus mortgage book. Nevertheless what The Times referred to as "the wreckage of the most traumatic 72 hours since Gordon Brown became leader" had succeeded in completely overshadowed Brown's attempt at an autumn fightback, as the Labour Party appeared to have decided that now was the time to squabble amongst itself. Only a few voices were to be heard warning the Party of the possible consequences as John McDonnell remarked that it was "like watching the crew having a punch up on the deck of the Titanic", and Margaret Beckett warned that the "British people will neither understand nor forgive a party that appears to be more concerned with its own internal disputes than with their very real problems".
To underline the position the government found itself in, on the 18th September Ipsos MORI announced the results of its latest monthly poll which had been conducted between the 12th and 14th of September, and showed the Liberal Democrats on 12%, Labour on 24%, with the Conservative Party registering a truly impressive 52%.
The Week the Banks Fell
The 15th September 2008 soon earned itself the name of Meltdown Monday as Lehman Brothers bit the dust and filed for Chapter 11 bankruptcy protection, the American International Group was effectively nationalised, whilst the Bank of America agreed to takeover a rather beleaguered Merrill Lynch. Over in Britain things were little better as there were questions over the viability of the Halifax Bank of Scotland, commonly known as HBOS, given that it had £156 billion of debt maturing over the next year that it was struggling to refinance. On Thursday 18th September Lloyds TSB announced an agreed 'rescue' takeover of HBOS and saved it from apparent disaster. Gordon Brown immediately claimed some of the credit for the deal, although "banking sources" said that "it would have happened if the government had not existed".
It was also on the Thursday that the US government announced the creation of a $1 trillion 'toxic bank' which would sweep up all nation's toxic housing debt and so rescue the financial system from total collapse. World stock markets reacted with joy at this news, and the FTSE 100 shot up 8.84 per cent on the Friday, being the biggest rise daily rise the index had seen since it was created in 1984.
Apparently the effect of all this financial turmoil was to convince the Labour rebels that perhaps this was not the best time to be seen to be destabilising a serving Prime Minister struggling to safeguard the nation during a time of acute economic crisis, and so their rebellion was put on hold as they feared that perhaps success would be even more damaging to the party's cause than failure. Brown circulated a letter to each member of the Parliamentary Labour Party on the 19th September in which he promised to "restate the case for our party and our values" whilst insisting that "we can come through this difficult time". And when he duly appeared at the opening of the Labour Party conference in Manchester on Saturday the 20th September, the faithful put on a show of support, as he was greeted with cheers and a standing ovation that lasted thirty-two seconds; and in these times of trouble every second does indeed count.
Brown therefore appeared to have found a place of safety within the global storm that was hitting the financial markets, and his position therefore appeared secure, at least until the result of the Glenrothes by-election was known, or the next disaster came along.
- Nicholas Watt, Economy at 60-year low, says Darling. And it will get worse, The Guardian, Saturday August 30 2008
- Jenny Booth, Brown announces stamp duty holiday in housing rescue package, The Times, September 2, 2008
- Ensuring a fair housing market for all, Published 2 September 2008
- James Kirkup, Gordon Brown should shape up or 'go with honour,' Charles Clarke says, Daily Telegraph, 04 Sep 2008
- Andrew Porter, Gordon Brown 'cautiously optimistic' about economic future despite Alistair Darling claim, Daily Telegraph, 05 Sep 2008
- Polly Toynbee, Unseating Gordon Brown may be Labour's last chance, The Guardian, September 6 2008
- Brown unveils £910m fuel measures, BBC News, 11 September 2008
- Jason Lewis, Whips launch witch-hunt over ‘Pollygate’ email sent to every Labour MP, Daily Mail, 13th September 2008
- Simon Walters and Glen Owen, 'It's the beginning of the end for Brown' as rebels line up to knife him, Daily Mail, 13th September 2008
- Graham Stringer 'It is time to say what most MPs think', Mail on Sunday, 14th September 2008
- Minister 'set to quit' over Brown, BBC News, 15 September
- James Kirkup and Andrew Porter, Barry Gardiner latest MP to be sacked for plotting against Gordon Brown, Daily Telegraph,
15 Sep 2008
- Andrew Grice, Labour rebels call truce in their attempt to oust Brown, The Independent 20 September 2008