Wednesday, 27 August 2008

No Way to Run a Government

It's not really news to report that Gordon Brown is deeply, truly, and quite incredibly unpopular. However, some think that a few policy revisions here, maybe a change of leadership there, and all will be well for the Labour movement. I'm beginning to wonder whether this is true, or whether the UK has (finally) begun to identify a systemic problem with New Labour.

A systemic issue, if one exists, would be one that manifests itself across a range of policies, and in order to be noticed it will have been apparent in a number of recent issues. So let's have a quick look back at recent arguments and issues where New Labour have not done too well.

Of course, the biggie is Northern Rock. If I recall correctly, there was a budding private sector rescuer in the form of Lloyds TSB, but Darling turned down their bid because it looked too expensive and then spent far more on rescuing the bank. Time then passed while he made up his mind as to what to do, by which point the damage to the business was done so no-one wanted it on his terms. So he had no choice but to spend even more and nationalise it.

Then there are the various suggestions that something is going to be done about Stamp Duty, in order to help the housing market. Of course, the natural and sensible reaction of those in the market to suggestions that there might soon be a relaxation of Stamp Duty is to hold on until things become clearer. So by letting it become known that things are being considered, but not saying what they are, New Labour has managed to stop the housing market stone cold ... in the name of helping it.

Car tax has be rumbling as an issue for quite some time. Announcements have been made about what the new rates will be, and they have been (on any measure) quite punitive in respect of quite ordinary cars. Now, in the light of the predictable adverse reaction, it has been leaked that there have been some second thoughts, and that something might be done about it. But, of course, in the meantime people have to get on with their lives. Decisions have to be made about whether to sell, buy, service and repair cars. All these decisions are contingent on the car's value; that (in turn) is dependent on the future rates of tax ... which are uncertain.

Some time ago, new rules for self-invested pension schemes (SIPS) were announced; investors would be able to add any asset they wished, such as a second home. This of course meant that you could buy a second home by the seaside for your pension plan, and only have to pay out 60% of its value, although when you used the home your pension plan would have to charge you a going rate for the use of the property. Many people made plans to use this opportunity; many reached an advanced stage of conveyancing including (I understand) the payment of deposits. Then, it was announced that too many people were planning to take advantage of this provision, so it would not be introduced as planned after all. Whatever you may think of the policy itself, this is no way to treat people.

Finally, we are now discussing a windfall tax. Apparently, it is just Labour backbenchers. Notably, they are not being told to shut up, and nothing is being denied. So, the energy companies who are the likely target must realise which way the wind is blowing, and if they have any sense they are putting money aside. The result of this is that money is being taken out of circulation; it is being neither returned to shareholders nor invested in the energy business. That is a loss to us all, caused directly by Brown's government.

So what is the common thread? In each case, it is the machinery of Government. No official decision is reached quickly or efficiently; there is always a long period of dither while the argument is allowed to run in public until a consensus is reached. Inevitably, it never is; such is the nature of political debate. Then, official decisions are only final decisions if the polls and the focus groups support them, so nothing can be (safely) relied on. No-one in government has the courage of their convictions; either they lack courage, or they lack any real political convictions.

This is where a decade of spin has led us to. A government that has no real set of core values; no ambition beyond power itself. Blair (at least) wanted to be Prime Minister in order to achieve his aims; Brown just wanted to be Prime Minister.

I can't help but remember an old criticism: "In office, but not in power".


  1. It is the "testing the water" aspect - whereby different proposals are leaked to the press to gauge their reaction first - which irritates me the most. As you say, if they had a clear set of values or ambitions they would tailor their policies using that as a starting point. They have not done this at all since 1997.

    The economy has been puffed up each time there has been a sniff of a slowdown meaning that now the final reckoning is upon us there is nowhere to turn.

  2. Any business person will tell you that the important thing is to make a decision.It often matters a lot less what the decision is, than that it is made.
    You can always alter it a bit later, but if you never decide then as you pointed out, a period of waiting, where nothing productive at all is done, commences.

    NuBrownLabour are particularly susceptible to U-Turn accusations after NR and 10p tax, stabbers to hospitals etc, and so feel the need to be 100% convinced of the polls before making an announcement.

    In practice, as hands are sat on, stuff just leaks out. The government, terrified it may not be focus group friendly or revenue raising or revenue neutral, has to deny anything is going on, even when the evidence is there to see, just in case a 180 is needed.

    Exactly as you point out, with no long term plans, and having survived for years on 'headlines' and 'spin' and reheating old news, every new policy appears to come straight from the pads of a brainstorming session.

    And it shows.