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May 8th, 2008

The Labour party rule that allows for a cabinet coup

gordon-brown-at-conference.JPGThere is one huge roadblock to any future leadership challenge to Gordon Brown: any challenger would need the backing of a fifth of MPs to trigger an election. This restriction is a big reality check to those speculating that Mr Brown’s position is in danger.

But, as someone pointed out to me recently, this is not the only way that Mr Brown could be deposed. There is a Labour rule that would allow for a change of prime minister without the immediate need for a party leadership election. It is effectively the “silent coup” clause.

If the cabinet joined forces and convinced a serving Labour prime minister that his time was up, he would become “permanently unavailable”, in the words of the party rule book. The cabinet, “in consultation with the NEC”, would then be able to anoint a new prime minister “until a ballot…can be carried out”. An election is not immediately triggered: the cabinet could decide to “leave the post vacant until the next party conference”.

There appears to be the wiggle room in these procedures (which I have pasted below) to put off an embarrassing leadership election until a general election — if the cabinet were united.

Clearly there are some massive qualifications to this fantasy politics. Can you imagine Mr Brown stepping down that easily? Or the cabinet acting acting in unison? And how bad would things need to get to convince the cabinet that appointing a doubly unelected prime minister would be wise? All highly unlikely. But it is always worth knowing the rules of the game.

4B.2e Procedure in a vacancy

(i) When the party is in government and the party leader is prime minister
and the party leader, for whatever reason, becomes permanently unavailable,
the cabinet shall, in consultation with the NEC, appoint one of its members to
serve as party leader until a ballot under these rules can be carried out.

(ii) When the party is in government and the deputy leader becomes party
leader under (i) of this rule, the Cabinet may, in consultation with the NEC,
appoint one of its members to serve as deputy leader until the next party
conference. The Cabinet may alternatively, in consultation with the NEC,
leave the post vacant until the next party conference.

May 4th, 2008

Introducing…the favourites to become Labour’s new general secretary

Labour’s national executive committee are meeting again this week to revive the search for a new general secretary to replace Peter Watt - who quit last year after the David Abrahams proxy donations controversy.

On Friday the party slipped out the news that David Pitt-Watson, the City fund manager who was poised to take the job, had walked. The founder and chairman of Hermes Equity Ownership Services was concerned about potential liabilities from taking up the job at a time when Labour is about £20m in the red.  

There is speculation that Mike Griffiths of Unite - who was pipped to the post by Pitt-Watson - could stand again.

But my understanding is that the unions are trying to secure a more consensual figure and have Keith Sonnet, deputy general secretary of Unison (now part of super-union Unite), lined up. If you want to know more about him here is a link.

Another frontrunner is likely to be Ray Collins, a senior figure in the Transport and General Workers Union (also part of Unite).

May 1st, 2008

What did Rupert and Gordon discuss at the Waldorf?

waldorf.jpgOne key part of Gordon Brown’s trip to the US has until now remained a secret: the prime minister caught up with Rupert Murdoch.

The meeting, held in Mr Brown’s suite at the Waldorf Astoria in New York, lasted about half-an-hour. We’re not sure what they chatted about. But the timing of the get together should give us a clue.

Mr Brown’s meetings with the media tycoon have begun to synchronise with the electoral calendar — they met at Chequers last year just before the prime minister decided against calling a general election. Mr Brown is probably wishing he could delay today’s local elections too.

One wonders whether Mr Murdoch already knew that his stable of UK papers would back a Tory candidate for London Mayor (you can read the endorsements here, here and here). Whether he told Mr Brown that The Sun and The Times were deserting him, at least for now, was probably irrelevant. I’m sure Mr Brown got the message.

Those who have worked with Mr Brown say he pays incredibly close attention to how the papers cover him — much closer attention than the average reader. The mayoral result on Friday may well reinforce his theories about the power of the press. More seasoned observers of Mr Murdoch’s career may well see it as another example of how seamlessly he moves with the prevailing political winds.

April 29th, 2008

Gordon Brown’s fondness for round troop numbers

British soldiers must be feeling a little dizzy. Gordon Brown has made some big promises to them about troop numbers in Iraq, which have invariably proved inaccurate. Remember the 1,000 troops home for Christmas? And the halving of British troops serving in Iraq to 2,500 by the Spring? Ministers have either done some creative work on definitions of “home” or blamed changing conditions on the ground. But, from what I have been told, it has as much to do with the prime minister’s penchant for round numbers.

Mr Brown’s role in the “1,000 home for Christmas” has been well reported. The catchy announcement was made without consulting the Ministry of Defence. There was then a scramble to work out how the pledge could be met. In the end, about 500 support troops sent to Kuwait were defined as being out of Iraq and therefore “home”.

Mr Brown’s role in the setting the 2,500 target for the draw down in Iraq is less well known. Again, he delivered a catchy message (this time in the Commons in October): the British presence in Iraq would be halved by the Spring. The number was chosen “after detailed discussions with our military commanders, a meeting of the National Security Committee, [and] discussions with the Iraqi Government and our allies”, according to Mr Brown.

But since then, British officers have concluded there must be at least 2,800 men to be able to protect the base adequately. So even when the withdrawal resumes, we are unlikely to hit the magic 2,500 number. The rounding error had more to do with Downing St than inaccurate military plans, according to one defence insider. Another official suggested to me that the low number risked upsetting officials in the US and losing Britain any benefits, in terms of the special relationship, it has derived from taking part in the war. “They can be rather unforgiving”, the official said.

April 25th, 2008

Will the 10p losers be waiting for compensation cheques until October 2009?

Forget affordability. The toughest problem facing Treasury officials may be finding a way to make timely payments to some of the 5.3m households that are set to lose out from scrapping the 10p rate.

The rub is that if officials choose to keep Gordon Brown happy by using his cherished tax credits system, the lucky losers identified for compensation may be waiting for up to 18 months for their backdated cheque. This would coincide with the much heralded plans to raise the minimum wage, which will not come into force before October 2009.

I’m not convinced voters will be understanding about such a long wait.

Here is why it could take that long. The tax credits system is cumbersome and hard to manage. It works on an annual basis and is fiendishly difficult to adjust mid-year in any significant way. Monthly payments are set at the start of the financial year in April. A process of “reconciliation” then takes place in September, where overpayments and underpayments are calculated. (About 2m families are told at this point to give money back to the government because they have been overpaid. Great politics.)

A best case calendar for extending tax credits to those low-paid workers without children would look like this:

  • November 2008: Alistair Darling announces the changes
  • Jan/Feb/March 2009: People apply for tax credits for 2008 (effectively backdated payments) and 2009
  • April 2009: Monthly payments begin that compensate for both the 2008 and 2009 financial year

A more realistic scenario was outlined to me by Ian Mulheirn of the Social Market Foundation, who wrote an excellent review of the options available to the chancellor.

“Amending the tax-credit system to assist these people would only take effect from April 2009 and any backdating in respect of 2008 would probably take another six months,” he told me. Basically, the backdated payments for 2008 would be calculated when it comes to “reconciling” the tax credit payments in September 2009.

This would effectively mean that even those lucky few chosen to receive compensation would be out of pocket until October 2009.

Is that a message that will win votes on the doorstep?

A far simpler and much quicker alternative, advocated by the Institute for Fiscal Studies, is to increase income tax allowances, a measure Gordon Brown has criticised in the past because it is more regressive than tax credits. Changing the income tax schedule was not mentioned by the Treasury in its letter outlining the 10p rate U-turn.

The question is: will the prime minister swallow his pride and admit that tax credits are not the best solution to his compensation puzzle?

April 23rd, 2008

NEWS FLASH: Government U-turn on 10p tax rate

The U-turn is already happening. Apparently Gordon Brown will - in Prime Ministers’ Questions at noon - announce compensation (backdated!) to those affected by the removal of the 10p tax rate.

Good news for poor workers.

Bad news for the government’s reputation: it’s the Treasury’s third U-turn in as many months.  

Expect David Cameron to have a field day in a few minutes’ time in the Commons.

April 23rd, 2008

The Field rebellion gathers strength

Frank Field has now gathered 45 Labour names for his amendment to the finance bill - which would provide compensation to those hammered by the abolition of the 10p rate.

At this rate the rebel former minister looks increasingly likely to defeat the government.

This morning we wrongly wrote that - having claimed 39 names yesterday morning - the list was down to 31.

Simple explanation: Frank’s spokesman left a message on my phone last night with the wrong number. Today he apologised for confusing 31 (rebellion losing steam) with 41 (rebellion gathering steam). Ahem. We’ve all been there.

Gordon Brown is now under pressure to pull a more convincing rabbit out of his hat this week.

These are the MPs who joined the revolt overnight.

Kelvin Hopkins
Jim Hood
David Chaytor
Bob Marshall-Andrews
Rosemary McKenna
Hugh Bayley

Mark Durkan (SDLP)

April 22nd, 2008

Why didn’t Labour MPs read their own Budget?

It has taken a year for many Labour MPs to notice that the headline cut in income tax from 22p to 2op came at a cost - the abolition of the 10p band.

That seems pretty embarrassing. Bear in mind that the headlines - the day after the 2007 Budget - focussed on this sleight of hand.

No surprise then that one MP, at Monday night’s meeting of Labour backbenchers (the PLP) got his sums confused. It was wrong, argued the person (Tom Levitt apparently) that MPs would each be £1,000 better off while poor workers suffered. The sum was totally erroneous - being his application of the 2p cut to his entire salary. D’oh.

Meanwhile someone tells me that posters were made a few years back, declaring the greatest achievements of the Labour regime: among them the introduction of the 10p band. Apparently John Prescott still has the posters in his office. But is the 10p one still there?

One wag suggests that supplementing the 1 for a 2 would solve the problem.

Rightly MPs are worried that the issue is going to bite them at next week’s local elections. Apparently the Tories have already drawn up material showing how much worse off different types of workers are going to be.

April 17th, 2008

Someone you may not have heard of might be going

Angela Smith MP. Never heard of her before. Maybe you have. Anyhow, apparently she is threatening to leave the government over the abolition of the 10p income tax bracket.

Given her relative anonymity* - feel free to disagree - this isn’t a massive blow to Gordon Brown.

It would have been more exciting if it was the other Angela Smith MP, who is Parliamentary private secretary to the prime minister.

Still it isn’t great news given the brewing backbench dissent over the issue.

(*She is/was pps to Yvette Cooper, chief secretary to the Treasury)

 UPDATE:

Smith has just told me: “No comment”. But she has told friends that she could be about to resign. Tomorrow seems likely.

LATEST UPDATE:

She has changed her mind. After a chat with the PM. Not the most impressive of rebellions.

  

April 14th, 2008

Is Britain the 51st state?

The idea has been raised before - in relation to our foreign policy and our economic reliance on the US.

No wonder then that the 10 Downing Street spokesman said this morning that “we were the fastest growing country in the US last year”…..before correcting himself…..”sorry, the G7″.

At the same time, Gordon Brown watchers are likely to have a field day this week as they watch the prime minister on a crucial trip to New York and Washington. The body language with “Dubya” has not seemed great, as seen in the picture below.

Meanwhile check out The Times on how the visit could be overshadowed by the pope.


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