The Prudence of Mr Gordon Brown by William Keegan

Inside the mind of a cautious Chancellor

The Chancellor attracts many clichés: prudence (who became Prudence, successor as fiscal pin-up to the Treasury Model); Calvinism (though predestination has played no part in Gordon Brown's anxious endeavours); and a relationship with Tony Blair variously seen as brotherly love, two-man bob and fatal embrace. So we needed William Keegan's book. It is not a biography but an intellectual history, rich in information, the only way of approaching this serious-purposed man.

For Keegan, Brown must be seen long-term. He has not stopped being a social democrat and is deeply mindful of poverty, his freeze on public capital spending part of a long strategy for winning City credibility before turning to redistribution and public services. Not so Tony Blair. Edward Balls, indispensable prompter of policy to Brown, hinted pre-1997 at bringing the higher-rate tax level back to 50 per cent. "Wash your mouth out," said Blair.

New Labour has always been a feardie-cat: afraid of middle-class wrath, of inflation, of what went wrong in the past; and, as Keegan puts it, "fear almost of themselves".

With fear goes cunning. Brown won credit for "setting the Bank free" over interest rates, but did nothing of the kind. An interesting sidelight is the warning of Sir George Blunden, a former deputy-governor, that independence would mean independence for one man. So Steady Eddie George did not get the Governor's writ which Montague Norman abused long ago. The Bank, while losing regulatory powers, shared independence with a committee of economists.

A fascinating chapter relates the nuances of each monthly meeting of the Monetary Policy Committee, refined expertise against refined expertise. It's nice to know that the Bank's own men were known as "the Politburo". But the committee pursued the Chancellor's norm and moved freely only between his limits: hardly independence, more like Home Rule.

Given the pressure of world conditions and the stability bequeathed by Kenneth Clarke, one wonders how much the MPC changed anything. One member, so bored as to start counting items on the flock wallpaper, confessed that, when asked, "I had no idea what they were talking about and could only say 'I agree with the Governor.' "

If the Bank was a success, public-service restoration looks unhopeful. Keegan rightly scouts nonsense about "a spending splurge" since 2001. But the Chancellor's pointless two-year submission to "Tory spending plans" was an overdose of soundness. Deadly figures show how low spending had fallen in the previous 20 years. As one official remarked, "We had been running bloody great surpluses and it was sensible to spend." When Brown finally indicated "Spend", the Treasury, as they freely admitted, did not know how.

Only 59 per cent voted in 2001. The complaint everywhere is of public neglect, of trains, hospitals and schools being ordered less well than in France. Yet the shift of message from rising prices to failing services, evident since the early 1990s, did not weigh with Gordon Brown. Despite his clenched dedication and social purpose, he risks being remembered as the man who looked through present discontents and slew dead dragons.

The reviewer's book 'Reform! the struggle for the Great Reform Act 1831-2' is published by Cape