Crisis puts 'safe hands' Darling back in spotlight

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Indy Politics

Unusually for a cabinet minister, Alistair Darling has taken a positive delight in keeping his name out of the newspapers. The man regarded as Labour's safest pair of hands was sent to both the social security and transport departments after they suffered the Whitehall equivalent of a nervous breakdown.

He is certainly making up now for his low headline count. Since becoming Chancellor in June, he has rarely been off the front pages. "It just hasn't stopped," a friend admitted yesterday.

Being Gordon Brown's Chancellor was never going to be easy. But Mr Darling could never have foreseen how difficult unexpected events would make it. As if the first run on a British bank for 140 years were not enough, Mr Darling is now having to defend what is probably the biggest breach of personal security details in Europe.

His torrid time as Chancellor was epitomised on Sunday, which he spent at his desk at the Treasury after returning from a meeting of finance ministers in Cape Town. Not only was he preparing his Commons statement on the Northern Rock crisis the following day, but he was receiving constant updates on the crisis engulfing HM Revenue and Customs (HMRC).

Insiders say Mr Darling kept a cool head and was decisive. One ally said: "He has been through fire before and he will come through it this time. In six months, we hope people will look back and think that no one lost a penny over Northern Rock or HMRC."

The Chancellor played the security breach totally straight, immediately ordering HMRC to call in the police when some officials wanted an internal investigation. He also played the politics straight. When the bad news broke, he took personal charge. Labour MPs contrasted his Commons statement yesterday with Mr Brown's decision to send his Treasury minister Dawn Primarolo into the Commons lion's den to defend the administrative chaos over his tax credit scheme.

Mr Darling, the 53-year-old MP for Edinburgh Central is more independent-minded than the caricature of him as a loyal sidekick in thrall to his master. He also does a good line in self-deprecating humour.

Yet "events" have made it very hard for him to make his mark as Chancellor. Mr Brown was heavily involved in the rescue plan for Northern Rock which Mr Darling announced in September. Friends say he carried the can for mistakes made by the Bank of England on the bank's crisis and his first major announcement, a combined pre-Budget report and government-wide spending review last month, was eclipsed by claims that he stole Tory tax policies. To make matters worse, a rethink over his decision to raise the minimum capital gains tax rate from 10 per cent to 18 per cent after an outcry from business appeared to be leaked by No. 10 without his knowledge.

The Tories are not yet calling for Mr Darling's head. But they put him on notice that they will do so unless he "gets a grip'" quickly.

His position is probably more secure than it looks because Mr Brown could hardly afford to lose the close ally who succeeded him at the Treasury, a move which would threaten his own reputation for economic competence. But ministers fear that a stain of incompetence may stick to the Government after a string of highly publicised blunders, including mistakes on the number of foreign workers and revelations that thousands of illegal immigrants work in the security industry.

The cumulative effect is dangerous for Mr Brown. It is true that his problems are caused by events largely beyond his control, rather than provoked by government policies – like the wave of strikes crippling France – but labels stick and can be very hard to shrug off.