A serious scandal but not life-threatening to Labour

'If every politician who told fibs on the 'Today' programme had to resign, there wouldn't be many left'

The Ecclestone affair defined, six months after it had been elected, the Government's loss of innocence. New readers starting here may want to be reminded that in early November 1997 it was reported that the Government was seeking to exempt Formula One motor racing from the imminent EU ban on tobacco advertising. Then on the Thursday of the same week the reporter Tom Baldwin made his first call to Downing Street seeking reaction to what by any standards was a scoop and would rightly dominate the headlines from that weekend - that Bernie Ecclestone, the boss of Formula One, had donated £1m to the Labour Party five months before the election.

The Ecclestone affair defined, six months after it had been elected, the Government's loss of innocence. New readers starting here may want to be reminded that in early November 1997 it was reported that the Government was seeking to exempt Formula One motor racing from the imminent EU ban on tobacco advertising. Then on the Thursday of the same week the reporter Tom Baldwin made his first call to Downing Street seeking reaction to what by any standards was a scoop and would rightly dominate the headlines from that weekend - that Bernie Ecclestone, the boss of Formula One, had donated £1m to the Labour Party five months before the election.

As it happens, the Government may have been guiltier of naivety than corruption. No one will will ever know for certain how far, if at all, it was influenced by the donation - or the prospect of another one. But it was at least as persuaded by the dire - and in all probability wildly exaggerated - warnings by Ecclestone that all the ancillary production and design industries in southern England tied to motor racing would be wiped out if Formula One left Europe. The whole episode was the first decisive dent in the image that New Labour had clearly fostered of being somehow wholly clean in a way that the Tories had not been. Or at least it would have been had public opinion, in those still bright days of the Blair honeymoon, not been inclined to give him the benefit of the doubt.

One of the reasons that its resurfacing as a story damages the Government is that public opinion is no longer so inclined. More to the point, it is a reminder of the unsatisfactory nature of current party funding. Can we still be so sure that the taxpayer would not rather stump up the cash to fund the parties than leave it the Bernie Ecclestones of this world?

But that isn't the issue that has been galvanising the Government's opponents. Instead it is the fact that Gordon Brown said in an interview on Todaythe following Monday that he did not "know the true position" when he had discussed what to do about the donation with Tony Blair four days earlier.

Certainly there are no upsides in this story for either Gordon Brown or for the Government. Both have been damaged by it. If Mr Brown did dissemble, it was an exceptional case of his doing so. But there is also an element of poetic justice in that, if the Chancellor did mean to suggest that he was out of the loop - as his defenders insist he didn't - then it illustrates a particular fault, an occasional tendency to absolve or at least protect himself from decisions of the collective leadership when it suits him. How far up it falls on the Richter scale of political earthquakes, however, is another matter.

Several points need to be taken into account. Even if it was Mr Brown's proposal to seek advice in writing from Lord Neill rather than - as Alastair Campbell had suggested - to make a fairly clean breast of the donation there and then that carried the day with Tony Blair, he was hardly alone in suffering the striking candour bypass that afflicted the Government in the aftermath.

First, they were all, from the Prime Minister down, fully implicated in the decision. No one, including Mr Campbell, resigned over it. Second, neither Peter Mandelson, nor even the Prime Minister, were wholly frank in the television interviews they gave several days later, especially on the question of whether discussions on what to do about the donation had taken place before or after Mr Baldwin's enquiry.

Thirdly, both the basic facts in Andrew Rawnsley's lively account of these events in his new book Servants of the People have been in the public domain for more than a year. It's true that the remarkable quote, uttered among persons unknown, that Rawnsley attributes to Mr Brown about knowing he had lied is entirely new. It's true, too, that Mr Rawnsley's interpretative scoop has been to conjoin those two basic facts, namely that Mr Brown discussed the donation issue on what must have been a tense car journey with the Prime Minister back from the Anglo-French summit at Canary Wharf, and that four days later he gave his radio interview.

But if every politician who prevaricated - or even told fibs - on the Today programme had to resign, there wouldn't be many left. It is hard, therefore, to escape the conclusion that the aftershock would be a good less were the Government - and Mr Brown - not already beleaguered by the fuel crisis, the slump in the polls and a host of other woes. It wasn't in Parliament. If it was a deception, it was a personal one rather than one of state. And as such, it hardly measures up to the untruths about his personal life that President Clinton has consistently uttered with such impunity.

Fourthly, the issue probably makes rather greater waves in the beltway than it does outside it. Mr Brown is probably lucky that Parliament is not sitting. But that's precisely because the electorate at large - as opposed to the Westminster cockpit - is likely to be less energised to absorb all the details of this affair than those of other matters in which the Chancellor exercises a real influence over their lives - fuel duty being a vivid example.

This isn't at all to make light of the issue - or to suggest that it has a minimal effect on public opinion. In the round, the Ecclestone affair - and all the prevarications which followed it - made for a pretty awful contrast with New Labour's sanctimonious claim to be above the standards of other parties. The Downing Street aide who remarked, when I was researching the affair for my book on Peter Mandelson, that the Government had been lucky there was no US Special Prosecutor in Britain had a point. And the electorate is perfectly capable, to put it mildly, of grasping there was something pretty dodgy about the whole affair.

That said, it is unlikely to be the issue that decides the election or even dictates its timing. The question of whether Michael Portillo - apparently against his first instincts - has been wise to sanction a populist pledge to cut 3p from fuel duty is.

If the Chancellor has the huge surplus the Tories are predicting, then he has the opportunity to shoot their fox by outdoing them. If he hasn't, then they will have to find much deeper spending cuts than they allow for at present. But either way, the issue helps to define the coming election as one that will take place across a real divide between tax-cutting and quality public services. Even if the Tories, because of theirrecord, were not severely handicapped in making the election about character rather than policy, the issues would militate against such an approach.

It's true that no one would have predicted at the outset of the Westland affair that it would prompt Margaret Thatcher at one point to foresee her own demise. (It didn't happen.) But it's very doubtful that this falls into the same category. For one thing, there are now much greater issues at stake. The result of next week's Danish referendum on the euro, and how the man still virtually certain to be the British Chancellor come election time reacts to it, to name but one. But that's another story.

* d.macintyre@independent.co.uk