Steve Richards: Gordon Brown has found problems will only erupt by remaining silent about tax policies

There is no longer the scope to raise money to pay for what voters fear is a big black hole

Share
Related Topics

It had to happen one day. Silence could not persist for much longer. The issue of tax returns to torment Labour. In different ways tax connects the continuing threat of a fatal rebellion over the budget, Frank Field's various outbursts against Gordon Brown, potential policy solutions being offered by dissidents and the familiar soap operas being played out in various memoirs, all of them written with a lucrative serialisation in mind.

After the trauma of losing the 1992 election Labour ceased to debate the issue of tax and spend, or was not allowed to do so. As shadow chancellor Mr Brown pronounced that the divide between high and low taxation was over. Instead he argued with a convenient evasiveness that the new dividing line was between fair and unfair taxes. We have had few public proclamations from anyone since. Gradually Mr Brown's strategy became clearer and was at first highly effective. In a country that wanted low US levels of taxation and high European standards of public services, Mr Brown taxed stealthily. After a time, though, there were limits to the strategy. He became famous for his stealth taxes, a contradiction in terms that was not sustainable. Mr Brown also cut taxes every now and again, "affordable tax cuts" he called them. In particular, from the perspective of his 1980s mindset, Mr Brown remained obsessed with cutting the basic rate of income tax.

The voters had become less preoccupied, not noticing when the Chancellor cut the basic rate in the first term and when he did so again in his final budget before his elevation to the thorny Prime Ministerial throne. Even now Mr Brown says in interviews that he has achieved cuts that a Conservative government never managed, as if the current brickbats will turn to 1980s style applause. Instead in complicated ways the debate, or non- debate, has moved on.

While Mr Brown has shaped tax and spend policies, sometimes with a strategic brilliance that is forgotten in the current hysteria and sometimes with a clumsy plodding awkwardness, there has been more or less silence. Look back at Labour conferences over the last 10 years or so and there was nothing on this pivotal policy area.

In the silence Mr Brown has remained opaque at best on the subject, probably regarding it was too toxic for much public reflection. Yet silence does not mean the issue goes away.

The row over the abolition of the 10p rate is the most potent example. If Mr Brown had been a bit more open about his pragmatic approach to taxation the calamity might have been avoided. There is a partial defence for his final budget as Chancellor, which is that in order to maintain support for alleviating poverty it is necessary sometimes to give help to middle income earners. The 10p starting rate of tax was a separate expensive measure for helping the poor which was necessary early on before the tax credits took effect. Now there is a stronger case for targeting limited resources.

By instinct Mr Brown has been an advocate of targeting. On the whole Mr Field is an opponent, although he supports the abolition of the 10p starting rate. Mr Field has never forgiven Mr Brown for blocking his welfare reforms in the early days. In fact Mr Brown did so with the full support of Mr Blair. I recall Mr Blair telling me in great detail why Mr Field's ideas were unaffordable. But Mr Field's venom has been directed always at Mr Brown, sometimes with good cause and sometimes not.

Now Mr Field is no longer the impotent tormentor, but a dissenter with troops and a cause. He must recognise that addressing the losers from the abolition of a tax rate without dismantling the entire budget, and making sure that there are no new losers, is a nightmarish task. But on he goes demanding that a package is produced quickly, reflecting on Mr Brown's psychological flaws, getting revenge. Mr Field says that Mr Brown looks miserable. Mr Field looks as if he is enjoying himself.

But Labour's early very tough limits on tax and public spending meant that his welfare reforms were always doomed. I doubt if revenge plays much of a role in the thinking behind the authors of various memoirs being serialised this week. What played in their minds as they wrote their words was the need to get those lucrative serialisations.

In each case the publisher would have insisted that there was a meaty chunk on Blair and Brown. Cherie held back but wrote enough to get a few headlines. John Prescott put more of the blame on Mr Blair, but wrote enough about Mr Brown to wound. Lord Levy did the same.

If there had been meaty debates over the last 10 years about the direction of policy, publishers might have been interested in more than the soap opera. If Mr Prescott had been given a more substantial budget to make the trains run on time, if Cherie and Lord Levy had witnessed more dramas over policy, the soap opera would matter less. As it was the key debate in politics, "tax and spend", was neutered and a soap opera filled the vacuum.

Inevitably because it matters so much, dissenters are moving on to this terrain, like prisoners escaping from darkness and getting used to the light. The former minister, Stephen Byers, argued in his article this weekend that there is a case for more earmarked taxation. Charles Clarke has made the same point. Both are on to something big.

There is no longer the scope to raise money to pay for what voters fear is a great big black hole in to which their earnings will disappear. There is still some hope that voters will support taxes or mechanisms aimed to bring about direct improvements in the quality of their lives.

The different debates about paying for the NHS, pensions and caring for the elderly show it is almost possible to instigate reasonably mature discussions about how we pay for what we need.

There needs to be more of it. In the 1990s Paddy Ashdown came up with my favourite soundbite: "No taxation without explanation". Mr Brown has sought to tax without people noticing, let alone feeling the urge to explain what he was up to.

That era is over. So is the era in which "fair taxation" can be left so poorly defined. With some of the wealthiest paying little or no tax the principle needs modifying or changing altogether. Most obviously the very wealthiest should be taxed more.

The political landscape is changing, but as it does so there is an eerie familiarity. Like the early 1990s Labour is bewildered once more by the politics of tax.

s.richards@independent.co.uk

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Recruitment Genius: Online Media Sales Trainee

£15000 - £30000 per annum: Recruitment Genius: Now our rapidly expanding and A...

Recruitment Genius: Public House Manager / Management Couples

£15000 - £20000 per annum: Recruitment Genius: Are you passionate about great ...

Recruitment Genius: Production Planner

£20000 - £30000 per annum: Recruitment Genius: This fast growing reinforcing s...

Recruitment Genius: General Factory Operatives

£18000 - £35000 per annum: Recruitment Genius: This fast growing reinforcing s...

Day In a Page

Read Next
 

If I were Prime Minister: Every privatised corner of the NHS would be taken back into public ownership

Philip Pullman
 

Errors & Omissions: Magna Carta, sexing bishops and ministerial aides

John Rentoul
As in 1942, Germany must show restraint over Greece

As in 1942, Germany must show restraint over Greece

Mussolini tried to warn his ally of the danger of bringing the country to its knees. So should we, says Patrick Cockburn
Britain's widening poverty gap should be causing outrage at the start of the election campaign

The short stroll that should be our walk of shame

Courting the global elite has failed to benefit Britain, as the vast disparity in wealth on display in the capital shows
Homeless Veterans appeal: The rise of the working poor: when having a job cannot prevent poverty

Homeless Veterans appeal

The rise of the working poor: when having a job cannot prevent poverty
Prince Charles the saviour of the nation? A new book highlights concerns about how political he will be when he eventually becomes king

Prince Charles the saviour of the nation?

A new book highlights concerns about how political he will be when he eventually becomes king
How books can defeat Isis: Patrick Cockburn was able to update his agenda-setting 'The Rise of Islamic State' while under attack in Baghdad

How books can defeat Isis

Patrick Cockburn was able to update his agenda-setting 'The Rise of Islamic State' while under attack in Baghdad
Judith Hackitt: The myths of elf 'n' safety

Judith Hackitt: The myths of elf 'n' safety

She may be in charge of minimising our risks of injury, but the chair of the Health and Safety Executive still wants children to be able to hurt themselves
The open loathing between Barack Obama and Benjamin Netanyahu just got worse

The open loathing between Obama and Netanyahu just got worse

The Israeli PM's relationship with the Obama has always been chilly, but going over the President's head on Iran will do him no favours, says Rupert Cornwell
French chefs get 'le huff' as nation slips down global cuisine rankings

French chefs get 'le huff' as nation slips down global cuisine rankings

Fury at British best restaurants survey sees French magazine produce a rival list
Star choreographer Matthew Bourne gives young carers a chance to perform at Sadler's Wells

Young carers to make dance debut

What happened when superstar choreographer Matthew Bourne encouraged 27 teenage carers to think about themselves for once?
Design Council's 70th anniversary: Four of the most intriguing prototypes from Ones to Watch

Design Council's 70th anniversary

Four of the most intriguing prototypes from Ones to Watch
Dame Harriet Walter: The actress on learning what it is to age, plastic surgery, and her unease at being honoured by the establishment

Dame Harriet Walter interview

The actress on learning what it is to age, plastic surgery, and her unease at being honoured by the establishment
Art should not be a slave to the ideas driving it

Art should not be a slave to the ideas driving it

Critics of Tom Stoppard's new play seem to agree that cerebral can never trump character, says DJ Taylor
Bill Granger recipes: Our chef's winter salads will make you feel energised through February

Bill Granger's winter salads

Salads aren't just a bit on the side, says our chef - their crunch, colour and natural goodness are perfect for a midwinter pick-me-up
England vs Wales: Cool head George Ford ready to put out dragon fire

George Ford: Cool head ready to put out dragon fire

No 10’s calmness under pressure will be key for England in Cardiff
Michael Calvin: Time for Old Firm to put aside bigotry and forge new links

Michael Calvin's Last Word

Time for Old Firm to put aside bigotry and forge new links