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

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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

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