The Week in Politics: Why Michael Howard is getting under the Chancellor's skin

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What has upset Gordon Brown most in recent weeks? Tony Blair's decision to deny him a seat on Labour's national executive committee (NEC)? No. The predictions by City analysts that he will face a "black hole" in his spending plans and have to raise taxes again? Not much. What really got under his skin was that Michael Howard was voted Parliamentarian of the Year by The Spectator magazine.

Since 1997, Mr Brown had seen off four previous shadow chancellors - Kenneth Clarke, Francis Maude, Peter Lilley and Michael Portillo - who barely laid a glove on him. Before his surprise elevation to Tory leader, Mr Howard certainly landed some telling blows on Mr Brown, although it is rewriting history to say that he flattened the Chancellor.

None the less, Mr Howard's success was a rare blip on Mr Brown's utter domination of the economic scene since 1997. If he is still at the Treasury next June, he will overtake David Lloyd George to become the longest-serving chancellor in the past 100 years.

It is becoming a big "if", not because Mr Brown is about to be sacked or resign, but because there is growing speculation that he might have followed Lloyd George's path by becoming Prime Minister by then. The odds on that happening must have shortened in the past week thanks to Tony Blair's high-risk decision to turn next month's crunch Commons vote on university top-up fees into a vote of confidence in his leadership.

Mr Brown will be centre stage next Wednesday when he presents his pre-Budget report, one of the big set-piece occasions in the political calendar. This year the problems engulfing Mr Blair will give the occasion added piquancy. All eyes will be on Mr Brown as never before - not least those of Labour MPs.

The Chancellor has been a happy bunny since the summer, when he and his wife, Sarah, knew everything was going well with her pregnancy. Although he looked a pretty grumpy bunny when he did not get his NEC seat, friends and colleagues say that he is revelling in fatherhood. Not that it has cut his work rate, of course: officials have noted an increased appetite for hammering out newspaper articles and Mr Brown is beavering away on his statement at the Treasury this weekend.

Mr Brown will have genuine reasons to be cheerful when he addresses the Commons on Wednesday. His forecast in April that the British economy would grow by between 2 per cent and 2.5 per cent this year looked decidedly dodgy, but it is now coming good. Although borrowing will probably be higher than expected, the growth figures will allow Mr Brown to claim that the British economy is on track and doing better than its European rivals. He will argue that his cherished "golden rule" that the Government should only borrow for investment rather than current spending will not be breached, although some independent experts will doubtless dispute this.

Although he will probably not say it in so many words, the Chancellor's political message will be that he will not need to raise taxes further - at least this side of the general election.

What else can we expect? Father Brown will announce measures to improve child care to make it easier for mothers to work, which he will present as a key element in his personal crusade to abolish child poverty. Expect extra carrots for lone parents. There will also be the usual Brown battery of measures to boost enterprise and skills.

Housing will loom large in the coming week, with the publication of two important Treasury-ordered reports on the mortgage market and house building. For good measure, Mr Brown will float plans for tax breaks to encourage people to invest in the residential and commercial property market. We will hear a lot about what the Americans call "real estate investment trusts" in the next few years.

There is another reason why Mr Brown can afford a wee smile as he prepares for his big day. Whatever the outcome of Mr Blair's do-or-die battle with his own MPs over top-up fees, Mr Brown wins. If the Prime Minister survives the rebellion, it will be with the Chancellor's help. He will hit the phones and meet waverers ahead of next month's vote, just as he did before the big revolts over the Iraq war and foundation hospitals.

But on both those occasions, Mr Brown's private doubts were known, so he had an insurance policy if Mr Blair went under. The pattern is the same on top-up fees. A year ago, the Chancellor's preference for a graduate tax became known during a fierce cabinet battle over tuition fees. It is an alternative that many of the Labour rebels would prefer.

If Mr Blair wins, he will have scraped through and may be left weaker rather stronger, without the mandate he desires for further radical reforms such as compulsory pensions, a shake-up of housing benefit, road pricing and other "user charges" for those who can afford them.

There is an unmistakable whiff of change in the air at Westminster. It is no longer fanciful to imagine Mr Brown succeeding a broken-backed Mr Blair in the spring without a Labour leadership contest, mirroring the coronation of Mr Howard. I can't see anyone emerging as a serious challenger to the Chancellor.

Ever so discreetly, Brown footsoldiers signal to loyalist MPs that there would be no purge of Blairites from the Cabinet should Mr Blair fall. Some new faces in the whips' office, perhaps, where Nick Brown, currently leading the charge against top-up fees, would probably become the official chief whip instead of the Chancellor's unofficial one on the back benches.

When he delayed the top-up fees vote until after Christmas, Mr Blair remarked privately that "if you see a brick wall, you don't drive straight into it". His problem is that, in the eyes of many Labour MPs, that is precisely what he is doing.

a.grice@independent.co.uk

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