Leading article: Stop the stunts and focus on social justice and improved public services


The more the Prime Minister insisted that he needed time to set out his vision, the less clear his vision became. Last weekend he announced there would not be an election because he wanted us to know better what he stood for. We might have expected him to set that out in his speech to his party's annual conference last month, but that workmanlike assembly of prefabricated sections was a little light on the vision thing. Last week, with Tuesday's big economic set piece, he had, through Alistair Darling, the chance to put that right. His vision turned out, in the cruel jibe of George Osborne, the shadow Chancellor, to be that of the Conservative Party.

It has been a horrible week for Gordon Brown. The only politician who had a worse week was Sir Menzies Campbell. After an impressive first three months, the Prime Minister has damaged his reputation in a way that was both unnecessary and self-inflicted. The pre-Budget report did not solve any of the problems thrown up by the indecision over the election that never was; rather, it made them worse. What Mr Darling unveiled – once we had waded past the selective statistics – was a worsening budgetary position. The British economy is still strong. Some of the heat may come off the housing market, and there may be a lessening in the pace of growth next year: those are both necessary corrections and the conditions of sustainable growth in the longer term. But the Government's finances are not where they should be in relation to the economy. Public borrowing is too high – after so many years of steady growth the Government should be paying back debt, not adding to it; it is higher than was predicted six months ago, and it is rising.

Against such a background, Mr Darling took a pigeon-step in the right direction, by raising taxes overall over the next few years, although it was by a trivial amount. What was less well judged were the two big tax cuts for the relatively well off. Doubling the threshold for inheritance tax on couples to £600,000 cannot be justified on grounds of social justice. David Cameron, whose already forgotten statement of values committed his party to judging every policy by how it helped the least well-off, was guilty of opportunism in advocating an even bigger tax break. Of course it is not fair that the very rich can avoid inheritance tax altogether by the use of discretionary trusts. The answer to that is to tax the super-rich more heavily in other ways, not to give a windfall gain to a few families that are actually just below the very top of the wealth range. Ultimately, inheritance ought to be taxed as income for the inheritor; that would provide a powerful incentive for the rich to spread their wealth more widely on death.

The other tax cut for the better-off was the reduction in capital gains tax on second homes. This was not copying Tory hypocrisy: in this case a Labour government seems to have managed to strike a blow against social justice without any prompting. At least Mr Darling was encouraged by Mr Osborne to do something about the relatively light taxation of private equity partners and "non-doms", which is in the interests of social justice.

Mr Brown now enters a critical period. He has to put a stop to the tactical positioning and the short-fix stunts before he suffers terminal political damage. He needs to focus on sound government and the solid delivery of incremental improvements in public services. The public liked what it first saw when he took over from Tony Blair. Now he should get back to work, and demonstrate a vision that promotes economic stablitity, environmental concern and social justice.

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