Leading Article: Labour starts off with slippery leadership

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"The idea that we have changed our policy is completely wrong," Gordon Brown reassured radio listeners yesterday. The Labour Party has always been totally in favour of privatisation, ever since anyone can remember. Or, at least, ever since last Thursday, when the Shadow Chancellor was caught out in a different interview on the subject of what he would do to plug the pounds 2.5bn gap in the public finances currently filled by notional privatisation receipts in years two and three of the next government.

Of course, he could not give the truthful answer, that pounds 1.5bn in one year followed by pounds 1bn in another is a trivial sum in relation to the huge numbers tracked forward by the Government's tax and spending plans. Nor could he point out that the plans for the next two years, to which he has signed up, depend on a range of other unrealistic assumptions which are likely to put enormous pressure on him to raise taxes or maintain high borrowing if he steps into Kenneth Clarke's Hush Puppies.

Nor could he, in truth, sustain last Thursday's line, which was that there was a pounds 1.5bn hole in Mr Clarke's finances too, because the Tories had not specified which sell-offs would fill it.

What was wrong with yesterday's about-turn on privatisation, however, was not the fact of it, which is a welcome development, but the timing, which exposed the miserable, defensive me-tooism of New Labour.

Mr Brown's attempt to claim that the manifesto pledge of a "review" of public spending meant that Labour was already committed to selling off the last few bits of the family silver, and then auctioning the family bronze, wood and bric-a-brac, was transparent. The idea of compiling a "National Inventory" of public assets is as see-through a gimmick as the campaign has yet produced. Under Conservative plans to bring in "resource accounting", government departments are already well advanced in valuing all assets in the public sector - in particular the land and property which is the last area for substantial money-raising privatisation.

The Independent has, unlike the Labour Party, been in favour of privatisation since before last Thursday. We have been critical of the way some sales have been handled, and of the fact that Tory governments have relied on sales to flatter the nation's annual accounts. But the principles, of getting the state out of trading activity and of subjecting the provision of public services to the "enterprise of the market and the rigour of competition", are absolutely right.

What is perhaps most depressing about yesterday's U-turn is that Mr Blair and Mr Brown think so too. That last phrase is taken from the new Clause IV of Labour's constitution, which is a cut-and-paste compromise between their "modernising" views and John Prescott's traditional wording. That same long sentence continues with the tortured doublespeak: "... where those undertakings essential to the common good are either owned by the public or accountable to them". The meaning of which is as flexible as a piece of string.

We know what Mr Blair thinks about privatisation, but after nearly three years as leader the policy has not been sorted out. It is not as if the timing of this election has taken him by surprise. And it is not as if this issue is new: Mr Blair was asked exactly the same question about privatisation receipts on Election Call in 1992. He did not answer it then. This time he has been forced to, but by the Tories in the middle of an election campaign. That is not leadership.

It is the same with a specific instance of privatisation, the railways. The promise of a "publicly owned, publicly accountable railway" has been quietly dropped from the manifesto. It was not a good promise, being extracted from Mr Blair by the trade unions at the 1994 Labour conference, but it was in the draft manifesto put to the membership and endorsed. So much for the "biggest exercise in party democracy ever carried out". So much for leadership.

It is the same with Scotland. The policy has not been thought through. Mr Blair is in the silly position of giving a Scottish parliament powers he patently does not think it should have. Would it not have been better tactics, let alone what was right and democratic, to have said that Labour would not stand for the Scottish parliament on a policy of putting up tax, but that varying Scottish income tax in future would be a matter for the Edinburgh parliament? That would have been leadership.

Labour had a poor campaign in the first week of real battle. John Major is waging an effective guerrilla war as leader of the opposition, and the policies of the nearly-government are looking frayed already. The role reversal means Tory policy is not examined as closely as it might be. Michael Portillo, trying to embarrass Labour on privatisation receipts, cited the London Underground sell-off, forgetting that the Government has pledged to put all the proceeds back into investment.

But it is Labour's slipperiness that is worrying. Mr Blair's pitch is, above all, to offer leadership. One of the Prime Minister's most damaging traits has been his repeated attempts to get tough, lay down the law, insist he will not be moved - before being driven off course by the pressure of public opinion or events. If nothing else, Mr Blair seemed to offer better. But leadership seems to mean being resolute about not having any policies; determined to minimise the differences between the two main parties. "Thatcher without the Thatcherism," grumbled an anonymous Cabinet minister yesterday. There is, despite the carping, much in Labour's manifesto to commend it. But at this rate how much will be left by polling day?