Labour's bloodhound tracks the city fat cats

Politics/ digging the dirt

UNMASKED! The tormentor of British Gas chief Cedric Brown and his fellow "fat cats" in the privatised utilities is a 27-year-old economist who has just finished reading I, Claudius and, not surprisingly, hates John Major's government.

Nick Vaughan, born the son of a doctor in Papua New Guinea, is Labour's most closely guarded political secret weapon. He only joined the Opposition economic secretariat six months ago, but his investigations have already split the Cabinet over top people's pay, and in a leaked letter to the Prime Minister last week Michael Heseltine warned of more damaging "causes celebres" right through the summer.

The President of the Board of Trade is right to be nervous. Crop-haired Vaughan, who learned the politics of utilities at the sharp end as a privatisation temp in the Stock Exchange, rubs his hands at the prospect of more disclosures. "There's more to come," he promises gleefully.

This is not what we expect of an exponent of "the dismal science." Economists should be neither seen nor heard, only read in turgid books. Mr Vaug- han a lager-drinking cyclist and DIY enthusiast, begs to differ. "It's great to be able to knock the Government," he grins.

He got into the job almost by accident, after going to Labour's office at Number 7 Millbank to fix a computer fault for Ed Balls, economic adviser to Shadow Chancellor Gordon Brown. He heard there was a job going, went for it and got it. It pays £19,000 a year - "about average male earnings in industry" - but he is clearly happier than the Nick Leesons in the City.

Vaughan, raised in Camden, north London, after his parents returned to Britain when he was eight, took a BSc in Economics at City University before doing an MSc at Birkbeck College, London. While still a student, he worked part-time at the Stock Exchange on the share issues for electricity and water privatisation. "It was the low-paid end of the Stock Exchange." He then went to work for the National Institute of Economic and Social Research before joining the economic secretariat that services all Labour MPs.

But his chief claim to fame is the invention of politics as investigative journalism. The Shadow Chancellor asked him to start looking at the privatised utilities "to see how big the scams are." His goal was headlines, rather than bulky reports to the national executive that nobody would read. "We started looking into the salaries of the company chairmen, and since then it has been one press conference after another," he beams. "It has gone rather well for us."

Well enough, at any rate, to force the employers' organisation the CBI to set up an inquiry into "greed in the boardroom," and push the Prime Minister into a vague promise to legislate on the issue after he learned about Cedric Brown's million-pound share options. That was another Vaughan "exclusive." His run of disclosures has been the political story of the year so far, and it has not run out of steam yet.

Labour spokesman David Hill admits: "I have heard Tony Blair say that the utility bosses of the mid-1990s are to the Tory Party what certain trade unions were perceived to be to the Labour Party in the late 1970s. And it is all about perceptions." The Opposition's private opinion polling confirms this impression.

In his ground-floor office with a backdrop of cartoons about "fat cats" surrounded by company reports that Labour officials are traditionally not supposed to understand, "Nico" ponders his next target. Quangocrats, you have been put on notice.