Brown Offers UK Voters a Generous Pre-Election Bribe

Gordon Brown has served as the Chancellor of the Exchequer for long enough to know better. While being in charge at the Treasury means telling all the other departments “No,” it is a critical function in any democracy to keep the lid on public spending. Yet, chancellors are politicians, and playing Santa wins more votes than playing the Grinch. Mr. Brown’s latest is nothing short of a bribe his government can’t afford, and his credibility will suffer accordingly.

He has put up £2 billion in new spending despite predictions in most corners that he needed higher taxes and/or spending cuts. The Chancellor is expecting growth in the British economy to run at 3-3.5% next year. He’ll be lucky if it’s 2.5% according to the Bank of England and others. Borrowing for fiscal 2004-5 should be around £34.2 billion, some £1.2 billion more than the Chancellor thought earlier. Worse, Mr. Brown said in his 2002 budget that the figure wouldn’t be £34.2 billion but rather a merely £13 billion. According to the Times, “Over the five financial years from 2004-05 to 2008-09, the Government is set to borrow £7 billion more than expected in the March Budget.” Worse, the figure is held down by a £4 billion windfall from North Sea Oil, which at $50 a barrel, helps Britain.

There is nothing inherently wrong with any of the ideas the Chancellor proposed – indeed, they are wise. Employers can give £50 a week more in child care to employees tax free, paid maternity leave transferable to the father will go from 6 months to 9 months (truly a pro-family value), free nursery school for 3 and 4 year-olds rising to 15 hours a week, no fuel duty for now, a £40 weekly bonus to single parents who get a job, an extra £50 to pensioners over 70 to pay winter fuel bills, no tax on independent savings accounts, a cap on local government spending holding increases to 5%. But sadly, he can’t afford them.

Mr. Brown is in an unfortunate position, which every chancellor faces. He needs to spent wisely to retain his reputation in the financial markets, but that the same time, he needs to make sure any penny-pinching doesn’t cost votes. His ambition to succeed Mr. Blair as prime minister hinges on winning the next election. Mr. Blair has said he won’t try for a fourth term, but he wants a third election win – more for ego than anything else. At some stage, he will hand over to Mr. Brown, unless Mr. Blair is very mean and sneaky.

If Labour were to lose this spring, as unlikely a prospect as that may appear before Christmas, a generational change may be in to works at New Labour. Mr. Brown might fall victim to such a call for new blood and find himself passed over for the spot he has coveted for so long. So, to safe guard his chance at the top job, he has placed a wager – he’s betting that the bill won’t come due on this profligate spending until it’s someone else’s problem. One had thought more of the Chancellor than that.


© Copyright 2004 by The Kensington Review, J. Myhre, Editor. No part of this publication may be reproduced without written consent.


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