Some of us are still waiting for an apology - for Gordon Brown's raid on pensions

Although I'm all in favour of today's government apology to Thalidomide survivors, I'm resigned to the fact that there will never an apology for Gordon Brown's raid on pension funds soon after he became Chancellor of the Exchequer.

If you've only recently discovered this blog, here's what I posted in April last year.

I don't often 'repost' posts, but am doing so because today's story reminded me of how rarely governments ever apologise for anything - and because I feel strongly enough about it to be hoping that I won't be the only one who remembers it on polling day.

16 APRIL 2009

Time for Gordon Brown to say "sorry" to savers

After today's belated “sorry" for emailgate, Gordon Brown went on to say that he had been “horrified, shocked and very angry indeed” about it – words that exactly sum up how I’ve been feeling about his onslaught on savers ever since he became Chancellor of the Exchequer in 1997.

This blog normally concentrates on, and with occasional exceptions like today, will continue to concentrate on making observations about speaking and communication, rather than expressing political opinions. But I’ve been “horrified, shocked and very angry indeed” about Mr Brown’s attack on savers for twelve years for the very simple reason that it occurred at a time when I was devising a strategy for my own savings and retirement.

Having decided some years before 1997 that I wanted to avoid having to sink my life’s savings into an iniquitous annuity that would allow some life insurance company to pay a pitiful rate of interest – and then pocket the lot if I happened to die the next day – I had already started to invest as heavily as I could in PEPs, on the grounds that it seemed preferable to pay the tax first and enjoy tax-free benefits later than to get tax relief on today’s pension contributions in exchange for the dubious benefits of an annuity tomorrow (not to mention to have the freedom to bequeath anything I hadn’t spent to people more dear to me than an insurance company).

Then, and people seem to have forgotten this, one of Brown’s first plans when he became Chancellor was to introduce retrospective legislation that would eliminate the tax advantages that had induced millions of us to invest in PEPs. I remember writing to him (and every other relevant politician I could think of) pointing out how unfair this was, and urging that there should be no change in the terms of reference that had made people like me opt for this particular form of savings in the first place.

Thankfully, Brown dropped that plan, but didn’t drop the even more cunning plan of abolishing one of the main incentives to put savings into pension policies, namely the tax relief on dividends earned within a pension fund that used to make them build up more quickly than would otherwise have been the case.

The first ten years of this infamous raid on pension funds bagged in excess of £100 billion from millions of thrifty savers who had been naïve enough to think it might be a good idea save for their retirement.

Even without the post-credit crunch shrinkage of interest now payable on annuities, Brown’s raid had already guaranteed us a much lower pension than we’d been led to believe we’d get when we first signed up for it. It also fired the starting gun for more and more companies to close down their final salary pension schemes.

Two other things about Mr Brown’s position on savings and pensions also leave me “horrified, shocked and very angry indeed.”

One is that he suddenly and belatedly started to sound surprised and worried that the country is now facing a major pensions crisis.

The other is that, whenever interviewers dare to raise the subject with him, he never admits that he had anything to do with it, and becomes even more evasive than the 'default' extreme evasiveness he typically displays in response to any question anyone ever puts to him.

Saying “sorry” for emailgate may or may not work as an effective piece of damage limitation in the aftermath of the recent misconduct of his inner circle.

But the “sorry” millions of us are still waiting for is for the damage he, and not his henchmen, did to our savings.

Unfortunately for us, it’s far too late to limit the damage he’s already done.

Unfortunately for him, none of us will have forgotten about it when we go into the ballot box.

Vowels, voters and the voice of authenticity: the leadership case for Andy Burnham

You might have thought that my post the other day about Andy Burnham declaring his candidacy for the Labour Party leadership was just a tongue-in-cheek exercise. But the more I think about it, the more I think he would be the party's best bet once Brown has gone.

The likes of Straw, Harman, Darling and Johnson might have been OK as caretakers if Brown had been deposed. But, assuming they lose the election, the Labour torch will surely have to be passed on to the next generation.

In various other posts, I've stressed the importance of British party leaders having an elusive appeal that extends beyond those who normally vote for their party. Thatcher and Blair had it, as did Jo Grimond and Paddy Ashdown for the Liberals, but Gordon Brown doesn't have it (for more on which, see HERE & HERE).

Clinging on to the core vote

Since the advent of 'New Labour', the party's main marketing problem has been how to bring middle class voters on board whilst, at the same time, holding on to trades unionists and the 'core vote'.

Blair's public school and Oxford credentials, coupled with his 'natural charm', were arguably critical in winning over enough Tory voters to see him through three election victories.

But he was also very lucky (and/or shrewd) to have had a supporting chorus of Northern vowel sounds from David Blunkett and John Prescott, senior ministers who sounded like (and appealed to) large swathes of the party's core vote.

Bourgeois intruders in the Labour heartlands

Like Tony Blair, potential leadership candidates such as the Miliband brothers and Ed Balls, not to mention Yvette Cooper (AKA Mrs Balls), all come from highly educated middle class backgrounds - with its potential appeal to waivering Tories (if there still are any).

Something else they also have in common with Blair is that they too were parachuted into safe Northern constituencies that had traditionally always selected and returned trades unionists as their MPs.

But, unlike Blair, they're a bit short on Blunkets and Prescotts to boost the party's appeal to its core voters - with one notable exception:

Andy Burnham, BA (Cambridge): a Labour lad from Lancashire

In marked contrast with the other likely contenders in the Labour leadership stakes, Burnham is the MP for his home town - rather than for somewhere he'd never been to or heard of until being awarded a safe seat by the party's high command.

What's more, his years in the South haven't completely eliminated the authentic Northern vowel sounds that make him sound like 'one of us' to Labour's core vote - whilst his Oxbridge education gives him the middle class credentials of a Thatcher, Blair or Cameron.

Add to that the fact that I've seen commentators refer to him as 'good looking' (*), and have never heard anyone who knows him say anything other than what a nice chap he is - and he may have the Blair 'charm' factor too.

Too nice?

So the main question about him looks like being whether he's too nice to bite the bullet hard enough to go for it, win and do the dirty deeds that will have to be done to put the New Labour show back on the road.

*P.S. Since writing this, my attention has been drawn to this interview with LibDem M.P. Lynne Featherstone, who came second to Mr Burnham in a 'most fanciable M.P.' poll - and who describes him here as "drop dead gorgeous":

Political speeches can still make a big difference - like changing the date of an election

A few days ago, I posted some of the reasons why I think that current British politicians and media underestimate how important speeches can be (the 'Snakes & Ladders Theory of Political Communication').

So today, I was fascinated to see confirmation in the serialisation of a book by Peter Watt, former Labour Party general secretary of the Labour Party, in today's Mail on Sunday of something I'd long suspected - namely that David Cameron's speech at the 2007 Conservative Party conference was critical in deterring Gordon Brown from calling an election (which he announced two days after the speech):

On Thursday, Cameron called our bluff. He made a spectacular speech demanding an end to the weeks of frenzied speculation about the Election. ‘So Mr Brown, what’s it to be?’ he taunted. ‘Call that Election. We will fight. Britain will win.’

A panicky Gordon summoned Ed Miliband, Ed Balls, Spencer, Douglas, Deborah Mattinson – Gordon’s pollster – and Sue Nye – Gordon’s senior adviser and trusted ‘gatekeeper’ – for a crisis meeting.

On Friday morning, Douglas called me. ‘Peter, Gordon’s not going to do it,’ he said quietly. ‘When’s he going to make an announcement?’ I asked. ‘Tomorrow’ (my emphasis).

Given that Labour was 10% ahead in the polls at the time, Cameron's decision to ditch his original script, speak from notes and challenge Brown to call an immediate election was a high risk strategy.

But, in terms of the 'Snakes and Ladders' theory, it was a crucial 'ladder' that paid a handsome dividend to the Conservatives - not just in the favorable media reactions it generated, but in the two extra years it gave the party to reverse the polls in their favour - time they wouldn't have had if Brown had gone ahead and called the election when everyone (including, we now know from Peter Watt's book, the Labour high command) was expecting it.

You can watch the full speech above, or see a BBC report on it with video highlights HERE.