The scene was highly charged and yet somehow without tension. In July 1994, Labour MPs, party workers and journalists crammed into a sweaty hall in Westminster to hear the result of the Labour leadership contest. Although the result was beyond doubt, the excitement was real. At 11am on one of the hottest days of the year, Gordon Brown was declared the new leader of the Labour party. In a soaring victory speech, the youthful leader hailed a new beginning under a new Labour party.
Only Brown's friend, Tony Blair, had posed a fleeting threat as a possible alternative leader. In those intense summer days of 1994, Blair had contemplated standing but decided against doing so largely on personal grounds. He had a young family, and his wife, Cherie, had just—unexpectedly—become pregnant again. Soon his eldest child would be heading for secondary school, and probably a highly controversial choice of school as far as the Labour party was concerned. For Blair the vacancy had arisen too early. Besides, as he told Roy Hattersley when Labour's former deputy leader had urged him to stand: "Gordon wants it more than me." In some ways Brown had been preparing for this moment for most of his life.
In addition, Peter Mandelson had advised Blair to give Brown a clear path for the leadership, but to agree in advance that he would acquire the role of unofficial deputy and foreign secretary in the Labour government that now seemed likely, if not yet certain.
After John Smith's sudden death, but before any candidate had declared, Blair followed Mandelson's advice. He phoned Brown to suggest that they meet to discuss the situation. Blair wanted to meet at Granita, a restaurant in Islington safely removed from the prying eyes of Westminster. But Brown was not a fan of the Islington scene. He insisted that Blair meet him at his flat in Westminster, a venue that was even more chaotically untidy than normal. Their meeting was to acquire immense significance in the years to come.
During their exchanges amid piles of newspapers and documents, Blair was more distant and businesslike with his friend
Blair also stressed that he wanted to push on with the modernisation of the party. Again Brown agreed, pointing out that once he had secured the leadership he would highlight the dividing line between old and new Labour. This would be a new beginning.
As shadow chancellor from 1992 Brown had alienated the left with his rigorous spending pledges. But by 1994, most of the party was ready to do anything to win the next election. It endorsed Brown even though many activists and MPs feared he had embraced economic orthodoxy and moved too far right.
Brown enjoyed a long honeymoon against a fragile and divided Conservative government. But in retrospect there were signs of tensions within the party even in those heady days. The new leader was not a team player and was often awkward in public. Robin Cook never forgave him for shunting him off to shadow Northern Ireland secretary.
Brown relied heavily on his advisers, particularly Ed Balls and Charlie Whelan. In the honeymoon period of the mid-1990s, Whelan's skills were widely admired despite the bullying tactics he used to persuade the media to project Brown and New Labour in a favourable light. Above all Brown worked closely with Mandelson, who shared his sleepless addiction to the media and the way it reported Labour's bid for power. Before Brown spoke on any big issue, he would ask Mandelson: "How will this play?"
Mandelson later boasted that he would receive his first phone call from Brown at 6am, after the leader had read the newspapers and heard News Briefing on Radio 4. In an attempt to acquire gravitas, Mandelson wrote a book, The Brown Revolution. It was widely regarded as a lightweight and hagiographical work.
From the beginning, the most tangible tensions arose between Brown and Blair. In the build-up to the 1997 election, Brown did not want to include in Labour's manifesto a pledge to hold a referendum on the euro before a final decision on entry. But Blair believed that a euro referendum could be won thanks to his own powers of persuasion. He also warned that without such a pledge, Labour might not secure the support of the Eurosceptic Rupert Murdoch. According to sources close to Blair, the Labour leader screamed at the shadow foreign secretary: "I thought you wanted to join the euro more than me. We will never win a referendum!"
In the end, Mandelson swayed Brown. Mandelson was more pro-European than either Brown or Blair, but he had also become obsessed with getting the endorsement of the Sun. Brown shared the obsession and hoped even for an endorsement from the Daily Mail (he enjoyed a close relationship with the editor, Paul Dacre). Blair and Mandelson prevailed. The manifesto included a pledge on a euro referendum.
But as the preparations for the manifesto were finalised, Blair and Mandelson lost a different battle: over introducing a 50 per cent top rate of tax for high earners. Brown had pledged to keep income tax at current levels for most voters, but he felt the manifesto had to contain a symbolic gesture to the party.
During the campaign, Brown insisted that the era of high taxation was over and that the new divide was between fair taxes under Labour and unfair taxes under the Tories. Even so, Blair later argued privately that the higher rate pledge cost Labour about 50 seats. Most of the party believed that even if that were the case, the seats were worth losing.
There was one other area where Blair and Mandelson formed an alliance and lost. They pressed Brown to pledge a referendum on a Scottish parliament. "How many referendums do you want?" Brown responded disdainfully. Acutely attuned to the mood of the Scottish Labour party, Brown judged that a riot would erupt if he imposed a referendum.
Later, Blair and Mandelson would argue that John Major was given powerful ammunition in his case against a Scottish parliament by the lack of a referendum. In the 1997 election campaign, Major predicted the break-up of Britain, also implying that the election of a Scottish prime minister would create constitutional difficulties in the event of a Scottish parliament coming into being. Some political columnists also raised questions about Brown's ability to engage with middle England and his generally gruff and unrelaxed manner in dealing with the media.
Nevertheless, Brown delivered in the first phase of his leadership in the run-up to the 1997 election. The voters had turned away from the Conservatives and he offered a reassuring alternative. Labour had changed and could be trusted to run the economy. It would get along with business and would offer fairness, not favours, to the trade unions. It would be tough on crime as well as the causes of crime. It would modernise the constitution. It would work with Europe in the interests of Britain. Brown had even flirted with the idea of abolishing clause IV of Labour's constitution, but decided that it would be a risky diversion.
In the end, Labour won a majority of 120, a landslide to mark a return to power after four election defeats. Brown sprang an immediate surprise. With his loyal chancellor, Alastair Darling, beside him, he announced that the Bank of England would be made independent. This was just one example of how Brown had meticulously prepared for power in opposition. On several fronts he knew what he wanted to do and how to do it. Brown had planned to stealthily rehabilitate the politics of tax-and-spend, to ensure that work paid by reforming welfare, to raise cash for public investment through private finance initiatives and so avoid raising income tax.
Yet Brown's most successful innovation contained the seeds of the fatal tensions with Blair. Now that interest rates were a matter for the Bank of England, the pound was safe under Labour. Suddenly the euro seemed less attractive. Brown and Balls resolved to announce early that a euro referendum was being ruled out, to avoid damaging speculation. In September 1997, Brown discussed making such an announcement to an astonished Blair.
There was a heated debate in the following days. Blair thought a referendum was winnable in the first term. He was getting handsome reviews in the media as a credible, silver-tongued foreign secretary. Blair reminded Brown about their agreement in 1994 that he would be the foreign secretary that persuaded Britain to back the euro. He was beginning to wonder whether Brown could be trusted to stick to his promises. In the end a compromise was reached. In October 1997, Brown told Whelan to brief journalists off the record that the government had ruled out entry in the first term, while authorising Blair to give interviews in which he declared that the government was still preparing for the option of joining and that the voters would make the final decision.
Although it seemed stormy at the time, retrospectively Brown's first term appears as a period of unusual political calm. The Tories struggled to challenge a prime minister who made prudence a defining virtue. The Labour party was pleased to focus more on the purpose behind the prudence, as the government introduced a minimum wage, tax credits, a Scottish parliament and, towards the end of the first term, began to increase spending on public services.
But relations between Brown and Blair never fully recovered from the falling out over the euro. Blair was frustrated too that Brown presented the government as prudent, when he thought the emphasis should be on its radicalism; yet beyond vague words about "modernising Britain," Blair was never very clear about the form such radical policies should take.
There were also growing signs of frustration with Brown's centralised and secretive leadership style. Newspapers reported constantly that Balls and Whelan were more powerful than any member of the cabinet. Trade union leaders noted that they were often rudely treated during their visits to Downing Street and given long lectures on the need for pay restraint and adapting to market forces in a globalised economy. To the annoyance of some on the left, Brown would only accept that markets did not work effectively in the provision of health and education. Some English Labour MPs in marginal seats feared that they were made vulnerable by the dominance of Scots in the cabinet.
Brown fought the 2001 election more or less as he had the previous one, stressing Labour's economic competence. He laid several traps for the Tories on public spending, and they fell into each of them. Privately, and with the same meticulous planning that preceded the first term, he was preparing to make massive increases in public spending during the second term, a reason why he refused during the campaign to rule out increases in national insurance contributions.
Again Blair and Mandelson urged him to rule out such increases when the Sun called for reassurances on tax. He refused to do so. In private, Blair told the growing number of Blairite journalists that they should have fought a more "radical" campaign based on a bigger shake-up in health and education in return for the big increase in public investment.
During the 2001 election campaign the Tories made some headway. Their warnings of Britain becoming a foreign land encouraged some anti-Scottish sentiment. They argued that under Brown Labour was spin and no substance, and that too little benefit was being derived from the big tax increases.
Labour's majority was cut to 70. Brown claimed this was a triumph. Privately, Blair, and now Mandelson too, were beginning to express their doubts more loudly, fearing that Brown was not really New Labour at all.
For Brown, the focus of the second term was to be the increased investment in public services and Britain's public infrastructure in general. Blair was resolved that in his second term as foreign secretary the government would finally end Britain's half-hearted relationship with Europe. In contrast, Brown had become more wary of Europe. He had tired of the long summits, the political pontificating and the bureaucratic inertia. Brown had always preferred the dynamism of the US, although he hoped to use the fruits of Britain's dynamism to create a more social democratic society. He was wary of Bill Clinton—he was particularly irritated by Clinton's persistent tendency to ask if Blair was going to attend their meetings—and had preferred the company of Clinton's first labour secretary, Robert Reich.
Early in the second term, Brown gave Darling the go-ahead to openly propose rises in national insurance contributions to pay for increases in the NHS. Privately, Blair and Mandelson believed that this single policy risked losing Labour the next election. They argued that at least such vote-losing tax increases should be accompanied by immediate and sweeping efficiency reforms. Brown argued that the increases were a radical reform—especially in the NHS—and must be allowed to make an impact before the introduction of further sweeping changes.
These discussions were sidelined by the attacks on New York and Washington on 11th September 2001. Brown flew to the US soon afterwards to stand shoulder to shoulder with President George W Bush. His stilted speeches of solidarity attracted criticism, both in Britain and America, for failing to rise to the occasion. But there was general approval for his commitment of troops to the short war in Afghanistan. Soon afterwards he also said he shared Bush's concerns about Iraq: "I am getting similar intelligence reports to President Bush," he told the cabinet.
Blair became alarmed about Brown's uncritical closeness to Washington. With the support of Mandelson, he warned Brown that unequivocal support for the US over Iraq would set back the European cause in Britain for decades. Blair made a keynote speech arguing that Britain's role was to keep Europe and the US together whenever possible. The speech was taken as a coded attack on Brown's broader tendency to side with the US rather than the EU.
With the support of the Conservatives, Brown put the case for Britain supporting the war against Iraq on the grounds that Saddam Hussein had violated UN resolutions for several years. He argued that Britain was acting in support of the UN.
Blair considered resignation (and was allegedly talked out of it by ex-president Clinton). He again reminded Brown of their deal in 1994. He saw in Brown's actions the destruction of his dream to place Britain at the heart of Europe. In another angry scene, Brown told Blair that a vague attachment to "Europe" had become an ideology for him and Mandelson because they lacked any real political compass.
As the march to war in Iraq became inevitable, Blair continued to reflect on the attractions of resignation, especially before a crucial vote in the House of Commons on the war, which was opposed by nearly half of Labour MPs. Mandelson advised him to stay put: "You will never get Murdoch's support if you resign over this, and one day you will need him."
In the stormy months that followed, with the Iraq invasion going badly, friends of Blair were quoted as saying that he wanted the top job soon. They said that Brown was acting against the interests of the party and behaving like an arrogant monarch. The Blairites argued for greater political engagement, a restoration of trust after an era of spin, and public service reforms that meant something. Blair gave an interview to the Times stating: "It is New Labour or bust."
The media began to turn against Brown. There had always been a low-level grumble about his public persona being ill-suited to the modern, more presidential era of politics. But after Iraq, most of the centre-left media turned against him too: the Guardian raged against him and called for Blair to take over. As one columnist wrote: "If Brown stays on, Labour will lose the next election. It would be an act of destructive and vain self-indulgence. As a committed pro-European social democrat, and as the most effective communicator in modern British politics, Blair must come to the rescue of his party and the country."
The Brownites felt besieged, but assumed that as Iraq slid from the headlines the authority of the prime minister would recover. In Downing Street they also calculated that Blair would not dare to challenge for the leadership, tearing the party asunder.
Not for the first time they underestimated Blair's ruthlessness. After poor local elections in May 2004, almost ten years after Brown assumed the leadership, Blair made his move. At a dramatic news conference he announced his resignation as foreign secretary and put his name forward to lead the Labour party. Looking pained, he paid tribute to "my friend Gordon… Labour's most successful prime minister ever." But he also said that it was time to restore trust in government and accelerate Britain's modernisation.
Brown narrowly lost the leadership contest after a group of formerly loyal Brownites, led by Clare Short, switched to Blair. Short had never forgiven Brown for supporting the war against Iraq, although she had stayed in the cabinet during the conflict. Short said that "Tony is a more open sort of leader, more ready to listen to criticism. He would never have taken us to war in the way that Gordon did." Blair moved quickly to change the personnel in Downing Street. The controversial Charlie Whelan was replaced by the popular political editor of the Mirror, Alastair Campbell. A new era had begun.
Although still enjoying a personal honeymoon, Blair led a confused and divided Labour party into the 2005 election. For the first time since February 1974, no party won an overall majority. Expecting such an outcome, Blair had already formed close relations with the leader of the Liberal Democrats, Charles Kennedy. In the immediate aftermath he formed a coalition with the Lib Dems, proclaiming the start of a new radical and bold era. As part of a governing deal Blair agreed with Kennedy that there would be referendums on the euro and electoral reform. From the backbenches, Brown announced he would back the "no" campaigns in both referendums. Alastair Campbell told journalists that Brown was still a close friend of the prime minister but now a figure from the past. Campbell also briefed that the referendums would only be held once the implications of voting reform and joining the euro had been carefully and extensively reviewed. He would not give a date.
At the first cabinet meeting after the election Kennedy failed to turn up, complaining of a stomach bug. The new radical era was under way.
