Gordon Brown

I

Introduction

Gordon Brown (1951- ), British Labour Party politician, Chancellor of the Exchequer (1997-2007) and Labour Party leader and Prime Minister of the United Kingdom (2007- ).

II

From University to the Treasury

Brown was born on February 20, 1951, in Glasgow and bought up in Kirkcaldy, where his father was a Church of Scotland minister. At the age of 16 Brown entered the University of Edinburgh, becoming its youngest student since 1945. He graduated with an MA in history in 1972, and was elected to the traditionally honorific post of rector of the university the same year. He held the post until 1975, using his right to chair meetings of the university’s governing body to challenge the university authorities and represent the interests of students. He continued his studies after completing his term, researching a PhD on James Maxton, a leading figure in the Scottish Independent Labour Party. He also taught at Glasgow College of Technology (1976-1980), and worked as a journalist and producer for Scottish Television (1980-1983).

A Labour Party activist from a young age, Brown first stood for parliament in 1979, in the constituency of Edinburgh South, which was won by the Conservatives. In 1983 he was elected as Member of Parliament for Dunfermline East, a constituency he served until 2005 (when the constituency disappeared because of boundary changes—at the 2005 general election Brown successfully contested the new seat of Kirkcaldy and Cowdenbeath). He also became chairman of the Scottish Labour Party (1983-1984). From 1987 to 1989 Brown served as opposition chief secretary to the Treasury, and from 1989 to 1992 he was shadow secretary of state for trade and industry. He became Shadow Chancellor of the Exchequer in 1992, and was appointed to Labour’s National Executive Committee. On the sudden death of the party leader John Smith in 1992, Brown was widely regarded as a leading candidate to succeed him, as was the shadow home secretary Tony Blair. Both represented the modernizing wing of the party, and the nature of the apparent agreement by which Brown set aside his leadership ambitions and supported Blair later became the focus of much speculation (and even a television drama). Whatever its exact terms, their alliance came to be regarded as key to the subsequent Labour victory: Blair formed a partnership with his “Iron Chancellor” that attracted wide popular approval, and Brown’s confidence in the role redressed Labour’s inherited reputation for poor economic management.

III

Chancellor of the Exchequer

Following the Labour victory of May 1997, and four days after his appointment as Chancellor of the Exchequer, Brown took the bold move of passing responsibility for setting interest rates to the Bank of England. In other respects, however, Brown was a more cautious Chancellor. Initially he exercised tight economic management, limiting increases in public spending for two years. In his first budget in July he introduced the “welfare-to-work” scheme that was paid for by a one-off “windfall” tax on the privatized utilities. He also took the controversial step of abolishing tax credits for dividends paid into pension funds, which raised £5 billion for public spending but opened up the Treasury to accusations that it had contributed to a future crisis in pension provision. At his fourth budget in March 2000 Brown relaxed his tight spending controls, with large increases in spending for health, education, and policing. In April, Brown pledged to reduce the national debt with the £22.5 billion windfall from the auction of licences for the new generation of mobile phone networks, after fears that further spending would encourage inflation. He was also believed to be a major obstacle to Blair’s aspiration to have Britain adopt the Euro as its currency. The decision was effectively handed over to Brown, who demanded that “five tests” set by the Treasury be passed before membership of the Euro zone could be considered.

In September 2000 the Labour government was confronted with its first crisis. Protestors against high fuel prices blockaded petrol refineries, creating shortages of petrol across the country. Brown promised to review the taxes on petrol in his November pre-budget statement; he subsequently pledged to freeze the tax for up to two years. His budget of March 2001 seemed to confirm his reputation for prudence while advocating social policies such as extended maternity leave, the introduction of paternity leave, and a £2 billion boost for health and education. He was responsible for the running of the Labour Party’s general election campaign in June that resulted in the government’s being returned with 413 seats, a loss of only 6 seats from the 1997 landslide. The budget plans Brown announced in April 2002 included the first increase in direct taxation since Labour came to power in 1997, intended to provide resources for investment in the National Health Service. He also introduced the payment of tax credits to assist those on low incomes, as part of his project to integrate the welfare and taxation systems—Brown often stated that the elimination of poverty was one his principal political objectives.

IV

Succeeding Tony Blair

Although he was not officially given responsibility for the 2005 general election campaign, Brown came to play a central role in Labour’s re-election, not least because his tenure as Chancellor of the Exchequer, during which economic growth had been sustained, inflation kept low, and public spending increased, became the keystone of the Labour campaign. Furthermore, Tony Blair had already stated that this would be the last general election he would contest as party leader, and Gordon Brown was widely assumed to be his most likely successor. By the time Blair announced that he would resign as leader of the Labour Party and as prime minister at the end of June 2007, no rival candidate had emerged, and Brown succeeded to both positions unopposed.

During his first year, Brown’s government was assailed by global economic turmoil, caused by a series of bank failures (including that of the British bank Northern Rock) and intensified by rising fuel and food prices. Coinciding with this instability were income tax reforms outlined in Brown’s last budget in 2007. By the time these reforms were due to come into effect, in April 2008, Labour MPs were concerned that the changes would leave many of Britain’s lowest-paid workers worse off. To head off growing criticism, Brown’s Chancellor, Alistair Darling, announced further tax reforms to compensate those who had lost out. Brown’s reputation for steady economic management was damaged, and Labour suffered at the local elections held in May 2008, where they took only 24 per cent of the vote, less than both the Conservatives and the Liberal Democrats. At the same time, the Labour mayor of London, Ken Livingstone, lost his campaign for a third term. These blows were followed later in the year by a sucession of by-election defeats—in Crewe and Nantwich, which marked the first Conservative by-election victory in 26 years; Henley, where Labour trailed in fifth place; and, most seriously, Glasgow East, a seat Labour had held since the 1920s, where the Scottish National Party won a momentous if narrow victory in July. Criticism of Brown’s leadership in the media reached new levels of intensity, even from commentators who had been among his supporters, with many calling for his resignation.