Labour slowly sinking in sea of sleaze

Published in Newcastle Journal, Lincolnshire Echo and Derby Evening Telegraph, Saturday July 22, 2006.

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Prime Minister’s Questions is always a rumbustious affair, and the end-of-season duel between the two main party leaders before MPs head-off for the long summer recess is always doubly so.

It is, after all, their last chance to score a morale-boosting victory, send the troops away happy, and slip a defining soundbite into the public consciousness before the holiday season begins in earnest.

On Wednesday, Tory leader David Cameron managed it, interrupting one of Tony Blair’s frequent diversions into Conservative policy with a killer intervention.

“These sessions are for me to ask him questions,” he reminded the House. “I know the Prime Minister doesn't like being interrogated, but if he's going to be interviewed by Scotland Yard he'd better get used to it.”

Routine political knockabout? Or just a measure of the humiliation of a once “whiter-than-white” Prime Minster who first came to power in 1997 on the backwash of a tide of Tory sleaze?

“Remember, you are not here to enjoy the trappings of power, but to do a job and to uphold the highest standards in public life,” Mr Blair told his MPs at their first gathering in the wake of that landslide.

“I think that most people who have dealt with me think that I am a pretty straight sort of guy, and I am,” he said in November 1997, when the first hint of Labour sleaze in the shape of the Bernie Ecclestone affair threatened to end his political honeymoon.

How hollow those proud boasts now sound, as nemesis in the form of the police investigation into “cash for honours” makes it way inexorably to the steps of Number 10 Downing Street.

Why does this scandal pose such a potentially terminal threat to a Prime Minister who has surely survived worse crises, not least the suicide of Dr David Kelly three years ago this week after his exposure by the government?

Well, quite simply, because this is one story for which the buck really will have to stop at No 10.

The award of peerages is something that is in the gift of the Prime Minister alone, while the apparent linkage between this and donations for his flagship city academies scheme only adds to the air of suspicion.

Partly, it’s the fault of a system of patronage which concentrates power in the Prime Minister’s hands, but it’s also in part down to Mr Blair’s own personal style and apparent contempt for the House of Lords as an institution.

It was ever thus. Long before it was alleged that Mr Blair had handed out peerages in return for Labour loans or help in establishing academies, the cynicism with which he was prepared to use the honours system was already apparent.

As North-East voters are perfectly well aware, the business of becoming a Labour peer under Mr Blair has often had more to do with whether you have a safe Commons seat available for one of his favourites.

For instance, in 2001, he needed a way of getting the head of his policy unit, David Miliband, into the Commons, as a necessary precursor to bringing him into the Cabinet.

Eventually the former South Shields MP Dr David Clark duly agreed to fall on his sword, being rewarded with the title Lord Clark of Windermere and the chairmanship of the Forestry Commission.

Neither is “cash for honours” exactly a new development. Back in 2001, the entrepreneur Paul Drayson gave a £50,000 donation to the Labour Party at the very time the Government was deciding whether to award his company, Powderject, a £32m contract.

The contract, to supply vaccines in the event of a biological attack by terrorists, was duly awarded and Drayson, by now rather flush with the £20m profits from the deal, gave the party a further £500,000.

An incredible six weeks later, he was made a life peer by Mr Blair in what now stands as a startling illustration of the Prime Minister’s nerve on the one hand and the supine nature of much political reporting at that time on the other.

The ennobled Lord Drayson completed his voyage to the centre of the British establishment in 2005 when he was appointed Minister for Defence Procurement.

Where will it all end? Well, even if no charges are eventually brought, the feeling of “no smoke without fire” will persist, and Mr Blair will have to live with the accusation that his is as decadent a government as its despised Tory predecessor.

I have written previously that the leadership issue will have to be resolved by the end of this year’s Labour conference in Manchester, and nothing that has happened since suggests anything to the contrary.

Furthermore, it’s going to get worse before it gets better for Labour. Mr Blair is off on his holidays on August 2, meaning John Prescott will then be left in charge.

The Prime Minister really ought to have made sure that Mr Prescott took his holidays at the same time as him this year, enabling him to leave Margaret Beckett, John Reid or even Gordon Brown himself minding the shop.

The tragedy for Labour is that much of the current political damage to the party, as opposed to that attaching Mr Blair individually, could all have been avoided had he stuck to his original instinct to stand down in 2004.

Had he done so, Prime Minister Brown would now be dealing with a scandal which was essentially a matter of past history rather than anything of current relevance to his government or its standing with the electorate.

As it is, Mr Brown – or whoever else takes over - will be very hard-pressed to distance himself sufficiently from this affair to regain the public’s trust in time for the next election.

The danger for him – and for Labour – is that, just as in 1997, cleansing the Augean stable of the stench of sleaze might now require an entirely new government.