A Journey (39 page)

We had, of course, increased the investment and there were extra staff being recruited and so on, but not enough to notice in what was a massive organisation, the biggest single employer in Europe.

It had been our pledge to remove the so-called divisive internal market of GP fundholders and ordinary GPs. This was a limited market experiment. Some GPs loved it. Others hated it. It did indeed make for a two-tier system. As grammar schools had. The trouble with this criticism was that an unreformed system also had its tiers. The middle class will always find a way to make the system work, or at least answer to them in some form or other. So good schools, comprehensive or not, would be in good neighbourhoods.

Throughout that period, then, roughly March 1998 to December 1999, we went through enormous policy introspection as the Green and White Papers flowed, the policy wheels turned and the Civil Service toiled. I debated with policy experts, think tanks and the Number 10 unit headed by David Miliband, but had, as I have said, a growing hunch that our approach was not right. Not that it was wrong or having no effect – it was – but that it was incomplete at best, short of a dimension that was not peripheral but core.

The extraordinary thing was that there was no outside body, or institute or centre of learning that provided the dimension, with the possible exception of the work Richard Layard did for us at the London School of Economics on the New Deal. I used to pore over the latest offerings from various highly reputable academic or scholarly quarters, and find nothing of any real practical help. The trouble was that they essentially wanted to discuss the ideology behind the issues of reform. In a bizarre way, they focused on the politics – but that was not what I needed help with. I needed to know the practical answer. To me, to charge for the NHS or not is a political or ideological question, but the fastest way to cut waiting lists is not.

While we were trying to come up with solutions – ‘what counts is what works’ – the sobering truth was that the system of welfare and public services was vastly complex, and ‘what does work?’ was the question I kept referring to, without a great amount of external intellectual sustenance being provided. So we continued with the approach we had taken – driving from the centre – but we shied away from deep systemic reform. As a result, we could not produce change that was self-generated or self-sustaining, but only change generated and sustained from the centre.

Nevertheless, at the party conference in 1998 the speech flowed. It set out the third way – not old left nor Thatcherite right; we had enough momentum to show things were changing; and to be fair the basic message was one of constant challenge, at least to the party. It was strong on devolution within the nation and partnership outside of it with Europe and America. It had all the right themes, pressed all the right buttons and, on the whole, generated the right responses.

As I sat afterwards with the close political family – Jonathan, Peter, Alastair, Anji, Sally, Peter Hyman – I knew we were still at the start of the journey, knew we still had a mountain to learn about as well as to climb, and my feelings were mixed, impatience and frustration knocking shoulders with the pride in achievements and political success; and of course there was also this glimmering of an appreciation that the rhetoric and the reality were out of alignment.

Another part of the problem was that there was increasingly no real interest in a policy debate. The Tories were in many ways
hors de combat
, still licking their wounds and, aside from Europe, not much bothered in opposing a government that, by governing from the centre, was making it pretty hard for them to get orientated.

Moreover, the media had settled into a mode, developing over time, whereby without a major controversy or visual focal point, there was no real interest in describing policy. For instance, they had been more engrossed in the Harriet Harman and Frank Field
pas de deux
than in the intricacies of the pension debate, Harriet being the Secretary of State for Social Security and Frank being the Minister for Welfare Reform. Admittedly, this saga was fairly engrossing. Harriet was not really a policy wonk and this portfolio required a lot of wonkery. Frank was not really politically astute and it required a lot of political astuteness.

The result was a severe mismatch, like a kind of ‘dating agency from hell’ mistake. Frank was hugely persuasive on the big picture, but I couldn’t seem to get him to focus on the practical policy. Harriet was desperate to be supportive of the policy, without quite understanding that it was her job to devise the damn policy.

Frank used to lock himself away in his office to ‘think the unthinkable’, but the problem was not so much that his thoughts were unthinkable as unfathomable. Harriet fussed and fretted. They would sit in the Cabinet Committee disagreeing with each other, which was more than mildly disconcerting. The upshot was that we tried to steer policy out of Number 10, but it was hard. And, of course, the policy area itself was incredibly hard. The results were less than satisfactory.

I removed Harriet in the July reshuffle, which she took well, to her credit. When I refused to make Frank Secretary of State, he resigned. It was embarrassing, and though I both really liked and respected Frank – a genuine free independent spirit – I was also relieved. Some are made for office, some aren’t. He wasn’t. Simple as that.

After party conference we began preparing in earnest for the Queen’s Speech. Although for the reasons given I was not wholly satisfied with the welfare reform package, it was to be the centrepiece of the speech. The weeks prior to it – and it was rather late that year, on 24 November, delayed by the leftovers from the previous packed parliamentary session – were a direct lesson in how the agenda can be hijacked by events from the grave to the trivial, or at least the sensational.

On the morning of 27 October, Jonathan Powell and Alastair Campbell suddenly interrupted the usual slew of meetings to pull me into the Downing Street dining room. The two of them together always meant trouble. What they told me made my eyes get wider and wider until I was like someone with goitre. It was one of those laugh, frown, gasp, sad routines.

Ron Davies, the Secretary of State for Wales, had been robbed by a black male prostitute on Clapham Common. My mind was fairly boggling, and we asked Ron to come into Number 10.

‘It’s all very easy to explain,’ he began. ‘I had been in Wales for the weekend, I drove up to London, and to stretch my legs I decided around midnight to go for a walk on Clapham Common.’ Puzzled looks from listeners. ‘I bumped into this Rasta bloke and we got talking, you know, as you do.’ Eyebrows raised further. ‘He said: Why not go for a curry? I said: Fair enough, and got in his car.’ Mouths start to fall open. ‘Then we met up with a few of his mates and suddenly I was set upon and robbed. Could have happened to anyone.’

Stunned silence, then almost in unison, ‘Er, not really, Ron.’

I know it’s all absurd and, set out like that, comic; but it was also someone’s career and life just about to disappear down the drain. That is what is so unbelievably cruel about political life. Of course it was the dumbest thing. In Ron’s statement, which I helped to draft, I described it as ‘a moment of madness’, but I knew his career couldn’t be salvaged. The problem was not anything to do with sex or not, it was the misjudgement. I felt desperately sorry for him. I had known him since we came into Parliament together in 1983. He was a talented operator, though most people felt he was too talented an operator for comfort. But no one really deserves what he got.

And, naturally, it followed the same course as virtually every resignation I ever dealt with. At first they understand and comply. Then, as the enormity sinks in, they rebel and finally they become resentful. Ron followed that pattern precisely. And, of course, the hounding they get is a horrendous pressure on them and their family. Ron’s was a resignation that was inevitable.

Over time, however, I became increasingly resentful of how resignations were forced. And so much depended on the circumstances of the revelation.

Unbelievably, a few days after Ron went, the
News of the World
trapped Nick Brown, whom we had moved from chief whip to be the Agriculture Minister in the July reshuffle, with someone who they said was a rent boy. When Alastair told me – and rather innocently I had never been sure Nick was gay – the room did sway a bit. Two gay scandals in one week. And there I am, completely committed to equality between gay and straight. Chris Smith had just bravely come out as the first openly gay Cabinet Minister. People knew Peter Mandelson was gay. I was a little alarmed at the public becoming a trifle wide-eyed themselves at everything.

To be fair to the
News of the World
, they came to us with the story on the Thursday before the Sunday publication, and Alastair heroically persuaded them to run it with Nick coming out as a gay man. The result was the story turned from a sordid scandal into an honest confession and Nick was saved.

He had been very angry at being moved from chief whip, and I knew he was more or less continually working for Gordon and against me, and had actually probably been doing so all along. But when the revelation came, he was saved, not least because he wasn’t chief whip, though mostly because we went out of our way to save him. And here’s where you just can’t get all aggrieved as leader. You would think he would be grateful. Not a bit of it. He carried on believing he had been hard done by and that I was out to get him, when, of course, I could have got him there and then and finished him off. But we didn’t because we were not like that. It was always odd to be described as having this incredibly ruthless machine, when actually we had plenty of ruth; indeed, on occasions far too much of it.

Just before Christmas 1998 there was a huge resignation, one that in time I came bitterly to regret and in respect of which I still reproach myself, though when I reread Alastair’s diary on it and its accurate account of what the media furore was like, it is hard to see how it could have been toughed out.

Essentially, Peter Mandelson had been given a loan by Geoffrey Robinson, the Paymaster General, to buy a house. The sum was large, certainly in those days: £373,000. Peter was Secretary of State for Industry, and the department was inquiring into Geoffrey’s business dealings, an inquiry established in response to a Tory complaint, and set up well after the loan was made. Peter hadn’t disclosed the loan to his permanent secretary. He should have. That he didn’t do so was, I had no doubt, nothing to do with being dishonest. In fact, Peter had had nothing whatever to do with the inquiry into Geoffrey, and neither would he have. If he had disclosed it, the affair would possibly have been manageable, though in the event the media just went for the whole thing rather than that one aspect.

As was my wont with ‘scandals’ at that time, I pulled in the Lord Chancellor Derry Irvine and Charlie Falconer, who had until recently been Solicitor General, as two good forensic minds. Both thought it very difficult.

I pushed the issue away for two days, and in any event was intensely preoccupied with the proposed US military action in Iraq at that time. The
Guardian
had broken the story, and the rest piled in. It was wall-to-wall mayhem. Several members of the Cabinet called to say it was hopeless. Good old Jack Cunningham, whom we had moved from Agriculture to be Minister for the Cabinet Office, went out to defend the position, but even he found it hard. At least Parliament wasn’t sitting, thank God.

By 23 December, I felt I couldn’t sustain it. I steeled myself and told Peter, who accepted my decision with extraordinary grace. I also sacked Geoffrey. And I told Gordon that Charlie Whelan, his spokesperson, had to go as well.

My feelings were beyond rage; more real sadness and a sense of doom. The truth is I don’t know that Gordon’s people leaked it – you never do know – but only two people were party to the agreement for the loan, and I was sure as hell Peter hadn’t told anyone, since he hadn’t even told me. And it was the
Guardian
, not the
Mail
or the
News of the World
, to whom the story had been given; it was therefore more likely to be a party source such as Charlie Whelan, since the
Guardian
was more or less the party in-house paper at the time.

One thing was for sure: whoever it was had done it with complete malice aforethought. This was not a story, it was a political assassination, done to destroy Peter; but it was done also to damage me and damage me badly, without any regard to the impact on the government.

I sat in Chequers that Christmas Day and contemplated. Peter was a brilliant Secretary of State, had real verve and imagination, and was loved by his department (and believe me this is pretty rare). He was an important part of the government, and a crucial part of New Labour. This would end his career. Knowing all that, someone gives the story to the
Guardian
. What is the mentality of such a person? Determined, vengeful, verging on wicked. It frightened me because of what it might mean. People always think politicians behave to each other like something out of a Jeffrey Archer or Michael Dobbs airport novel, but in my experience, they don’t. There is rivalry, backbiting, undermining, but little that you could describe as really dark. But this was.

I knew, in one sense, sacking Charlie Whelan was unjust because, as I say, I really didn’t know that he was responsible; and to be fair, he denies it. I also knew, however, that if I didn’t sack him, then a terrible lesson, with possible momentous consequences, might be learned for the longer term. So, after a bit of toing and froing, he went.