Downing Street bade a final farewell to the New Labour era as Gordon Brown stood down as Prime Minister, party leader and MP to usher in the “New Politics” of the first coalition government in 65 years.
Mr Brown, who took the two sons he had hitherto shielded from the cameras for a final stroll down Downing Street, handed over leadership responsibilities to caretaker leader Harriet Harman as the Labour Party prepared itself for its first leadership election in 16 years.
Before the contest even started, divisions emerged with Ms Harman insisting there should be no contest for her post as deputy since there is no vacancy as she intends to return to it after the leadership poll.
Mr Brown’s own leadership had earlier been offered up as he bowed to pressure from Ed Balls, Peter Mandelson and others to timetable his own departure as the price of a possible deal for Liberal Democrat support to keep Labour in government.
But the inherent instability of such an alliance, and resentment from many Labour MPs, scuppered hopes of such a “progressive rainbow coalition” representing 51 per cent of British voters and rendered Mr Brown’s self-sacrifice redundant.
David Cameron, impatient to end 13 years of Tory opposition, improved on his earlier “minority government/confidence and supply” proposals and hastened to better any offer Gordon Brown could ever have made.
Mr Brown’s courtship of the Liberal Democrats thus enabled leader Nick Clegg to successfully parlay a disappointing election performance in which he lost MPs into an ambitious five-year fixed-term coalition programme for government with the Conservatives under a banner of “freedom, fairness, and responsibility”.
Among the prizes for newly-appointed Deputy Prime Minister Mr Clegg are responsibility for political and parliamentary reform, five Lib Dem cabinet posts, up to 20 ministerial posts across Whitehall and the scrapping of a number of emblematic Tory manifesto pledges. A third of Mr Clegg’s Lib Dems are now on the Government payroll.
In the time between Mr Cameron’s arrival in Downing Street on Tuesday evening – watched by 13 million television viewers – and his rose garden press conference with Mr. Clegg in Downing Street on Wednesday afternoon, the new coalition jettisoned Tory plans for a million pound inheritance tax threshold and the Lib Dems’ own mansion tax.
Both parties also agreed an autumn spending review, real increases in NHS funded by cuts in other departments, a quota on non-EU immigration, to retain the overseas aid target of 0.7 pc of GNI, and to restore the earnings link for the basic state pension from April 2011 with pensions to raised by earnings, prices or 2.5 pc whichever is higher.
In addition, the junior coalition partner abandoned its own proposed amnesty for illegal immigrants and its opposition to replacing the Trident nuclear deterrent, undertook to keep the Britain out of the euro for the life of this parliament and embraced new Chancellor George Osborne’s additional
£6 billion of cuts in public spending for the current financial year.
Both sides are now signed up to an emergency budget within the next 50 days with a view to a significant reduction in the fiscal deficit, scrapping the scheduled 1 per cent increase in National Insurance Contributions, and cuts to the Child Trust Fund and tax credits. In turn, there will be a referendum on replacing first past the post with the alternative vote (AV) system and a partially-elected House of Lords, and moves from next year to increase the income tax threshold to £10,000.
