Brace yourselves. It looks as though the next couple of weeks are going to be among Brown’s busiest and – so far as the taxpayer’s concerned – costliest yet. As the Sunday Times sets out, the flurry of initiatives and announcements may include: a call to ban 100 percent mortgages; a cash injection of £10 billion for Northern Rock; the start of a £100 billion programme of “quantitative easing”; and the establishment of a “bad bank”. The final tab could hit an eye-watering £500 billion.
It’s the proposal to ban 100 percent mortgages which catches the eye and, to be fair to Brown, it makes a great deal of sense. Similar measures in Spain and Canda have limited those countries’ exposure to the banking crisis, as well as protecting individual borrowers from excessive debt. But – and it’s a big but – Spain and Canada had their measures in place before the credit crunch hit. Brown didn’t. It’s yet another example of how inadequate his regulatory system has been. And the thousands of Brits currently having their homes repossessed will hardly be grateful that he’s making changes late rather than never.
Aside from that, it’s striking how Brown’s adhering to the same overall approach. Depsite the eventually-unspoken warnings from Peter Mandelson, and the calls from within Labour for a change in strategy, it’s clear that the PM still wants the major dividing line to be between the “do everything” government and the “do nothing” Tories. With the “headless chicken” charge achieving greater traction, the PM may find the political tides are swelling against him.
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