Briefing from the Prime Minister’s Official Spokesman on: President Putin and Peter Hain/Tax.
President Putin
The Prime Minister’s Official Spokesman (PMOS) took the opportunity to rebut reports in some of today’s papers which claimed that the Prime Minister had snubbed President Putin in the light of the arrangements for the latter’s State visit next week. He said that the reports were at the more ridiculous end of the market and they should be dealt with before they entered the bloodstream. The Prime Minister would spend a significant amount of time with the President in line with visits by other foreign Heads of State. He would be present at the ceremonial welcome, the State Banquet, a summit on energy and a joint press conference, in addition to private time set aside for talks. The Russian Embassy had also made it to clear to us that they were perfectly happy with the arrangements, which was why the genesis of the story today was a bit of mystery to us.
Peter Hain/Tax
Asked the Prime Minister’s reaction to Peter Hain’s comments on taxation policy today, the PMOS drew journalists’ attention to comments the Prime Minister had made in a doorstep at the European Council in Greece this morning during which he had also underlined that the UK would remain a competitive economy and that there would be no return to tax and spend.
Asked if the Prime Minister had been forewarned about Peter Hain’s speech or whether Mr Hain’s comments had been a ‘bolt out of the blue’, the PMOS said that Downing Street had known that Mr Hain would be making a speech this evening, but we had not been aware of its contents. Asked if he was saying that the first anybody in No 10 had known about the speech had been this morning, the PMOS said that we had been made aware late yesterday evening that something was in the offing. However, he had not expected to attend this morning’s briefing and be discussing a ‘debate on tax’. Our ‘grid’ had been rather more focussed on the excellent teacher training report which had been published today, as well as the European Council in Greece. Life was full of surprises.
Asked whether Ministers were supposed to clear all their speeches with Downing Street, the PMOS said that he had no intention of getting into a discussion about internal processes. He hoped that the Prime Minister’s comments this morning had clarified the Government’s position to everybody’s satisfaction. He repeated that Downing Street had not been aware of the contents of Mr Hain’s speech. Put to him that we should have been, the PMOS said that editorialising was a matter for the media, not for him. Put to him that Mr Hain had suggested that Downing Street had indeed been made aware of the contents of his speech, the PMOS repeated that No 10 had been notified about the speech late last night, but that the details with which we had been provided were of a very general nature. Asked if the Prime Minister had spoken to Mr Hain today, the PMOS said no. Asked if he was planning to do so before Mr Hain’s speech this evening, the PMOS pointed out that the Prime Minister was rather tied up with the discussions at the European Council in Greece today. Asked if the Prime Minister had spoken to the Chancellor about the speech, the PMOS said not as far as he was aware.
Questioned as to whether the Prime Minister and Chancellor were closing down discussion about tax rates ‘for ever more’, the PMOS said that taxation issues were a matter for the Chancellor and his Budget Statements - the run-up to which were always characterised by close discussions between himself and the Prime Minister. This Government had been elected on a manifesto and had set out its spending plans. They were fully financed on cautious and prudent assumptions. Asked about the policy in future Parliaments, the PMOS said that as a Civil Servant he was unable to talk about future manifestos drawn up by political parties. All he could do was point to the current manifesto and the Prime Minister’s words today. He thought they made the position pretty clear. He reminded journalists that the Prime Minister had told Jeremy Paxman in an interview in the run-up to the last election that "It is not a burning ambition for me to make sure that the David Beckhams earn less money". This Government had always been about creating a society which combined enterprise and fairness. On the one hand there were competitive tax rates for business. We had cut corporation tax to its lowest historical rate. To help small businesses we had cut corporation tax starting rates to zero so that 150,000 companies no longer had to pay it. There were also a variety of tax credits to encourage enterprise and innovation. On the other side of the equation, we had introduced the National Minimum Wage, the Working Families Tax Credit and the Child Tax Credit.
Put to him that the Prime Minister had stated in his speech to the Fabian Society on Tuesday that there was a need for higher taxes to pay for better quality public services, the PMOS said he thought there had been, to put it mildly, somewhat of an over-interpretation of what the Prime Minister had actually said, as he thought the vast majority of the media recognised. He had been talking about the whole issue of choice in relation to the NHS and had stated that "This is a prerequisite for continuing public support for the tax increases required for funding equitable public services" i.e. the NICs rises which had already been announced.
Questioned as to whether the Government was happy with the way the burden of taxation was spread, the PMOS reiterated the fact that this Government was about enterprise and fairness. It was about making work pay for those at the bottom through the measures we had taken with the introduction of the National Minimum Wage and tax credits, for example. Equally we were encouraging and rewarding enterprise because that was the way to have wealth creation and a dynamic economy. Both were central tenets of this Government’s economic philosophy and went hand in hand with each other, so the answer was yes.
Asked if Downing Street agreed with Peter Hain’s assertion on the Today Programme this morning that he was entitled to ask for an honest debate about the issue of tax, the PMOS said that there was a continuous debate in politics about all sorts of issues. However, both the Prime Minister and the Chancellor, through the Treasury, had made it clear where they stood in relation to this particular debate. Asked if he was implying that Mr Hain was not entitled to ask for a debate about tax, the PMOS said that politicians were perfectly entitled to express their thoughts about all kinds of issues. However, if people were saying - on the basis of Mr Hain’s speech - that the Government was going to break its manifesto pledge on tax, it was important to be clear that this did not represent the view of the Prime Minister, Chancellor or indeed the Government as a whole.
Questioned repeatedly as to whether Downing Street had asked Mr Hain to remove the offending passage from his speech this evening, the PMOS said that he had no intention of getting drawn into a discussion about the internal workings of Government. It was clear where the centre of gravity in relation to this issue lay. People should exercise a little patience and wait for the actual text. Asked whether Downing Street would view it as an act of defiance if Mr Hain decided not to remove the passage, the PMOS said that it was important to wait and see what text would be issued. He reminded journalists that, as was always the case with speeches that were pre-briefed, it was important to "check against delivery". Put to him that Mr Hain had quoted verbatim from his speech this morning, the PMOS said that people should be patient and wait for the text. There wasn’t too long to wait. He had had enough processology for one morning.
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