'There is no leadership election at this stage'

Brown and the Special Relationship

JON SOPEL: Chancellor, have the past nine years shown a special relationship with the United States or a one-sided one?

GORDON BROWN: No, a very special relationship and I think you've always got to put this in its historical context. The values that Britain holds important: liberty, democracy, fairness of treatment and the values that America holds to be important are very similar indeed and our histories show that, our experience in the First and Second World Wars show that - our experience in dealing with the Cold War show that, and I think you've always got to have, when you're looking at the special relationship between Britain and America, yes it's about people and individuals, but yes, it's fundamentally about the values that guide what we do both internally and what we do round the world.

JON SOPEL: But don't the British people see it slightly differently now? Didn't David Cameron get it right when he said we should not be slavish in our relationship with America? We have never, until recently, been uncritical allies of America.

GORDON BROWN: Yes, but the important thing is, since September 11th, the world did change. The world changed in that we saw that there was a terror threat, it had to be dealt with. It started of course in New York, here actually in New York, but it's also something that has caused a lot of, I think more than twenty thousand lives round the world, simply from al qaeda attacks and we've got to recognise that this is a common cause in fighting the war against terror, we've got to do it in new ways in the years to come and, and let's be honest, we've got to combine the military and the security and the policing, that guards against terrorism, with a battle of ideas that we've got to win in the next few years.

JON SOPEL: But what about the issue that we have been slavish? I mean, you know, President Carter, former Democrat President, "I have been very disappointed by the apparent subservience of the British Government's policies, related to the many serious mistakes that have been originated in Washington."

GORDON BROWN: You've got to understand this domestic politics being practised in the United States. I mean Jimmy Carter is a Democratic President. I think the important thing to say is whether it's on Guantanamo Bay or whether it's on the initial stages in Iraq, where we should have done more about the economic development of Iraq, we have made our views known, but you cannot disguise the fact that we're dealing with a new situation since September 11th. I believe that all countries, that are democracies and who believe in liberty, have got to come together, to fight that battle against terrorism. I believe in future years we will be judged by the vigilance of both America, Britain and other allies, in taking this fight, so that we can both deal with the immediate protection of our citizens, and what I think is probably going to become the central issue of the next few years, winning the battle of ideas, so that we can separate the moderate group of people who support Islam, from extremists, who are trying to exploit a religion for terrorist activities round the world.

JON SOPEL: But it's that whole question of the balance of the relationship. I mean the French and the Germans would say I'm sure, exactly the same things about how we shared the same values, but they found it possible to be critical at times, of US foreign policy. Whereas it is perceived that Britain has never said anything. Being scared to say boo.

GORDON BROWN: I don't think that is true of course because I've just mentioned Guantanamo Bay, where we've been pretty outspoken, and of course now President Bush has agreed that Guantanamo Bay should over time be closed. We've also been pretty clear about what happened in the initial stages of the reconstruction of Iraq. I mean I, as someone who looks at economies and looks at what might have happened, know that we could have done that better. But at the same time, please do not misunderstand where the issues fundamentally lie. We are engaged in probably one of the most difficult fights since the second world war. One that obviously is breeding a second generation of al Qaeda terrorists, one where I've just identified that round the world, there are al-Qaeda bases that have actually been responsible for more than twenty thousand people dying, in addition to what happened on September 11th. It's gone to London, it's gone to Madrid, it's gone to Asia, it's gone to all the different parts of the world. Now, it would be wrong in my view for us not to say that we stand solidly with America, in fighting this war against terrorist violence and militant extremism, that threatens for example, to abolish the State of Israel, threatens also of course, a terrorist war against all the cities of the world, and I think people should get this in its proper perspective.

Brown and Israel

JON SOPEL: Okay, let me choose a more recent example then. You mentioned Israel, were we right to follow America, many people believed slavishly in saying, let the Israelis do what they will, there is no need for an earlier cease fire?

GORDON BROWN: Well look, we all tried in the end to get that ceasefire, the ceasefire has happened. I think the most important thing here however is this - Tony Blair and I have been working with him on this, are determined that the root cause of what led to the violence both in Palestine and Israel and then in Lebanon, is a failure to get to a Middle East settlement between Palestine, the Palestinian authority and Israel. Now, I've been working with Tony so that we can actually have an economic peace plan here. I believe that there is a will on both sides to move an economic peace plan forward. I believe if the security issues could be resolved, then Mr Olmert, the Prime Minister of Israel and the Palestinian Authority, could move this forward, and I know Israeli business leaders, I know people within Israel itself...

JON SOPEL: But isn't the problem that we're not...

GORDON BROWN: ...who are prepared to push this forward. Now, we will push this forward.

JON SOPEL: Isn't the problem that we're not seen as an honest broker now? We are seen as being allied, firmly, Britain is being seen and America is being seen as firmly allied to the Israelis and in the Arab world we've lost a lot of influence.

GORDON BROWN: Well it's in the last few years, for the first time, the idea of a separate Palestinian State, side by side with the State of Israel, a safe and secure State of Israel, which is a precondition of any arrangement. It has been a policy accepted by America as well as one that is being promoted by Britain. Now that is the advance. The problem is, we have never been able to solve the security problems. That is an issue that has got to be outstanding over the next few months, but behind it lies, what is a British initiative, with the Americans and actually the Europeans, that were there to be progress and security, we could underpin a peace settlement, and just as in Northern Ireland.

JON SOPEL: Do you have any cause for optimism on this?

GORDON BROWN: Yes, because just as in Northern Ireland, when people thought that the return to violence meant not only insecurity, but the loss of prosperity and decided that they wanted to move forward, I believe in the Palestinian area, where there's 70% poverty, 30 or 40% unemployment and in Israel, where the cost economically is big, as well as the cost in security terms. There's a recognition that we need to do something. Now, I'm optimistic because I've had the meetings with the Palestinian leaders and with the Israeli leaders. I'm optimistic because I know there is money from all over the world that can be brought in to this area. I know that Tony Blair is going to be trying his level best to help deal with some of the security as well as the economic issues over the next few months, and this is Britain taking a lead in this case, and able to show that we can bring, in my view, this is the possible prize, the Palestinian Authority and Israel together on this issue.

JON SOPEL: Okay, let's talk about the style of government closer to home. You are regularly depicted as a control freak, centralising, totally un-collegiate, was one of the phrases, and yet you're the man who gave independence to the Bank of England, to set interest rates. What is the real Gordon Brown?

GORDON BROWN: Well the real Chancellor is the person who not only made the Bank of England independent and gave Executive power away, made the Financial Services Authority independent of government and gave that power away, helped to create the new competition authority, where we devolved power for competition decisions from government and it's now independent of government, created the regional agencies that took power from Whitehall and pushed that power down to the regions and of course championed Welsh and Scottish devolution, which was power taken from the centre and handed to people who could make the decision by elected parliaments, in this case, themselves. Now, that is what government ought to be about, power being devolved. Centralized power being broken up and I believe that in the next few years the next stage of that can be entered in to.

JON SOPEL: What does that mean?

GORDON BROWN: That, if you take the Bank of England, what we actually did when we made the Bank of England independent was two things. One is we gave Executive power away and I believe that in other areas we can do that. And if I just give you an example, the distinction between what happened before we made the Bank of England independent and after is that government still set the general policy, an inflation target of 2% now, but the administration of that was clearly in the hands of people who were better able to do it, free from short term political influences, able to take a long term view of what was right. Now, to separate the making of policy from the execution of policy, is something that I think is a model that we should look at in other areas of government as well. And I think you'll find...

JON SOPEL: I just keep saying like what?

GORDON BROWN: But I think you'll find over the next few years that we will see how we can both give power away, the Executive renounces power that it previously had, and that will restore.

JON SOPEL: Health Service.

GORDON BROWN: That will restore confidence in government and it will show a trust in government and while I'm not going to set out individual policies at the moment, I think you can see the way that I'm thinking, for the new politics of the next generation, for the challenges that we face in the future, the model of Bank of England independence offers us a way forward, because you give up power and you show that you are not anxious to hold on to powers that should be better administered or better dealt with by other people, and at the same time, you make this distinction, which governments, perhaps politicians have been reluctant to do, between setting a general policy guideline and letting people who are better able to manage, just get on with it.

JON SOPEL: This suggests to me that were you to become Prime Minister, you're looking at quite a fundamental change in our constitutional arrangements.

GORDON BROWN: I think it's possible to say that for the challenges we face in the future, where we've got people as individuals whose aspirations are rising, a huge amount of social mobility taking place, people demanding that services be tailored to the needs, far greater local accountability of what should happen, when a public service is delivered. And at the same time, the big challenges of the economy, that we've got to respond to global competition, we've got to make people feel more secure in a world where terrorism is a real problem, then government has got to change. Now, the way that government can change is first of all to recognise there are certain things you do, you do not need to do. And the way you change...

JON SOPEL: Can you give me any 'like what's?

GORDON BROWN: Well I've just given you the example of what we've done. The Bank of England, competition policy. I mean I've said myself that there's an issue about parliament making some decisions that the Executive already makes, for example appointments in certain areas. But I think you could take a broader sweep and looking at the policy making process generally. And I'll give you another example of parliamentary accountability where we haven't done as well as we should in the past. Take this issue of twenty eight days. We had a huge debate in the House of Commons about whether a person who was suspected of a charge and arrested, could be detained for twenty eight days or more. And eventually, a proposal that I thought was right, a ninety day limit to detention, it was rejected by Parliament, and so instead of the fourteen days, it became twenty eight days but not ninety days. Now, what happened here was that there was a basic misunderstanding about what Government was trying to do. You could have on security grounds, the strongest possible case where you have terrorist investigations cutting across continents, involving the internet, for extending the number of days that the police have to investigate that potential offence. But what you should have beside that is a constitutional change. That means that there is far greater parliamentary accountability for what is done. So you deal with the security issue.

JON SOPEL: Okay.

GORDON BROWN: But to deal with the question of whether there is arbitrariness in the way the police act, you have far greater parliamentary accountability. Now, that's what I mean about a constitution where the Executive gives up power, there is greater parliamentary accountability, and there's a greater distinction between government laying down general policy guidelines and letting people who are better able to make decisions get on with it. And I think people will see in the times to come that, whether it be in the areas of government I've talked about or in other areas, there is merit in moving forward in this way.

Brown liberated?

JON SOPEL: Just listening to you, you sound different, you sound almost liberated by events of the past weeks. Is that fair?

GORDON BROWN: No, I've been thinking about these for some time.

JON SOPEL: But you weren't expressing them.

GORDON BROWN: Well I - if you look at what I've been saying over the last few months, I've been talking about liberty and the Constitution. I've been talking about how we can actually deal with a more responsible community, and obviously, in government your ideas formulate about what should happen next. And I tell you I'm more...

JON SOPEL: But the fact that Prime Minister has said that he's going to be gone by next summer and that there - you know that there is going to be a - we've got a timetable, does that feel liberating for you, in that you - we know there's going to be a contest, you can talk about all these things?

GORDON BROWN: No, I want Tony Blair to be able to make his own decisions about what he wants to do and for him to announce them and I will support them. As far as the future is concerned, yes, we've all got a responsibility say, look, this is a government that has done these things over the last nine or ten years. Here are the changes that we've been able to make. But look, this is a different world. It's not just terrorism and insecurity, it's also global competition and the pressure on British economy. It's new medical advances, that make you change your idea about healthcare. It's big changes that are taking place in, in communications. Now, we have got to have new policies for new times, and I think we'll be able to show over the next few years, that we can combine the experience that people can trust, with also the new and fresh ideas that are about the future.

Brown the plotter?

JON SOPEL: And just dealing with these past few weeks. If they've been liberating on one hand, do you think they've been in any way damaging to you, that you have been seen as a plotter?

GORDON BROWN: Well, if people want to say that, they're wrong. And I've always made it clear that Tony Blair, because of the job that he's done, because of the character of the man, because of the respect in which I hold him, should be free and I think the Party would like this, to make his own decisions about what he does, does. Look, you've been dealing with a unique situation, a Prime Minister that says that he's not going to stand at the next General Election as a leader of his party. There's undoubtedly uncertainty, but my position has always been that Tony Blair should be free to make his own decisions and I think that's where the position is at the moment. He'll make his own announcements in his own time.

JON SOPEL: Sure, but let's take one example. You know, Tom Watson, a Junior Defence Minister, a prot�g� of yours, coming to see you, apparently to deliver a present for the baby and you don't talk about anything else and yet the next day he signs a round robin letter, which ultimately is going to require him to resign from the government.

GORDON BROWN: Yeah, I knew nothing. I knew nothing of that letter. ..

JON SOPEL: Was he wise to have done it?

GORDON BROWN: Well, I think it was a mistake...

JON SOPEL: Disloyal of him?

GORDON BROWN: He probably, reflecting on it, may wish to change his mind, but the important thing is this. I have always said, and all my friends know this, that Tony Blair should be free to make his own decisions about what he does and make his own decisions that I would support and I have supported and I think you can strip away all the events of the last few weeks. At the end of the day, Tony Blair has been a great Prime Minister, he's been a great leader of the Labour Party. I've worked with him for more than twenty years and I think it's important that he's in a position to make the decisions that he wants for the future.

Brown New Labour on NHS?

JON SOPEL: Another suspicion that you hear from some people around the Prime Minister is that maybe you're not really as signed up to some of the reforms as he is. I mean they give...

GORDON BROWN: Well, I don't know what you're talking about because...

JON SOPEL: Well, okay, let me give you one.

GORDON BROWN: ...most of the reforms have either been done jointly or in some cases the Treasury has led and in other cases Tony Blair has led.

JON SOPEL: Is there any limit to the role of the private sector in the health service?

GORDON BROWN: I think there are limits to the role of the private sector in the health service that we've set down as a government, because essentially, the private sector is doing part of the job of the health service but not all of the job of the health service and I think most people would accept that and I think in America of course, a very large part of the health care system is, is also either managed or financed publicly as well.

JON SOPEL: But Patricia Hewitt more or less said there are no arbitrary limits.

GORDON BROWN: I don't think she'd put it like that. She issued a figure, I think which was in the order of 10 to 15%, but I don't think she's actually said that at all.

JON SOPEL: Well John Reid said that he thought it wouldn't go above 10 to 15%. She thought it was unlikely but said there should be no arbitrary limit.

GORDON BROWN: But hold on. You're talking about the National Health Service of Britain and you're talking about major reforms that we bring in, bringing in that I support, bringing in private finance to build hospitals, bringing private contractors to do certain goods. Having a range of, sort of options that are available to the health service, to buy from the private sector and of course the health service has always bought its drugs and its treatments from the private sector as well. But this is still the National Health Service, using private as well as public investment and I don't think anybody who's talking about the future of the health service within the Labour government is envisaging the total privatisation of the National Health Service. So in that way, I think Patricia Hewitt and I are saying that there are limits and the limits of course are that we are in a position to show that the National Health Service is working in many areas, but where it's not working we're prepared to take action to deal with it.

Dual Premiership?

JON SOPEL: Just on these final months of the Tony Blair premiership, is it essentially a dual premiership that's operating now?

GORDON BROWN: No, it's Tony Blair, who's the Prime Minister of this country, and it's Tony Blair who is making the decisions, and I think you'd be making a mistake if you put it that way at all. What I'm doing, and I think it's quite important to understand the distinction is, I'm setting out some ideas about how I see the future. I'm probably thinking about many of the challenges that the country are going to face, two, five tens years from now, where we've got to look at, as a government about what we might do and I'm setting down some ideas about how both government can work and how policy can change for the future. Blair to back Brown?

JON SOPEL: Do you think he'll endorse you as his successor?

GORDON BROWN: Well that's a matter, that's a matter for Tony. It's not, it's not something that I'm going to comment on is it.

JON SOPEL: But were you disappointed that he didn't when he made that statement?

GORDON BROWN: Not at all because look, you know, Tony is still leader of the Labour Party. There is no leadership election at this stage. There is no date, he's said he'll give a date at some future time and look, I'm not going to get in to this speculation about who's going to endorse who.

JON SOPEL: Lot of briefing, lot of briefing went on that when you had those discussions, which have been characterised in various different ways, before - prior to those statements being issued, that the one thing you really wanted was for him to endorse you as...

GORDON BROWN: I'm sorry...

JON SOPEL: ...his successor and that...

GORDON BROWN: I'm sorry Jon, you've got it all completely wrong. That was not discussed at these discussions. The discussions were actually about how I wanted Tony to be able to make his own decisions in his own way. And at the same time we had to look at what was going to happen over the next few months, the policy making process of government, how it would work and these were the central parts of this discussion. And whatever rumours and innuendos and all sorts of things come out of it, I think my goodness, I mean if you were to believe every story you read in the newspapers about what were relatively short meetings, you might have thought we met for two weeks.

Cabinet Challenger to Brown? JON SOPEL: Final question. Do you think you might face a cabinet challenger?

GORDON BROWN: Look, I've said I'll welcome anybody who wishes to challenge for the vacant post when it is vacant - leadership of the Labour Party. I think the Party benefits from an open and inclusive approach. I've said myself that I think it's important to have a Ministry of all the, cabinet and government of all the talents.

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NB:These transcripts were typed from a recording and not copied from original scripts.

Because of the possibility of mis-hearing and the difficulty, in some cases, of identifying individual speakers, the BBC cannot vouch for their accuracy.

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The Politics Show Sunday 24 September 2006 at 12.00pm on BBC One.

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