Jon Walker: Currying favour with the backbenchers

Oct 10 2008 By Jon Walker

Curries have played an important role in Gordon Brown’s career.

Birmingham and Black Country MPs hatched their plan to force Tony Blair out of office over a curry at the Bilash, in Wolverhampton, paving the way for Mr Brown to take over.

And it seems that the £500 billion bail-out of Britain’s banks was cooked up over a takeaway curry on Tuesday night.

The Chancellor, Alistair Darling, and his Treasury staff worked throughout the night, fuelled by a curry from Gandhi’s Indian restaurant, just across the River Thames.

Mr Brown was in his element as he set out and defended the proposals in the House of Commons on Wednesday. He sounded authoritative and earned enthusiastic and genuine cheers from his party – something that hadn’t happened for a long time.

Conservative leader David Cameron faced the difficult task of supporting the Prime Minister, having pledged to put party politics aside for the sake of the nation, while still finding something interesting to say.

He tried to resolve the dilemma by calling for an end to “indefensible bonus packages” in the banking sector. This may reflect public sentiment at the moment, but even for the new, compassionate Conservative party, attacking city bonuses seems a little out of character.

It was good for Gordon Brown and not so good for David Cameron. What it means for the rest of us isn’t so clear.

Announcements from local authorities yesterday that they had cash invested in Icelandic banks which have hit the buffers emphasised the fact that the credit crunch will have consequences nobody can foresee.

It seems that West Midlands authorities are not affected too badly, although Solihull had around £3 million tucked away in Iceland’s banks, while Wychavon District Council, in Worcestershire, had £1.5 million. Wyre Forest, also in Worcestershire, had deposited £9 million, while East Staffordshire Borough Council had £4 million.

Spare a thought for council-tax payers in London, where local authorities have invested tens of millions which they may not see again for some time, if at all. The Metropolitan Police Authority had deposited £30 million in an Icelandic bank.

We still don’t know to what extent the “real” economy will be affected. Most of us do not work for banks, and although unemployment is rising, the increase has been fairly modest in historical terms.

Steve Radley, chief economist of the Engineering Employers’ Federation, this week delivered a surprisingly upbeat account to the Commons Business and Enterprise Committee, reporting that firms felt “a disconnect” between the chaos in the banking sector and their own performance.

Manufacturers had learned to be “resilient” in recent decades, and had found new markets in the middle east and Asia to replace lost trade with Europe and America, he said.

However, he also expressed concern that this disconnect won’t last forever, and that must be what worries us all.

Some of the adverts in our newspapers and on television screens are already referring to harsh economic times, promising potential customers that their local supermarket understands what they are going through.

But we haven’t seen anything yet. If the banking crisis does filter down to our high streets and factories, it’ll mean more than needing to save a few pennies at Asda.

Right now, Gordon Brown, and David Cameron for that matter, are in the same position as the rest of us. All they can do is cross their fingers and hope.