In Depth

Mandelson sends Ed Miliband a late Valentine’s card

But can he help boost Labour’s economic credibility when Ed Balls is fretting over gardeners’ receipts?

The Mole

Lord (Peter) Mandelson has sought to repair the recent damage inflicted by Blairites on the Ed Miliband campaign wagon by fully endorsing the Labour leader’s strategy for jobs, investment and business even before Miliband has unveiled it.

Mandelson, Tony Blair himself and New Labour followers such as Alan Milburn and John Hutton have angered Team Miliband in recent weeks by suggesting that Labour would lose the general election if they continued to fight on an agenda they – the Blairites - considered too left-wing. 

Now Mandelson has posted a late Valentine’s card to Miliband in the shape of an article for The Guardian in which he embraces Miliband with metaphorical hugs and kisses and, in particular, seeks to absolve shadow chancellor Ed Balls from the Tory charge that he crashed the British economy into a brick wall when he was a member of Gordon Brown’s Cabinet. 

“When Labour left office in 2010,” Mandelson writes, “Britain was on the way to recovery from the banking crisis that had hit us two years before. Of course we borrowed more to keep the economy from free fall and we were right to do so.”

Nicholas Watt, The Guardian’s political correspondent, says Mandelson’s intervention will be warmly welcomed by Miliband, whose allies were upset by Milburn and Hutton’s recent attack on Labour’s current “anti-privatisation” approach to the NHS

Also significant is Mandelson’s absolute backing for what Miliband will unveil in a speech today in the West Midlands: a new “middle out” policy for UK industry, designed to include all sections of the economy - low-paid workers, too, - not just those at the top.

As Watt reports, the policy is inspired by Barack Obama’s campaign to grow the US economy “from the middle out, not from the top down”.

“Miliband will make clear that an effective industrial policy will only work if it focuses on boosting productivity – and rewarding hard work – at all levels of the economy. He will say that a future Labour government would offer tax breaks to employers who adopt the living wage and it would raise the minimum wage closer to average earnings – £8 an hour – by 2020.”

Mandelson’s support is “particularly significant”, Watt argues, because “he won widespread praise for crafting an industrial strategy during his period as Business Secretary between 2008-10 … without resorting to a 1970s-style corporatist approach lampooned as ‘picking winners’.”

The endorsement from Mandelson comes just a week after Tony Blair said he would do “whatever the party wants” to help Miliband win the election. Whether Mandelson’s intervention came as a result of a phone call from Blair we may not discover until the next wave of political memoirs is published. 

Whether it will help dispel the public doubts about Miliband/ Balls – rather than Cameron/Osborne - running the economy we might discover sooner.

Currently, despite a Labour lead in the voting intention polls, Miliband/Balls run way behind Cameron/Osborne when respondents get to rate their ability to run the economy.

Balls didn’t do his cause for economic credibility much good with his interview on the Andrew Marr Show yesterday when he somehow managed to take the ‘tax avoidance’ heat off wealthy financiers and put ordinary families in the firing line.

Homeowners, he said, had a duty to demand receipts for even the smallest cash jobs carried out by cleaners, handymen and gardeners.

“The right thing to do if you are having somebody cut your hedge for a tenner is to make sure they give you their name and address and a receipt and a record for the fact that you have paid them.’”

Asked by a stunned Andrew Marr whether he followed this rule himself, Balls replied: “Absolutely. That’s because I am the Shadow Chancellor and I’m extremely careful about these things.”

Tory MP Peter Bone was the first - and won’t be the last - to say it was “ludicrous” to expect people to collect receipts for such things.

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