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Campbell on Campbell

The feared former spin doctor reflects on what the latest instalment of his diaries reveals about hi

"Nobody can accuse you of writing a self-serving memoir," said Jonathan Powell when he read my diaries four years ago, during the official vetting process for The Blair Years. "You come over as a complete lunatic," said the then chief of staff to the prime minister. Harsh. That I kept such a diary, however, does suggest a manic-obsessive tendency.

Reading the account of Labour's first two years in office, from a distance of 13 years, I find myself wondering how I ever found the time to write it. The entries suggest long hours packed with the planned and the unexpected, a jumble of issues, meetings and personalities - it gives me a headache just to think of them today. My mood was not always good, my judgements were sometimes too harsh and my demands of others - not least my partner and my staff - were excessive.

I usually wrote late at night in a combination of shorthand and scribble; sometimes I worked on it first thing in the morning. The second volume to be compiled from these writings, Power and the People, is a big book and my diary is a large body of words. Almost 80 per cent of the material here was not in my first book of extracts, The Blair Years. But even this is far from a complete account of the time - it is told very much from my perspective. This has its advantages: my training in journalism, I hope, gives me a good eye for detail. Of greater importance is that I was always at, or near, the centre of power. Cherie Blair used to complain that I spent more time with her husband than she did.

But the diaries have their limitations. Because I was press secretary, they do, at times, suggest an excessive focus on presentation at the expense of policy. That this impression took hold did the government no service, yet the questions that it raises about the impact of the modern media on government and politics are real.

Our efforts to improve Labour's systems of co-ordination were sensible and long overdue, if not always easy to implement. But that we allowed them to become such an issue, as we sought to dominate the debate so aggressively on our terms, suggests that we took into government an attitude that we should have left at the door of No 10. I am not taken with much of what the new government is doing but I rather admired its message over Christmas and the new year, which appeared to be: "We're on holiday. See you when we get back."

Glory days

The second volume of my diaries covers Labour's honeymoon period, sometimes said to have been the longest in history. Yet it is possible to spot the first signs of trouble, even in the early days of government, that would result in our media relations becoming a running sore. I was also surprised to see that, just days in, I was thinking about leaving.

The broader political context, as well as my moods, explains the disjunction between the nervousness we felt and the all-powerful, all-conquering machine that many people seemed to think we were. We had come in from a long period of opposition, during which time the media had done Labour much damage. We were not always sure about the civil service's capacity or desire for change. Tony Blair, in particular, was worried about the party's ability to adapt to the rigours of government. So we centralised considerably, and a lot of that centralisation ran through me.

Yet, in trying to make sure that we set the agenda, we sometimes lost sight - or certainly I did - of the difference between the important and the urgent. The pressures of the 24-hour media, to which I don't think any democratic government has adapted well, force one to be immediate and tactical. But government should always be strategic. As the diary is a day-to-day account, it is not easy to discern a clear, driving strategy throughout. Time and again, whether managing new relationships in Europe, chairing the G8 and the EU simultaneously, supporting Bill Clinton at the height of his difficulties or dealing with the death of Diana and the personal and political scandals that came our way, TB showed exceptional qualities. But all of these took time, effort and energy and, to some extent, took us off our main strategic course.

On public-service reform, for example, Blair became more strategic as his premiership went on, and yet less popular. It is hard to drive through change without not just the mandate of the electorate, but also its consent.

The diaries raise the matter of how leaders seek to balance conviction and consent. People always say that they want politicians to show the courage of their convictions, but when they do, they tend to be portrayed as arrogant and out of touch. President Barack Obama struggled with this problem in his first two years, as TB did, particularly in the later stages of his premiership.

TB has acknowledged that we could have done more to effect domestic reform in the first term, when the consent for change was there. But so many events - good and bad, planned and unplanned, political and personal - seem to have crowded in. We did a great deal to reform the economy: notably, we gave the Bank of England independence and introduced the New Deal, the minimum wage and Sure Start. We started to improve public services. We delivered devolution to Scotland and Wales.

But these do not come across as the dominant missions of the time. If anything, Northern Ireland does. Transcribing the diaries seven years ago, after I had left my full-time position in Downing Street, was largely a chore. But every now and then, I would come across something that took my breath away. One entry, written 11 days after the May 1997 election, reads: "TB said he reckoned he could see a way of sorting the Northern Ireland problem." There is a wonderful boldness to that. On this matter, he was always strategic yet also completely focused, relentless and determined never to take no for an answer.

As well as living these events, I have relived them many times in the writing and editing processes. But, to this day, I cannot fully work out how the Good Friday Agreement came together. The day that it did was one of the best I spent in TB's company.

The diary includes as detailed an account as I could give, but I am not sure if any of us knows the full story of what was going on when the parties reached an agreement. Of course, it was just the beginning, not the end - the Omagh bombing was an attempt to blow the agreement apart. It still moves me to read of its aftermath and the visit by Blair and Bill Clinton.

Northern Ireland and Kosovo were two of TB's finest hours. They are also areas where I feel that the much-derided "spin" with which I became synonymous was put to good effect. The former Irish prime minister Bertie Ahern once said that there were times when it was only what my counterpart Joe Lennon and I were up to, keeping the media busy, that gave the politicians the space to keep the show on the road. Kosovo was a war that was not going to be lost militarily, but as this volume ends we are losing the public relations war - something that we put right, slowly and steadily.

This book is not a paean of praise to anybody. I hope instead that it captures the essence of the events and characters within it. Clinton comes out well. Gerhard Schröder starts to do the same, but fades away. Jacques Chirac is a mixture of charming and infuriating. Nelson Mandela remains one of the few people still able to make the hairs on the back of my neck stand to attention. The memory of Boris Yeltsin always brings a smile to my lips.

On the domestic front, the so-called big guns of the days in opposition continue, throughout the diaries, to fire at our opponents, but also at TB and at each other. Gordon Brown is brilliant but also impossible. John Prescott is insecure yet decent and loyal. Robin Cook "diddles" a lot but is superb.

“Big beasts" have always had a role in politics and always will. But as a result of the power that our beasts wielded and used - and our attempts to manage this as best we could - talent perhaps did not develop in certain departments as it should have, and that had an impact later.

Judgement of history

In all of this, politics is not that different from other walks of life. What sets it apart is the scrutiny, intensity, scope and importance of the decisions being made. Politics and government have always been about ideals and ambition, service and self, policy and personality.

America's greatest president was Abraham Lincoln and my favourite book about politics is Doris Kearns Goodwin's Team of Rivals, which chronicles how Lincoln came to power and how he governed. Sometimes, I wonder how he and his rivals would have fared if they had had the 24-hour media chronicling and analysing their every move and word.

Ronald Reagan's speechwriter Peggy Noonan once wrote that being president is like painting a portrait that is made up of thousands of tiny actions and decisions, which together make up the final picture. My diaries are a fragment of that picture, in so far as it relates to a British prime minister.

I think that history will be kinder to TB than the judgement that many in the media pass on him now. Even when my whole diary is published, it will tell only part of the story. But I am confident that this is as close as it gets to recording what life was like at Blair's side during a remarkable period in British history. I am not sure a diary can do much more than that. It can be a contribution to history, but it can never be a definitive account of it.

“Power and the People", the second volume of Alastair Campbell's diaries, covering 1997-99, is published in hardback by Hutchinson (£25)

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Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.