A damaging rift has opened up at the top of the Labour government between chancellor Gordon Brown and prime minister Tony Blair over European tax harmonisation and membership of the party's ruling National Executive.
Link: FDs overwhelmingly reject EU tax harmony
Brown this week launched a strong attack on the draft European Constitution saying it could in present form lead to EU-wide tax harmonisation and a Federal Europe.
He pledged to fight any such moves.
The chancellor’s comments were seen in Westminster to be distinctly at odds with Blair’s claims that such issues were not involved in the document.
Then it emerged that the prime minister had twice blocked Brown in a bid to become a member of Labour’s National Executive which he wished to join in his job as one of the architects of the next General Election Manifesto.
Blair chose two junior ministers for the jobs instead.
Brown this week did not deny the story or hide his anger saying it was Blair’s decision: ‘He has made his decision. It’s a matter for him.’
The two disputes – and Brown’s public acknowledgement of the rift – were seen by senior party figures as a majorÿescalation of the simmering dispute between the two men sparked by Brown having to stand aside for his younger colleague as party leader in 1994.
There are fears it could severally damage the government with former Tory leader Iain Duncan Smith sniffing a leadership contest in Labour to follow his own ousting by his party.