An autumn offensive by British Prime Minister Gordon Brown to revive his premiership with a package of economic measures could be overshadowed by the leak of a Home Office document that spells out how the downturn will lead to an increase in crime and greater support for extremist political parties.
Days after the Chancellor of the Exchequer Alistair Darling warned in a Guardian interview on Saturday that the economic conditions are “arguably the worst” in 60 years, the Home Office paper gives an insight into the government’s detailed preparations for the downturn.
The document, a draft of a letter from Home Secretary Jacqui Smith to Downing Street, warns that a downturn may lead to an increase in support for “far right extremism and racism”; a possible increase in the support for radical Islamist groups from people who experience racism and unemployment; an “upward pressure on acquisitive crime,” or property crime and an increase in public hostility toward migrants.
The downturn could also, however, lead to a fall in the use of cocaine and less drunken disorder in town centers, it said, unless drinks companies cut prices aggressively.
The leak of the document, which shows the government acknowledges there will be serious social consequences from a downturn, will irritate Downing Street after a difficult weekend.
Darling was forced to record an unscheduled television interview on Saturday to calm the atmosphere after his Guardian interview prompted speculation of a rift between the two most senior members of the Cabinet. His frank remarks about the state of the economy, contrasting with the prime minister’s mild language, prompted Tory claims that the government was “dysfunctional.”
Downing Street and the UK Treasury insisted there was no tension between Brown and Darling, claiming they were focused on measures to help people struggling with the downturn.
The first initiative will be announced tomorrow when the government unveils plans to help millions of less well-off people gain — or at least not lose — a place on the housing ladder. This is likely to include a “shared equity” plan in which local authorities and housing associations help borrowers in return for a stake in their homes.
Next week, ministers will unveil plans to help people with rising fuel bills when the first Cabinet meeting of the new season will be held in Birmingham. This is expected to include measures to improve energy efficiency.
In a speech to the Confederation of British Industry on Thursday, Brown is expected to underline the depth of the global economic problems that demand a global response.
“The credit crunch has shown that while we now have a global economy that is more integrated than ever before, from which no national economy is insulated, we do not have adequate means of managing it other than as nations or regional entities,” he is expected to say.
But Brown will also say that Britain is well-placed to weather the downturn: “In the next 20 years the world economy will double in its size and wealth and we have a great opportunity to win new business, new jobs and prosperity for Britain.”
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