Politics: Blair snubs Brown over chairing welfare committee

The Prime Minister has snubbed Gordon Brown, the Chancellor of the Exchequer, with a decision to stop him chairing the new ministerial group on welfare reform.

Anthony Bevins, Political Editor, reports on a frost in Downing Street relations.

The Chancellor is on the special ministerial working group on welfare reform - set up by the Prime Minister this week to take charge of the crucial policy area - and John Prescott, the Deputy Prime Minister is not. But Tony Blair has ordered that whenever he cannot attend, his place as chairman is to be taken by Mr Prescott.

An informed government source told The Independent yesterday that the unusual decision to keep Mr Brown out of the chair was quite deliberate, and an indication of the annoyance felt by No 10 over Mr Brown's recent conduct.

While Mr Blair has made light of the new biography of the Chancellor, in which it is made clear that Mr Brown feels "betrayed" by Mr Blair's decision to stand for the leadership in 1994, in breach of an alleged private pact, the Prime Minister's close friends are dismayed at what is seen as a display of poor judgement.

The biography, written by Paul Routledge, Political Correspondent of The Independent on Sunday, says Mr Brown believes he could have beaten Mr Blair, but that he decided to stand aside out of a self-sacrificial sense of duty to the party.

The Prime Minister has said publicly that there was no pact, and his supporters say it is nonsense to argue that Mr Brown could have beaten Mr Blair in 1994; history is being re- written.

More damagingly, however, there is a strong feeling inside No 10 that Mr Brown is actively engaged in a campaign to succeed Mr Blair as leader - even though there is no vacancy - and that campaign is damaging the Chancellor's ability to work as part of the ministerial team.

One authoritative source told The Independent that the Prime Minister had a very high regard for Mr Brown, and still regards him as a friend, but his involvement in the biography and his contribution to the debacle over lone parents' benefit had raised a doubt about his judgement. The sooner Mr Brown and his colleagues "settled down", the better.

Yesterday, the Prime Minister maintained the theme of his campaign for welfare reform with a reassurance that any change would "work with the grain of the British people".

Mr Blair said in an interview with the BBC Radio 4's Today programme that there was a continuing manifesto commitment to the universal state pension, which would be uprated in line with prices.

But he would not rule out a consideration of the future place of the state pension in the welfare system for the future, adding: "I'm not going to speculate on what is going to be in 25 years until we're ready to come out with proposals upon it."

A government source said that should not be taken as a threat to abolish the state pension, any more than a suggestion of public-private partnership on welfare should be interpreted as a threat to introduce compulsory second pensions - even for those who could not afford them.

The next stage of the programme, following consideration by the ministerial group, and a round-table review by the full Cabinet, will be publication of a Green Paper drafted by Frank Field, minister for welfare reform.

Within the principles set out in that paper - and subject to further public consultation - detailed proposals would then begin to emerge over the coming year on the various specific issues, like pensions and family benefits.