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Putsch fizzles, Brown to lead Labour into vote
Jan. 07, 2010 17:33 GMT

Published by Reuters, Yahoo, New York Times

Matt Falloon (Additional reporting by Girish Gupta, Tim Castle, Kate Holton and Keith Weir; editing by Philippa Fletcher)

LONDON (Reuters) - An attempt to oust Prime Minister Gordon Brown appeared to have fizzled out on Thursday, leaving a battered Brown to lead his jittery party into this year's election.

Brown called the challenge to his leadership "a storm in a teacup," saying he had the full backing of his cabinet after two former ministers called for a secret ballot on his future among Labour MPs.

Only months before an election, which is expected to end Labour's 13-year rule, Wednesday's plot could not have come at a worse time for Brown, especially as his poor opinion poll ratings have been showing signs of improvement.

Labour's popularity has been hit by a deep recession, an increasingly unpopular war in Afghanistan and a scandal over politicians' expenses.

Business Secretary Peter Mandelson said voters were far less interested in the plot than the government's latest plans to bring the economy out of recession.

"That is what people around the country are really concerned about," he told Sky News after the launch of an economic recovery strategy with Brown. "It was a two-hour wonder that fizzled out, it was a small day of minor madness and today we are getting on with our day jobs."

PRESSURE ON STERLING

Political analysts say the Conservatives have failed to build up a big enough poll lead to guarantee a parliamentary majority in the election, expected to be held in early May.

Having seen off a second coup attempt in little over six months, Brown's position now looks secure at least until the election.

"It will have diminished his authority to the wider public, but within the Labour party it may well strengthen his position in the run-up the election because the attack seems so ill-judged," said Justin Fisher, professor of political science at Brunel University.

Party officials said many Labour politicians were "fire and brimstone angry" over the call from ex-Defence Secretary Geoff Hoon and ex-Health Secretary Patricia Hewitt for a ballot, fearing it might undermine the party's pre-election campaign.

However, concern over Brown's leadership put pressure on sterling for a second day, with markets already on alert over Britain's fragile economy and sizeable budget deficit, set to top 12 percent of gross domestic product this year.

"This adds to a list of concerns including fiscal issues, and fears of a sovereign rating downgrade," said Mitul Kotecha, global head of FX strategy at Calyon in Hong Kong.

Brown earlier told a local radio phone-in programme he was unfazed by the plot and getting on with doing his job.

"This is a bit of a storm in a teacup," he said. "We are actually dealing with real storms at the moment."

Britain has suffered unusually cold weather this week, heavy snow and ice severely restricting air, rail and road travel and forcing thousands of schools and businesses to close.

The drama in parliament on Wednesday appeared to pass many potential voters by.

"I'm working outside today. It's too cold and I couldn't care less about the government," said 27-year-old electrician Dave Jones, working in south London.




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© Girish Gupta