Chancellor George Osborne snatched defeat from the jaws of victory at the Conservative Party conference in Birmingham, writes Political Editor Jonathan Walker
It all started so well. On the first day of the Conservative conference at the ICC, William Hague delivered a barnstorming speech declaring that “New Labour is dead”.
No longer would Tony Blair’s election-winning machine dominate British politics. The Tories are in power now.
And activists gathered in Birmingham didn’t seem too upset about being in coalition with the Liberal Democrats.
When Mr Hague mentioned Lib Dem leader Nick Clegg, they cheered.
Delegates were also treated to a series of tasty policy announcements, including news on Monday morning that there would be a high speed rail link between Birmingham and Leeds.
But on Monday afternoon, it was George Osborne’s turn to speak.
Mr Osborne, the Chancellor, saved David Cameron’s bacon once.
Remember when Gordon Brown was popular? Believe it or not, it was only three years ago that the former Prime Minister was being lauded as strong, decisive and a welcome change from that nasty Tony Blair.
Things were going so well in 2007 that he even considered calling an early general election – one that he stood a very good chance of winning.
But then, George Osborne delivered his speech to the Conservative Party conference, and pledged to raise the threshold for inheritance tax from £300,000 to £1 million. It was seen as a vote-winner, and Mr Brown lost his nerve.
The election was called off, Mr Brown gained a reputation as a cynical ditherer – and he never really regained the respect of the public.
This time in Birmingham, Mr Osborne once again changed the mood of his party by announcing a new policy.
But it wasn’t a change for the better.
Axing child benefit for people on the higher rate of income tax – those earning £44,000 or above – was not a policy any Conservative relished defending on the doorstep.
Everyone understands that the (relatively) rich will have to suffer their share the pain caused by spending cuts.
But a simple increase in income tax (or the top rate of income tax) might have been easier to defend.
For many middle class parents, child benefit is the only benefit they ever get.
And while some households don’t actually need the money, there are families with a single income of around £44,000 a year, children and a mortgage, for whom child benefit makes a difference.
The announcement came at a time when smarter Labour MPs have twigged that they need to appeal to middle class voters in order to regain power.
Mr Osborne also announced a cap on the level of benefits that out of work families can receive - which would have been like a red rag to a bull for old-fashioned working class heroes.
But it was hard to find a Labour MP willing to offer a word of criticism about this proposal. Instead, Midland MPs such as Khalid Mahmood (Lab Perry Barr), Steve McCabe (Lab Hall Green) and Gisela Stuart (Lab Edgbaston) condemned the child benefit reform.
By Tuesday, the party spin machine had resorted to leaking details of the long-awaited marriage tax break.
Before the General Election, Conservatives pledged to give married couples who were basic rate taxpayers a £150-a-year rebate, but this idea had apparently been shelved when they went into coalition with the Lib Dems.
All of a sudden, it was back on the agenda and details of the proposed tax break were leaked to the press.
David Cameron was also despatched to the television studios to try to explain the policy to the public. He went as far as apologising to one reporter, saying: “Yes, I acknowledge this was not in our manifesto.
“Of course I’m sorry about that, but I think we need to be clear about why we’re doing what we’re doing.”
The row overshadowed the rest of the conference – even when Work and Pensions Secretary Iain Duncan Smith set out important plans to reform the benefits system so that people who find work aren’t suddenly hit by the loss of all their benefits.
His aim is to make certain people who work are significantly better off than they would be on benefits, tackling a problem Labour never had the courage to deal with.
Delivering his keynote speech to the conference on Wednesday, Mr Cameron insisted the child benefit reforms were fair.
He said: “As we work to balance the budget, fairness includes asking those on higher incomes to shoulder more of the burden than those on lower incomes.
“I’m nor saying this is going to be easy, as we’ve seen with child benefit this week.
“But it’s far that those with broader shoulders should bear a greater load.”
Will the public agree? Maybe – after all, most of us earn less than £44,000.
But this row may only be a taste of what the Government will face when the real cuts are announced, in Mr Osborne’s comprehensive spending review on October 20.