VAT reduction = political genius
Ok, so whilst £2.50 for every £100 spent is not WooHoo exciting here is why this move, plus all the other possible announcements make total political sense.
1. Darling and Brown announce stuff, it works, they are hailed heroes and storm the election
2. Darling and Brown announce stuff, nothing works, Tories win the next election and inherit a tax nightmare, forced to put up taxes, everyone hates them again, Labour landslide at the next election
So there you go. 2.5% matters bugger all when most shops are already discounting at 20%+ but the political decision making seems obvious to me.