The threat level operates according to the following scale:
Low - attack is unlikely
Moderate - attack is possible, but not likely
Substantial - attack is a strong possibility
Severe - attack is highly likely
Critical - attack is expected imminently
The current policy was formed in the aftermath of the London Tube attacks on 7/7/2005. Only weeks before the bombing the previous measure had been lowered, so it was decided then that the level should be simplified and made public when it changed.
Apparently Alan Johnson made the public announcement in order to raise awareness. Independent Assessor Lord Carlile said the government has "decided that if you don't tell the public to be vigilant, they're not going to be vigilant," adding that he supported this view.
I disagree. I think this underestimates the vast majority of members of rational members of the public and completely miscalculates the potential for self-imposed problems arising from fear (which is the ultimate aim of the terrorist, after all).
I do agree that there should be an internal scale which can be used to coordinate official responses. However I would also add that the volatility of the scale is itself a measure of the failure of government to prevent terrorism and that this indicates the need for a change in policy.
As the Beeb helpfully provides a timeline of the threat level I think it's worth having a closer look at the changes.
On 1/8/2006 the terror threat was raised from 'severe' to 'critical'
14/8/2006: lowered from 'critical' to 'severe'
30/6/2007: raised to 'critical'
4/7/2007: lowered to 'severe'
20/7/2009: lowered to 'substantial'
22/1/2010: raised to 'severe'
During this period members a tranche of evermore imposing anti-terror measure have been introduced, as anyone who has attempted to go anywhere will be all too aware.
What I would say is that if the changes to the terror level are to be publically anounced then this should go hand-in-hand with variation in the stringency of travel restrictions - the public will understand there is a connection between the level of the terror threat and regulations, and will be more accepting of them as a result.
But if the restrictions continue to be imposed without any hope they will ever be lifted, while the threat level fluctuates wildly according to the state's ability to react to intelligence, then they are only building up more resentment to the never-ending slide into a police state.
So if the blanket imposition on banning liquids on flights or full body scans (or even for that matter the ban on photographing public buildings) are going to continue then announcements of variations in the threat level are redundant and should be kept internal, but if the announcements are to continue then the anti-terror measures should be varied accordingly.
It's a choice that has to be made, and it seem it is one that the Labour government is not prepared to take.