Stephen,
Though it requires disagreeing with my friend LJ, I think I must add that the spring wrapped around the base seems quite necessary in order to return the brake pedal to the up position. Of couse. LJ is correct with regard to the position of the arm. It needs to be pulled off and rotated clockwise one or two points with respect to the internal star of the arm hole. Now, what is going to happen to the spring when you do this? If the spring is wound too tight where is sits in the picture, it may be just right once the arm is in the correct position. If it gets too loose when the arm is in the correct position, then the stop end of the sping might be deformed or stopped against the incorrect point.
In writing this, I'm asking myself if the arm position is just the result of worn shoes. I could be, but it almost doesn't matter (unless the shoes are dangerously worn). If the shoes are worn such that the arm is in the position shown, by adjustment of the cable, then the arm still needs to be repositioned to compensate for the wear in the shoes. Once the arm is back at the correct angle, work it to see how far the cam must turn to engage the brake. If it is a long way, you may need to go one more point clockwise on the star and preload the cam with the cable. At some point, this would become a clear indication of very worn shoes, maybe not making noise, but probabaly pretty close to it. In any case, they might be good enough to pass your dread MOT, so you can postpone replacing the shoes (just a very short time, please) .
Richard L.
P.S. As just a tiny tease, maybe change your topic to "MOT pending, just 50 more questions". They will be answered, even if, maybe, you should ask a mechanic to peek at your work.
