The Prime Minister told the NEC that the Chancellor's comprehensive spending review was "an opportunity to put us back on track and will define the priorities of the Government". Gordon Brown is expected to produce more money in July for Labour's two key commitments on education and health. Mr Blair said extra investment in schools and hospitals was necessary but not the only answer.
His remarks were seen as a clear signal that the spending review could confront the party with hard choices involving cuts elsewhere in public spending. He said he expected it to be "tougher next year than it has been up to now".
Mr Blair gave his warning as the NEC endorsed changes in the rules by 14 votes to 2 which could increase the leadership's grip on the party at Westminster, and limit the threat of backbench rebellions.
Dennis Skinner and Ken Livingstone voted against the leadership, and other left-wing Labour MPs were threatening to campaign at this year's party conference against the changes, which they protested would produce more "Blairite" MPs.
Mr Blair defended a change in the rules which will make it simpler for sitting MPs to be reselected by their constituency parties. For the first time, the whips will send reports on MPs' voting records to the NEC with the clear implication that trouble-makers will not be endorsed by the party leadership. "MPs consent to the whip before they come in," Mr Blair said.
The NEC is also proposing to set up an approved list of candidates for selection in seats where MPs retire or there is no Labour MP. The leadership insisted it would not stop constituency parties from choosing a candidate who had not been "pre-endorsed" by the NEC. However, such a candidate would face a "rigorous interviewing process" by the NEC.
Liz Davies, a former Labour candidate who was dropped by the NEC, protested: "Under these proposals every Labour MP who is selected will owe their job to the patronage of the Prime Minister."Reuse content