Prescott's outburst hits a raw nerve

JOHN PRESCOTT addressed miners at an open-air rally in Durham yesterday. He shared a platform with the union leader Rodney Bickerstaffe. Tony Blair spoke to the Labour women and youth conference in Scarborough. He was accompanied by the perfectly coiffured Lords leader Baroness Jay.

These speeches were meant to prove that the Prime Minister and his deputy are at one. But although there was only 50 miles between the two events, they were worlds apart.

As Mr Prescott told Mr Blair when they met for their pre-cabinet tete- a-tete on Thursday, the Labour Party is a coalition of traditions and classes - and its leaders must never forget it. Yesterday, the Deputy Prime Minister said the Government must remember both "the family on the council estate" and "the man in the Volvo estate". He made clear to the Cabinet that this is a theme he intends to reiterate when he is left in charge of the country over the summer.

Superficially, the Prescott message appears similar to the Mandelson mantra that Labour must not abandon the coalition between old and new. But the emphasis, and the context, is different.

While the former Secretary of State for Trade and Industry warned the party against being panicked into abandoning those in the Volvo estates, the Deputy Prime Minister is bridling about the perceived push to dump those on the council estates. He is coming from the same place as the Trades Union Congress leader John Monks, who accused the Blairites of treating traditional Labour supporters like "embarrassing elderly relatives".

The Deputy Prime Minister always gets crotchety at this time of year - two summers ago he memorably compared Peter Mandelson to a crab - but this time his outburst is being taken more seriously at No 10 because it has hit a raw nerve. In the wake of the disastrous European elections, Labour strategists are agonising about how to hold the disparate strands together. Mr Prescott's intervention shows the battle for the soul of the Labour Party is far from over.

In Whitehall, there is a growing sense of "pre-reshuffle tension", as one cabinet minister called it last week. Senior ministers have been urging the Prime Minister to bring forward his ministerial shake-up so the Government can put the back-stabbing and speculation behind it and get on with some work. But Mr Blair looks more likely to hold the changes until around 27 July.

As Parliament winds its way wearily to the long summer recess, Mo Mowlam has let it be known she expects to be moved from the Northern Ireland Office, and Frank Dobson has made clear he does not want to leave the Department of Health to stand as London mayor. As usual, Mr Prescott has, in the words of one of his ministerial colleagues, been getting increasingly "hot and bothered".

The Prime Minister's criticisms of the public sector - to a group of venture capitalists no less, a red rag to the bull - infuriated Mr Prescott but they were not the real reason for his outburst. It is no coincidence that on the same day as addressing public sector workers he also attacked the "faceless wonders" he believes have been spinning against him.

A succession of pre-reshuffle newspaper stories about Mr Prescott have suggested he is failing to make a difference in his transport portfolio, floating the idea that his giant department could be broken up and even proposing he might be "promoted" to the Home Office to allow the Government to get a grip on Britain's roads.

At one point, the Deputy Prime Minister was so angry about the negative reports that he got his office to scour the transcripts of Alastair Campbell's briefings to lobby journalists, which are circulated to departments around Whitehall, to make sure the press secretary was not the source of the stories.

Mr Prescott was also furious about reports suggesting his Old Labour ally Frank Dobson might be sacked. "He's become increasingly irritated," one friend said, "and last week he just lost his rag."

Lots of things could have tipped Mr Prescott over the edge. But it was inevitable that he would flip when Mr Blair said last Tuesday he still bore on his back the "scars" of trying to modernise the public services. As Mr Prescott got up, glowering, to address the local government conference the next day, he turned to aides and muttered that he planned to set a few things straight. Far from baring his scars, he spoke of the "civilising" influence of the public sector and lavished praise on its workers. "I'm glad I got that off my chest," said the Deputy Prime Minister as he sat down.

Downing Street now admits Mr Blair's ad lib to the business-men was a mistake - it was over the top and sneering. But his comments reflect a genuine frustration that the implementation of government policy is taking far longer than anyone expected.

This year Mr Blair's reshuffle will be closely scrutinised to see whether he shows greater commitment to New Labour ministers or traditional politicians. The Prime Minister is all too aware of the importance of holding together Labour's uneasy coalition.

"John Prescott always shoots from the hip," one minister said. "It's just that this time he has hit a rather sensitive target."