Blair handover: If not now, when?

The voices of protest against cash for honours are getting louder in Labour ranks. But the PM isn't packing his bags. Yet. By Marie Woolf

Towards the end of the meeting, at 8.30pm, hands shot up as the motion went to a vote. Some had argued passionately that the Prime Minister should set out a timetable to quit, to restore certainty to politics and to prepare the ground for an "orderly" handover to Gordon Brown. Others called for calm, and argued against forcing the Tony Blair's hand. It was this faction that won the day, and the call for a timetable for departure was soundly defeated.

Nevertheless, the fact that the vote had taken place at all will send ripples of disquiet through Labour Party ranks. After all, this was not a hard-left Labour constituency set on ousting the Prime Minister. This was the home turf of Geoff Hoon, leader of the House of Commons, and one of Tony Blair's staunchest public supporters.

On Friday, news of the motion had reached Mr Hoon, who as Secretary of State for Defence had played a key role in Iraq. His displeasure was communicated in no uncertain terms to members of the committee - with a warning not on any account to speak to the press about their challenge to the Prime Minister's authority.

What Mr Hoon did not know was that Ashfield is only one of the local Labour parties considering taking action to force the issue of when Mr Blair should go. Across the country, Labour activists, dismayed by the secret loans "scandal" - a word used even by the arch-loyalist Lord Falconer, the Lord Chancellor, last weekend - are beginning to ask whether the leader who delivered three election victories is becoming a liability to the party. In the Scottish seat of Stirling, the constituency of the minister for disabled people, Anne McGuire, members were privately debating whether to table a similar motion.

While the speculation about when Mr Blair would stand down has bubbled for years, the latest round of more serious speculation began with the Prime Minister's decision to nominate a clutch of millionaire donors as working peers. The revelation in The Independent on Sunday that the peers had also given Labour secret loans to fund the election campaign turned a mood of disquiet into a crisis.

"The whole honours thing has just gone on and on. It has been very damaging for us. Our people don't like to see us taking cash from people like this," said one member of Labour's national executive. "It's what the Tories get up to, not us."

For those who had doubts about Mr Blair because of the Iraq war, his reliance on Conservative votes to get the Education Bill through was deeply demoralising. For many, the loans scandal was the last straw and a sign that the Prime Minister was losing his judgement.

The long-awaited cabinet reshuffle, to fill a ministerial post vacant since David Blunkett's resignation in November, has still not happened. There was feverish talk in Whitehall of pre-Budget rows between the Chancellor and Mr Blair over pensions policy, and even wild suggestions that Mr Brown had deliberately discontinued the £200 council tax subsidy for old people in order to make the PM look bad. Relations between the two men were worse than ever. Informal talks about a transition were said to have stalled. The briefing and counter-briefing was getting out of control. Last night, the Chancellor's allies were bemused by a report in The Observer that Mr Brown had been axed from this week's launch of Labour's local election campaign. An aide said: "As far as we were concerned they were going to launch the campaign together in Crawley."

A No 10 spokesman added: "This story is untrue. No decision has yet been made."

In the Commons lobbies last week, there was an end-of-term atmosphere as MPs packed their bags to return to their constituencies for their long Easter break. But the talk in the corners of the ornate, 19th-century members' lobby, with Ramsay MacDonald's bust as witness, was not of holiday destinations, but of when Mr Blair should go.

In twos and threes, MPs talked through when a handover to Mr Brown should take place. Even MPs previously regarded as loyal to Mr Blair declared the "drift could not continue", expressing fears that the Prime Minister had failed to seize the initiative. The party machine, which under Alastair Campbell had set the pace on the front pages for years, seemed feeble and tired. Weeks of damaging headlines were taking the toll on the party. One government spin-doctor said: "We have been unable to shut this story down."

The coincidental timing of the Prime Minister's long-arranged official trip to Australia, New Zealand and Indonesia last week exacerbated the sense of drift. Some Blair aides, sensing the feverish atmosphere, had advised the Prime Minister not to leave the country while the party was in such a febrile state. But it was decided it would be a diplomatic faux pas to fail to attend the closing ceremony of the Commonwealth Games. The trip included an important speech on foreign policy and the first visit by a British Prime Minister to New Zealand for half a century. But conversation in the accompanying press pack was dominated by the puzzle of when the Prime Minister would leave office.

Mr Blair was asked on ABC television whether it had been a mistake to say he would not serve a fourth term. He accepted that "maybe that was a mistake ..." but was interrupted before he could finish. In the media hothouse, this half-sentence blossomed. Journalists agreed he had a date in mind but hadn't told anyone what it was.

Back home in London, the "cat's away" atmosphere became so serious that Labour whips, technically the Prime Minister's enforcers, were canvassing MPs informally about when he should go. Such treasonous talk was not confined to the corridors of Westminster or Portcullis House. One member of Labour's ruling body, the national executive, hoped that "God would have another word with Tony and convince him to go".

On Monday evening, at the weekly meeting of the Parliamentary Labour Party, with John Prescott presiding in Mr Blair's absence, the discussion spilled over to Labour concerns about the "loans for lordships" affair. The Chancellor listened impassively as Jon Trickett, the MP for Hemsworth, spoke for many when he called for the Government to examine "the timing and nature of the transition". Blairites thought this provocative. One MP remarked that Hilary Armstrong, the Chief Whip, had "an expression like a smacked cat".

Mr Prescott took it upon himself to try to stop rival factions tearing the party apart. He was equally upset by the briefings by Blairite supporters Alan Milburn and Stephen Byers, perceived by allies of Mr Brown as an attempt to derail his Budget, and by the calls from the left for Mr Blair to go.

But on Tuesday, as he stood in for the Prime Minister at the weekly meeting with backbenchers, it became clear that the pressure for an early handover was not ebbing. Joan Ruddock, the former minister for women, explained that MPs were worried that a handover of power would not be "orderly" if there was continued uncertainty about when it would take place.

Some MPs said that it was no longer good enough for the Prime Minister to adopt a Delphic attitude to a transition. He should say when he was going, to allow the party, and the Chancellor, to plan ahead.

"It doesn't so much matter when it happens, it matters how it happens," one ally of Mr Brown told The Independent on Sunday. "You need a timetable in the public domain - an early timetable setting it out publicly. There has never been any form of debate between Blair and Brown about the date."

At Prime Minister's Questions on Wednesday, Mr Prescott, standing in again, was asked by William Hague, standing in for David Cameron: "The Deputy Prime Minister was asked at the weekend when the Prime Minister would go and he said: 'I still think the timetable in people's minds is still reasonably the same.' What is the timetable?"

Mr Prescott replied: "That is for me to know and for him to guess." It won him roars of approval at the time, but later MPs wondered if their deputy leader knew something they did not. That evening, Ashok Kumar, aide to the Secretary of State for International Development, Hilary Benn, went public with his call for Blair to go "before 2008". Colleagues were shocked by his breaking the vow of silence among members of the Government and noted that he was not sacked for his comments, which some read as another sign that Mr Blair was losing his grip.

Blair allies insist that an overt challenge to the Prime Minister would make him only more determined to hang on, recapturing the party's attention with a bold measure. "It will be something about Europe or Africa or poverty. He'll do another 'saving the world' initiative to try to win people over," one MP said.

But local Labour parties are tiring of such tactics. A motion tabled by activists in Mr Hoon's loyalist backyard is only the first harbinger of trouble to come. Party managers will be powerless to prevent a number of local parties putting a motion to the annual conference in Manchester requesting a leadership election - the beginning of a formal challenge to the Prime Minister. Then the situation could slip finally from his grasp.

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