Badly wounded but unbowed, Gordon Brown won a temporary reprieve last night by shoring up his position with an emergency cabinet reshuffle.
On a day of high political drama that threatened to cost him his job, the beleaguered Prime Minister vowed not to "walk away", insisting he was the best man to tackle the economic crisis and clean up politics after the MPs' expenses scandal.
But Mr Brown is not out of the woods yet. There are growing demands by Labour MPs for him to quit in the wake of disastrous results for the party in Thursday's council elections. Labour lost more than 250 seats and was virtually wiped out in a swath of authorities across England. Labour won just 23 per cent of the vote – its lowest showing in a local election, trailing a humiliating third place behind the Liberal Democrats(28 per cent) and the Conservatives (38 per cent), with other parties on 11 per cent. Labour critics warned they would press on with their plan to force the Prime Minister to stand down when they return to Westminster on Monday. By then, they will have digested another terrible set of election results – for Thursday's European Parliament poll – to be announced tomorrow night.
Mr Brown will come face to face with his critics on Monday night when he addresses the weekly meeting of the Parliamentary Labour Party. That is seen as the next crucial hurdle in his battle to survive.
Bolstered by the support of his new Cabinet, Mr Brown hopes to win the breathing space to unveil new policies on the economy, public services and reforming the political system in the next few weeks. They will be drawn up by three new councils of ministers he will chair.
His allies will urge backbenchers to give the new Cabinet a chance to turn round Labour's fortunes. They were relieved that the rebels failed to hand in a "go now" letter to Downing Street as planned yesterday and hope the plotters will back off amid warnings that installing a new leader would force him or her to call an early general election that would be calamitous for Labour. Some rebels may give Mr Brown until the autumn – so that a new leader could name an election date next year, in the hope that the economy will improve by then.
Mr Brown endured a difficult day, and his reshuffle displayed weakness rather than strength. It was less radical than the one trailed by allies and promises of a big injection of fresh blood failed to materialise. The surprise resignation of the Blairite James Purnell on Thursday left him powerless to lever Alistair Darling out of the Treasury and install his close ally Ed Balls as Chancellor, as he had wished.
When he seemed to have pulled off a difficult reshuffle, there was a last-minute walkout by Caroline Flint, the Europe minister, who failed to win promotion to the Cabinet despite showering Mr Brown with praise when he was at his most vulnerable point on Thursday. In a scathing resignation letter, Ms Flint accused Mr Brown of running a "two-tier" government in which women ministers were kept out of his inner circle and treated as "little more than female window dressing".
Ms Flint, a close ally of Hazel Blears who quit the Cabinet last week, accused Mr Brown of being responsible for hostile media briefings against her. She told him: "Time and time again I have stepped before the cameras to sincerely defend your reputation in the interests of the Labour Party and the Government as a whole. I am a natural party loyalist. Yet you have strained every sinew of that loyalty."
Brownite MPs dismissed her complaints as a cry of frustration for not winning promotion. But her exit revived criticism of the Prime Minister's record on the way he treats women ministers.
Mr Brown also suffered another wave of resignations. John Hutton and Geoff Hoon left the Cabinet,. Margaret Beckett, the Housing minister, also stood down as did Tony McNulty and Paul Murphy. But only Ms Flint joined Mr Purnell in attacking the Prime Minister.
Nick Raynsford, a former minister, said ministers were falling "like leaves off a tree" as he joined calls for a change of leader. He said Mr Brown's authority was "draining away". Writing in The Independent today, the Labour MP Paul Farrelly attacks the Prime Minister's "machine style of politics" and says: "In the interests of the Labour Party, Gordon Brown should step down. We need a breath of fresh air." In another headache for Mr Brown, Ian Gibson, a Labour MP, who has been banned as a party general election candidate after an investigation into his expenses claims, resigned immediately. That will trigger a dangerous by-election for Labour, which had a 5,459 majority in his Norwich North constituency at the last election. Mr Gibson said he was "bowed but not broken" by Labour's ban but it was "untenable" for him to remain an MP until the general election.
Mr Brown admitted Labour had suffered a "painful defeat" in Thursday's elections and insisted he was not complacent or arrogant. He told a Downing Street press conference: "If I didn't think I was the right person leading the right team ... I would not be standing here." He added: "I will not waver. I will not walk away. I will get on with the job."
In the reshuffle, Alan Johnson, the man most likely to succeed Mr Brown if he is forced out, was promoted from Health Secretary to the Home Office. Lord Mandelson's role as Mr Brown's right-hand man was formalised as he won the title of First Secretary – which is Deputy Prime Minister in all but name.
Hell hath no fury: Caroline Flint’s resignation letter
I believe the achievements of the Labour Government to date have been monumental and you have played an immense part in the creation of those achievements.
However, I am extremely disappointed at your failure to have an inclusive government. You have a two-tier government. Your inner circle and then the remainder of Cabinet. I have the greatest respect for the women who have served as full members of Cabinet and for those who attend when required. However, few are allowed into your inner circle.
Several of the women attending Cabinet – myself included – have been treated by you as little more than female window-dressing. I am not willing to attend Cabinet in a peripheral capacity any longer. In my current role, you advised that I would attend Cabinet when Europe was on the agenda. I have only been invited once since October and not to a single political Cabinet – not even the one held a few weeks before the European elections.
Having worked hard during this campaign, I would not have been party to any plan to undermine you or the Labour Party in the run-up to 4 June. So I was extremely angry to see newspapers briefed with invented stories of my involvement in a "Pugin Room plot". Time and again I have stepped before the cameras to sincerely defend your reputation in the interests of the Labour Party and the Government as a whole. I am a natural party loyalist. Yet you have strained every sinew of that loyalty.
It has been apparent for some time that you do not see me playing a more influential role in the Government. Therefore, I have respectfully declined your offer to continue in the Government as Minister for Europe attending Cabinet. I served six years as a backbencher and, therefore, I am not unhappy to be able to devote myself to promoting my constituency's interests and to support the Labour Government from the backbenches.
This is a personal decision, which I have not discussed with colleagues.
Yours, Rt Hon Caroline Flint MP