Brown plans cabinet reshuffle as ministers told to cut short holiday

Gordon Brown is planning to reshuffle the Cabinet in the first week of September in an attempt to re-assert his authority over his divided government.

All ministers are being told by Downing Street to return from holiday early next month. David Miliband, the Foreign Secretary, has already cancelled a visit provisionally arranged for that time.

The Prime Minister's instruction to be in London signals that a wide-ranging ministerial reshuffle is likely as early as 1 or 2 September. It would be followed by a meeting of the Cabinet where the new ministers hammer out a series of policy initiatives designed to win back disillusioned voters.

All eyes will be on Mr Miliband's fate in the reshuffle after he infuriated Downing Street this week by implicitly staking his claim for the top job.

The Foreign Secretary will not be sacked in the next reshuffle and some advisers are urging the Prime Minister to "lock" Mr Miliband into his top team by making him Chancellor of the Exchequer. Alistair Darling, who has endured a torrid year in the post, could swap jobs with him and move to the Foreign Office. One party source said: "If David is so interested in the domestic agenda and attacking the Tories, then this is the perfect job for him."

Mr Brown is also considering creating a post of deputy prime minister with Alan Johnson, the Secretary of State for Health, another potential leadership rival, likely to be given the job.

The Prime Minister is planning to elevate a number of ministers of state to the cabinet table. Front-runners for promotion include Liam Byrne, the Immigration minister, Caroline Flint, the Housing minister, Jim Knight, the Schools minister, and Pat McFadden, the Employment Relations minister.

Current cabinet members who could be vulnerable include Des Browne, the Secretary of State for Defence, Geoff Hoon, the Chief Whip, and Paul Murphy, the Welsh Secretary.

A cabinet away-day at Chequers is being considered for 5 September, a week before the original planned date for the first post-summer cabinet meeting. The new top team will use the occasion to plot Labour's fight-back.

Possible policy initiatives include a windfall tax on the excessive profits of energy companies and extra help for low-paid people who lost out from the abolition of the 10p income tax rate.

Mr Brown is preparing a frenzy of activity next month to see off any potential attempt by Labour dissidents to remove him. He will also be under pressure to deliver the speech of his life at the Labour conference on 23 September. Leading Labour officials are desperate for a period of calm in the party during August following the turmoil triggered by last week's disastrous Labour performance in the Glasgow East by-election.

However, John Hutton, the Business Secretary, hinted at disquiet in the Cabinet over Mr Brown's leadership yesterday when he warned the Government was "not doing well enough". He told BBC Radio 4's Today programme: "We have got to stop sounding miserable about ourselves and sounding as if we have been treated unfairly. We have not been treated unfairly. We are not doing well enough and that's what the voters have said." Asked about the Prime Minister's performance, he did not initially name Mr Brown and only when pressed did he maintain that Labour could win under his leadership.

Three in and three out?

Pat McFadden

The Employment Relations minister is a crucial and influential Labour fixer who has moved from Tony Blair's side to Gordon Brown's. He accompanied Brown throughout the meeting of Labour policy forum after last week's Glasgow East by-election crisis.

Liam Byrne

Initially viewed as a Blairite, the cerebral Immigration minister has won admirers in the Brown team for his work in overhauling the immigration system and removing some of the political poison from the issue.

Caroline Flint

Already attends the Cabinet as Housing minister but favourite to gain a full cabinet seat in her own right. Seen as a persuasive television performer. Could become Health Secretary if Alan Johnson is made DPM.

Des Browne

The Defence Secretary, who has struggled to make a mark in his current job, could fall victim to some Brownites' determination to reduce the number of Scots in the Cabinet in order to help win over voters in Middle England.

Geoff Hoon

A political survivor, the Chief Whip has faced criticism for not having done a good job of containing the summer in-fighting among Labour MPs, while his deputy, Nick Brown, is viewed by some in members in Parliament as "the real Chief Whip".

Paul Murphy

The Welsh Secretary and former Northern Ireland Secretary has had a distinguished government career. But the 59-year-old could be ruthlessly axed if Brown wants to bring in younger faces to his cabinet.

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