Labour braced for poll defeat

Gordon Brown is bracing himself for a setback when the result of yesterday's parliamentary by-election in Norwich North is announced today.

The Tories are expected to win the contest, caused by the resignation of the former Labour MP Ian Gibson after he was banned as an election candidate during the controversy over MPs' expenses. He had a majority of 5,549 at the 2005 election. The Tories are quietly confident. Last night, they played down speculation that they would secure a big majority.

Mr Brown's allies hope defeat will not spark another bout of damaging speculation about whether he should lead the party into the next election.

Today, count organisers said the turnout was around 45 per cent.

Yesterday, the Chancellor, Alistair Darling, told the Cabinet that the economy was showing some promising signs but there was "no room for complacency". He said that the world's major economies must continue to work together in the face of continuing uncertainties in the global economy.

The Cabinet, meeting in Cardiff, discussed a package of measures to tackle youth unemployment which will be unveiled next week. Yvette Cooper, the Work and Pensions Secretary, said the Government must do all it could to prevent "a spiral of decline".

She said it would launch a joint campaign with business, trade unions and charities to give those leaving school and university a chance.

Mr Brown said the Government would ensure opportunities for young people "so that we never again have a lost generation as we had in the 1980s".

The Norwich North declaration is due about lunchtime.