Labour spin doctors put gloss on Millbank move

Millbank, the Labour HQ whose name inspired fear and loathing inside and outside the party, could soon be no more than a political memory.

Under plans announced yesterday, Labour is preparing to quit its infamous central London home in favour of a down-to-earth office block in North Shields, Tyne and Wear.

The move, which was relayed to Millbank's 140 staff by officials, has been prompted by a threatened rent rise to nearly £1m a year. "We cannot afford to spend such a proportion of our income on rent," said Margaret McDonagh, the outgoing general secretary.

Offices for press, policy and the general secretary are expected to remain in London, but other functions such as distribution and printing, election staff, local government and conference organisation will move to a new National Support Centre. Labour already has a call centre in North Shields, which it used to great effect for nationwide telephone canvassing during the general election last month.

Throughout the 1980s, Labour was housed in Walworth Road, London in a building owned by the trade unions, but moved to the more modern Millbank Tower in preparation for the 1997 general election.

When the party moves out, it will mark the end of an era in which Millbank became synonymous with control freakery and ruthless efficiency. Although the party occupied only two floors, it often appeared to the media and its own MPs that the tower overlooking the Thames was more powerful than Parliament.

True to form, Ms McDonagh used her own Millbank spin to portray the move as a valuable chance to reconnect with the party's grass roots. "This financial imperative is an opportunity to really think about the party we are and need to be during this term when delivery will be all important. That delivery does not just happen in Westminster, it happens in communities where people live," she said.

The GMB union, which represents Labour employees, said it would hold urgent talks to ensure favourable redundancy terms for those unable to relocate to the North-east.

Labour has usntil next month to decide whether to extend its lease or to vacate the premises by September 2002.