Mandelson tells Labour to refocus as Brown reels from Levy's attack

Gordon Brown has been told to "get back to basics" by senior Labour party figures who have warned that the Government needs to find a way of reconnecting with disillusioned voters.

As the Prime Minister prepared for the crucial first test of his leadership at the ballot box on Thursday, Peter Mandelson, the EU trade commissioner, joined senior cabinet ministers to rally round the Prime Minister, but said the Government must focus more on regaining public support.

To add to Mr Brown's troubles before the local elections across England and Wales, the former Labour fundraiser Lord Levy claimed Tony Blair did not believe Mr Brown could win a general election against the Tory leader David Cameron.

Two opinion polls at the weekend put Labour well behind the Tories. An ICM poll in the News of the World taken in 145 marginal seats where Labour faces a challenge from the Tories suggested a 9 per cent swing to the Conservatives since the last election, which would give the Tories a 64-seat majority if the findings were repeated at a general election. Another ICM poll in The Sunday Telegraph gave the Tories a 10-point national lead over Labour.

Mr Mandelson, one of the architects of New Labour, called yesterday on the party to "pull itself together and refocus" to win the next general election.

David Miliband, the Foreign Secretary, said the Labour Party faced "a test of character as well as a test of policy" and warned it would be "fatal" for the party to lose sight of its "core convictions". Jack Straw, the Justice Secretary, said it was self-evident that the party faced "some difficulties" in the wake of last week's climbdown over the abolition of the 10p tax rate.

Lord Levy criticised the Prime Minister's leadership, claiming Mr Blair believes his successor "could never beat" the Tory leader in a general election. In his new book, serialised in The Mail on Sunday, Lord Levy claims Mr Blair believed Mr Cameron had a "natural ability" to connect with Middle England voters "that Gordon would simply be unable ever to match".

He wrote: "But Gordon? He can't defeat Cameron, Tony told me."

Labour sources dismissed the report, which was denied by Mr Blair. A spokesman for the former prime minister said: "Tony Blair doesn't agree with the views attributed to him by Lord Levy and fully believes Labour with Gordon Brown's leadership can win the next election. Tony Blair said when he stood down that he would be 100 per cent loyal to Gordon Brown and that continues to be the case."

Mr Mandelson told Sky News: "I do think it is possible for Labour to win the next election but obviously the party and the Government in a sense have got to get back to basics; their basic convictions, their basic self-confidence and their basic unity. They have to answer the sort of questions that I remember putting to the Labour Party when I first became its campaign director nearly 25 years ago. The questions are these, and they haven't changed: who we are, this is what we stand for and this is what we are going to do for you, the British public."

Mr Miliband told the BBC: "The route map to strengthen the country and strengthen the Labour Party I think is clear. One is to keep very close to the concerns of voters. And that's why the decision this week about the 10p rate was right. Second is to make sure that people can see in what we do the convictions that hold us together as a party."

Mr Cameron will use a speech today to highlight the plight of the worst-off in British society. But yesterday he refused to say that the Tories would restore the 10p rate if elected.

Blair's massages from Carole Caplin ... and the other revelations

On Brown and Cameron

Lord Levy claims that Tony Blair warned that Gordon Brown would lose an election battle with the Tory leader, David Cameron. Lord Levy wrote: "Even with Iraq and all his growing political problems Tony still felt that if he stayed on he could lead Labour to a fourth victory. 'But Gordon? He can't defeat Cameron,' Tony told me.... He did believe that Cameron had major strengths; a sense of political timing, a winning personality and a natural ability to communicate and connect with people outside the closed world of politics, particularly in the crucial middle England constituencies, that Gordon would simply be unable to match."

On Brown's leadership

Interviewed by The Mail on Sunday, Lord Levy warns about about a lack of leadership in the party, declaring Gordon Brown to be "disappointing" and "indecisive". He said: "I really am saddened to see the polls at the moment, what's happening with the party, the bickering within the party and frankly what I and many others now perceive as a lack of strong leadership."

On Blair's 1997 victory

Tony Blair joined Lord Levy for tennis at his home the weekend after the 1997 general election. Lord Levy wrote: "He literally jumped up and down like a small kid who had been let out of school for the day and shouted, laughing out loud: 'I really did it. Can you believe it? I'm Prime Minister! I'm Prime Minister! I'm Prime Minister!' "

On cash for honours

Tony Blair believed Gordon Brown was behind party treasurer Jack Dromey's claim not to have known about Labour's controversial cash loans, according to Lord Levy's book. "I never assumed – Tony certainly never did – that it was about Jack Dromey. It was about Gordon Brown."

On Carole Caplin

Lord Levy said he warned Tony Blair about his "long massages" with his wife's lifestyle guru, Carole Caplin. He wrote: "The main worry was Tony, specifically gossip within No 10 concerning visits Carole was making to Chequers to give an increasingly stressed Prime Minister long massages .... I was deeply uncomfortable about raising the subject. But I told him that there was a real danger that Carole could become 'not just an issue for Cherie, but for you'. Tony went bright red. I never raised the issue again and nor, of course, did he. But he got the message."

On the 2006 attempted "coup" against Tony Blair

Lord Levy said that move by backbenchers against Mr Blair in 2006 demonstrated deteriorating relations between the then Prime Minister and Mr Brown. He wrote: "When I phoned Tony on a Middle East diplomatic mission immediately after the coup, his habitual tone of forbearance and forgiveness towards Gordon seemed finally to have gone. Brown, typically, had assured Blair that the plot had been nothing to do with him. But Tony, it was clear, simply no longer believed him." The peer added: "He kept saying he had never realised how duplicitous Gordon was – and what a 'liar'."

On Cherie Blair and Anji Hunter

Lord Levy records deep antipathy between Cherie Blair and her husband's aide and childhood friend, Anji Hunter, recounting that Mrs Blair reacted angrily after Ms Hunter threatened to quit over her job description. He quotes a note from Mrs Blair to Ms Hunter as saying: "If anything, your attempt to force a change in terms by threatening to leave has only hardened my hostility to you. I will not allow either myself or the PM to be held to ransom in this manner." It added: "In so far as your job brings you into contact with me, that will be kept to a minimum."