Tony Blair faces a fresh rebellion by Labour MPs who will set up a new organisation today to press for a change of direction by his Government.
The founding of the New Wave group poses a serious challenge to the Prime Minister because the 15 MPs who are launching it are regarded as mainstream Labour figures rather than the left-wing rebels called "the usual suspects".
New Wave's demands include an end to "neo-colonial adventures" after the Iraq invasion, curbs on the Government's plans to impose market forces on public services and closer links between Labour and the trade unions.
The move reflects growing disenchantment within the Parliamentary Labour Party (PLP) and a belief among Labour MPs that the New Labour project has run out of steam.
The Prime Minister will seek to win over his critics by promoting the Queen's Speech on Wednesday as being in tune with "real Labour" values and launching a consultation exercise on Friday that will shape Labour's general election manifesto.
New Wave will draw up a shopping list for the Labour manifesto through seminars, pamphlets and a website (www.newwavelabour.co.uk).
Announcing the birth of New Wave in a letter in The Independent today, its founders say: "We now have a realistic chance of a historic third term but we must develop a fresh approach to both policy and organisation if we are to move Britain decisively in a democratic socialist direction. We must also guard against the increasing signs of disillusionment and apathy amongst our own supporters and produce a radical and exciting programme which can inspire both confidence and hope."
The MPs, who include Jon Cruddas, a former Downing Street aide, describe themselves as "moderate left". They say Labour needs to move beyond Mr Blair's Third Way by finding ways to "transform our society rather than accommodate to the Thatcherite legacy".
Angela Eagle, a former minister and one of the organisers, said the group aimed to encourage "constructive debate" among the PLP, the party and the public and to ensure that Labour's policy making was not contracted to outside think-tanks. She stressed that New Wave would not call for Mr Blair to stand down and was not a "front" or "cheerleader" for Gordon Brown or any other potential Labour leader.
"This is not about reverse gears, it is about consolidating our values," she said.
Blair aides admit privately that the Prime Minister needs to build bridges with the PLP. Many Labour MPs feel frozen out of policy decisions and last week the Government's 161 majority was cut to 17 in a vote on foundation hospitals.
Letters, page 15Reuse content