Reid 'is backing Miliband to stand against Brown'

Gordon Brown's woes have deepened amid evidence of a backlash against the Chancellor among voters and renewed speculation he could face a cabinet-level challenge for the Labour leadership.

After more than a fortnight of torrid publicity, there are fresh question-marks over Mr Brown's route to Downing Street after Tony Blair steps down.

Two polls yesterday discovered his popularity had plummeted following controversies over his Budget and his 1997 tax raid on pension funds.

John Reid, the Home Secretary, was also reported to be urging David Miliband, the Environment Secretary, to mount a leadership challenge and even to be contemplating standing for the post himself.

The Chancellor remains the overwhelming favourite to succeed Mr Blair, who is expected to announce his resignation within days of local election results on 4 May. But his standing has been undermined by wide- spread criticism of his handling of the Budget, which failed to spell out that a new 20p income tax rate would be funded by the abolition of the 10p rate.

It was followed by accusations that Mr Brown overrode civil service objections to press ahead with a tax raid on pension funds in his first Budget 10 years ago.

A YouGov poll for The Sunday Times found that 52 per cent of voters now believe he has been a bad Chancellor, against 41 per cent who thought he had done a good job.

That is an almost an exact reversal of a month ago when 51 per cent said he had a good record, compared with 41 per cent who thought it was poor.

Asked whether he was fit to be prime minister in the light of the disclosures over pensions, only 27 per cent believed he was, against 57 per cent who said he was not. Just 11 per cent said they thought he would make a better Prime Minister than Tony Blair, while 38 per cent thought he would be worse.

An ICM Research poll for the News of the World found that 57 per cent hold him responsible for the current pension-fund shortfall. That rises to 69 per cent among voters aged 55 and older.

Overall, 44 per cent said Mr Brown's handling of the pensions issue would harm his chances of winning the next election, rising to 55 per cent among older voters.

His dip in opinion poll popularity will intensify concerns among some ministers and MPs over any "coronation". Attention remains focused on Mr Miliband, who has insisted he has no plans to stand.

A Labour source said: "There are people around him who are desperate for there to be a contested election." Mr Reid was reported yesterday to be prepared to support Mr Miliband if he stood against the Chancellor and believed he could win.

"There is no use saying 'wait till next time', because there may not be a next time. John is making it clear he does not want to stand himself. He will be 60 next month. But if nobody does, he will, as a last resort," a close friend of the Home Secretary told The Sunday Telegraph.

The only declared leadership candidates apart from Mr Brown are the left-wingers John McDonnell and Michael Meacher, who are both likely to struggle to win the support of the 45 MPs necessary to get their names on the ballot paper. Charles Clarke, the former home secretary, has refused to rule out standing. He has accused Mr Brown of being a "control freak" and "totally uncollegiate".