Labour will “wither away” if it “turns inwards” following its crushing election defeat, a senior member of the shadow cabinet will warn.
Tristram Hunt, the shadow Education Secretary, will say that Labour suffers from a “credibility gap” as it faces three huge challenges: the rise of nationalism in Scotland, a lack of trust in its traditional heartlands and a loss of confidence in Middle England.
Mr Hunt, a moderniser, is considering whether to run for the Labour leadership and is expected to make his intentions clear in a speech to the Demos think-tank.
Some natural allies doubt he will muster the required nominations by 35 MPs and hope he will rally behind Liz Kendall, who is seen as the New Labour standard-bearer.
The other candidates are Andy Burnham and Yvette Cooper, who already have enough nominations to stand, and Mary Creagh.
Tensions over the party’s direction rose as Lord Mandelson, the Blairite former cabinet minister, accused Ed Miliband of fighting a “class war” election.
Writing in the New York Times, Lord Mandelson said: “The ‘haves’ in society are prepared to make sacrifices for the ‘have-nots’, but they need to be treated to a reasoned argument, not a ‘them and us’ assault that undermines rather than builds consensus… They won’t sign up for what looks like an ideological vendetta, particularly if they fear becoming undeserving financial casualties of it.”
Lord Mandelson urged the leadership candidates to be bolder because the party was heading downwards.
“The leadership contenders all fault Labour’s strategy under Mr Miliband. They rightly talk about reconnecting with voters, but when they also talk about the need for party unity this sounds like continuity and an unwillingness to make hard policy choices. This is a luxury that is not open to them – not if they want to win,” he said.
Who will be the next Labour leader?
Who will be the next Labour leader?
1/7 Andy Burnham
Andy Burnham has promised to restore the party's "emotional connection with millions of people," if elected
2/7 Mary Creagh
Mary Creagh has called on her party to win back “Middle England”
3/7 Liz Kendall
Shadow health minister Liz Kendall is seen as a Blairite
4/7 Yvette Cooper
Shadow home secretary Yvette Cooper became the fourth person to join the Labour leadership race
5/7 Tristram Hunt
Tristram Hunt, the shadow Education Secretary, has said he will not run for the Labour leadership as he had not gathered the required nominations of 35 MPs. He has instead endorsed the moderniser Liz Kendall.
6/7 Dan Jarvis
One of the favourites to succeed Ed Miliband as Labour leader – ex-Army paratrooper Dan Jarvis – has ruled himself out, saying he won't do it because of his children
7/7 Chuka Umunna
Chuka Umunna dropped out of the Labour leadership contest just three days after he announced he was in the running
Mr Hunt, an ally of Lord Mandelson, will argue for Labour to make “hard choices” such as freezing or cutting child benefit for school-age children to finance an expansion of childcare from the age of two.
He will propose higher state benefits for claimants with a strong record of work and extending “devo max” from Scotland to English cities and regions, which should be allowed to cut business rates to attract job-creating investment.
The shadow education secretary will describe Mr Miliband’s strategy as “timid” as he tried to unite the party, and call for his “35 per cent” core vote strategy to be replaced by a “100 per cent strategy”.
Mr Hunt will say: “Of course we need to stop haemorrhaging support in our traditional heartlands. But we must ensure that same heart sends our message – pumps the blood – to parts of our country we no longer reach.
“We need to win in Scotland. We need to win against Ukip. And we need to win whole swathes of Southern England where, early New Labour aside, we have long since lost any pretence at an emotional connection. If we turn further inwards now, we could wither away.”
Ms Kendall has criticised suggestions by some trade unions that they might deprive Labour of funding if they did not secure the new leader they wanted.
She said the election should not be “dominated by threats to withdraw funding or back other parties.” But she also promised to repeal planned legislation by the Conservative government to tighten ballot rules to make strikes more difficult to call.
She added: “This is the time for hard truths – and that’s the kind of campaign, and party, that I will lead.”