MPs return to Westminster today and head straight into what could prove to be one of the defining battles of this Parliament. The first Commons debate will be on the Coalition Government's bill to stage a referendum on the Alternative Vote next May.

Despite backing AV in its manifesto at the last election, Labour plans to vote against the bill, arguing that the Government is trying to sneak through plans to gerrymander constituencies in favour of the Conservative Party at the same time. In an interview with this newspaper today, the favourite for the Labour leadership, David Miliband, accuses the Coalition of engaging in "student politics" by packaging the bill for a referendum on AV with a move to reduce the number of MPs (from 650 to 600) and to equalise the size of constituencies.

The bill, as it stands, is certainly not perfect. But Mr Miliband is wrong to identify the inclusion of constituency reform as a great point of principle. It is indeed likely that the Conservatives would benefit from the equalisation of the size of constituencies. But the argument that this is gerrymandering is hyperbolic; especially since the present system benefits the Labour Party (whose MPs disproportionately come from smaller seats).

And the shortcomings of the bill – such as the use of lists of registered voters rather than the adult population to draw up new seats and the senseless requirement that no constituency can be more than 5 per cent greater or smaller than the national average – can all be fixed through constructive amendments. There is no good reason to reject the entire bill.

Labour no doubt calculates that it will be putting maximum pressure on the Government by adopting a stance of maximum opposition. If the Liberal Democrats do not get their referendum on voting reform (their key demand in post-election negotiations) the Coalition will come under huge strain as the third party's MPs and activists ask what the point is of their partnership with the Conservatives.

But Labour is neglecting the bigger picture. The Party will look monumentally cynical if it votes to head off a referendum that it was campaigning for as recently as May. It will be joining forces with the reactionary right of the Tory Party, which also wants to defeat the bill, although for different reasons. And if Labour helps to scupper this bill, it will jeopardise its chance of forming a coalition with the Liberal Democrats at the next election. Worst of all, Labour will be, implicitly, allying itself with a discredited electoral system.

The Labour Party has commissioned its own research on the effect of the bill which suggests the Liberal Democrats would suffer more than any other party in the redrawing of constituency boundaries. This has prompted Jack Straw, who is leading the Labour charge against the bill, to argue that the Liberal Democrats are like "turkeys voting for Christmas". But what the Liberal Democrats understand – and Mr Straw plainly does not – is that this is a once in a generation chance to begin the reform of our flawed voting system.

The Liberal Democrat leader, Nick Clegg, argued at the last election that AV was "a miserable little compromise". And so it is, when compared to a truly proportional electoral system. But it is a beginning.

Nick Clegg and the Liberal Democrats are justified in their analysis that this bill is the best means available for advancing electoral reform. They are right not to make the best the enemy of the good. Meanwhile, Labour is confusing tactics with strategy and, if the party continues down this path of short-sighted opposition, it risks finding itself on the wrong side of progressive history.