Murdoch blocked: Byers a moderniser determined to make his mark

STEPHEN BYERS set himself an ambitious target as Secretary of State for Trade and Industry - to be more Blairite than Tony Blair.

Describing himself as an "outrider" for Blairism, he grabbed headlines by pronouncing the latest New Labour mantra: "The reality now is that wealth creation is more important than wealth redistribution."

Mr Byers' speech to a City audience upset traditionalist Labour MPs. Some ministerial colleagues saw it as an attempt to escape the shadow of Peter Mandelson. Mr Byers succeeded him at the Department of Trade and Industry when he resigned last December after the disclosure of his pounds 373,000 loan from Geoffrey Robinson.

Although Mr Mandelson loved the DTI, the one decision he would have not minded avoiding was the hot potato that landed in his lap when BSkyB launched its bid for Manchester United.

Indeed, Mr Byers faced the most difficult decision of his political life when he left for his Easter break armed with the Monopolies and Mergers Commission report on the takeover. But it was much easier than he had expected: the strong recommendation against the deal left him with little option. "It was very clear cut; he didn't have any choice but to go along with it," said one colleague last night.

Nonetheless, Mr Byers' decision to block the merger may increase his standing among Labour MPs, many of whom were hostile to the takeover.

Mr Byers, who will be 46 next week, is seen as a possible future Labour leader. He and Alan Milburn, who succeeded him as Chief Treasury Secretary when he moved to the DTI, are regarded by some as the "Blair and Brown" of the MPs who entered Parliament in 1992. They shared a Commons office, like Mr Blair and Mr Brown eight years earlier, and are friends who may become leadership rivals.

Mr Byers, who won promotion to the Cabinet five months before Mr Milburn, is perceived as being just ahead of his ally in the future leadership stakes. "He has the intellect and the steel; he is the more substantial figure," said one Blair ally.

He became MP for Wallsend in 1992, and made his mark as a leading moderniser before the 1997 election, when he told journalists over dinner in a Blackpool restaurant that Labour should break its historic links with the trade unions. His words found their way on to the front pages and a huge row broke out in the middle of the conference of the Trades Union Congress.

But Mr Byers refused to back down - for fear of sending voters a signal Labour would be "soft" on the unions - and Mr Blair was said to be impressed by his coolness under fire.

He is a pro-European and a supporter of Britain joining the single currency. He is still in the process of winning his spurs with British businessmen, many of whom were sad to see Mr Mandelson depart the stage, partly because of his close links to Mr Blair. But allies of Mr Byers are in no doubt he is up to the task, and that he will soon stamp his own authority on the DTI.