Libs in a paddy as Labour steals poll thunder

THE champagne may have flowed in the small hours of Friday in Eastleigh but at that morning's press conference in London the Liberal Democrat celebrations came to an abrupt end. Paddy Ashdown's team had overturned a Conservative majority of nearly 18,000, winning by 9,339 votes; it had secured another MP and was destined to win its first Euro seats. Yet the question fielded by the boyish party spokesman, Matthew Taylor, was 'have the Liberal Democrats passed their peak?'

At the back of a cavernous hall there were recriminations as the spin doctors attacked the broadcasters' coverage of their by-election victory. By lunchtime even Labour activists were beginning to feel slightly sorry for the Liberal Democrats. As one put it: 'The lead item on The World At One was the Labour leadership and the second item was the Tory disaster. It's hardly banner headlines for Paddy Ashdown.'

It was bad luck that the impact of Mr Ashdown's Eastleigh triumph was dampened both by its predictability and by Labour's excellent performance in by-elections in four of its safe seats. But Labour also went one better; by coming second in Eastleigh it proved that it could not be squeezed out of the South.

Worse, the Liberal Democrats were still reeling from the eve-of-poll defection to Labour of Alec Kellaway, their candidate in Newham North-East. Mr Kellaway, who announced that it felt like 'coming home', was apparently spurred on by the likely election of Tony Blair, and his belief that Labour had been transformed into a social democratic party.

There is little doubt that if, as expected, Labour elects Mr Blair, its appeal among many potential Liberal Democrat voters will increase. As one Labour moderniser put it: 'The fact is that Labour has been given a completely new and up-to-date outlook by Neil Kinnock and John Smith. That is a fantastically potent threat to the Liberal Democrats because people who want to vote for a serious alternative government but felt unable to in the past are more likely to this time.'

David Marquand, professor of politics at Sheffield University and a former member of the SDP, conceded: 'The Kellaway question will cross many peoples' minds although, for me, the issue of constitutional reform (Labour is committed only to offering a referendum on electoral reform which might embraces proportional representation) is a crucial difference.'

Other former defectors from Labour are even less tempted. Tom McNally, adviser to Paddy Ashdown and a former Labour MP, said: 'In the words of the Scottish play 'I am in blood stepp'd in so far that . . . returning were as tedious as to go o'er'.' Ian Wright, a former vice-president of the SDP and Liberal Democrat constituency chairman, added: 'The question is: are you (like Mr Kellaway) prepared to appear at a press conference and sit next to Frank Dobson?'

But Mr Ashdown will almost certainly have to scale down his ambitions. Before the death of John Smith top Liberal Democrats were talking not of making huge gains in the South-west (because those, they felt, were in the bag), but in the South. Professor Marquand argues that there may now be a ceiling on Liberal Democrats' growth.

However, the Liberal Democrats' long, slow march is unlikely to go into reverse. The party has 4,550 councillors, and outright control of 40 councils. In large swaths of the country it remains the most likely alternative to the Tories. The advent of a social-democratic Labour leader will strike less of a chord with many anti-Tory voters in the South-west. There Mr Ashdown has tapped into a seam of support closer to Jeremy Thorpe's Liberals than David Owen and David Steel's Alliance.

Moreover, Mr Blair's electoral honeymoon may have come early. It is unlikely that, as leader and with the left to placate, he could keep Labour opinion poll ratings 33 points ahead of the Conservatives.

Even if Mr Blair sustains his popularity this is not all bad news for Mr Ashdown. During the 1992 general election the Liberal Democrats' fortunes were hampered by a highly effective Conservative campaign which argued that a vote for Mr Ashdown would let Mr Kinnock into Number 10. With Mr Blair the Labour leader, the 'Trojan horse' argument will not be so powerful.

The key, however, will lie in the strategy adopted by Mr Blair and his view of whether Labour can win a reasonable overall majority without the Liberal Democrats' help.

The political arithmetic has never pointed to a Lib-Lab pre- election pact because there is no guarantee that voters will respond as hoped if one party does not field a candidate. In last year's Newbury by-election, ICM asked voters before polling day how they intended to vote and produced a good prediction: Liberal Democrats on 64 per cent, Tories on 26. When asked how they would vote with a joint Lib Dem-Labour candidate the figures changed to 48 per cent to 45 per cent.

But, while Labour can hardly leave seats uncontested, it may be in its interests not to stop the Liberal Democrats winning some Tory seats.

It was Margaret Beckett who publicly claimed credit for Labour's decision to fight the Eastleigh by-election as energetically as possible. Mr Blair's line on the Liberal Democrats is more pragmatic. In an interview in yesterday's Guardian he rejected pacts but struck a rather different tone, arguing: 'If Labour is not electable, then doing a deal is not going to make it electable . . . there should be a dialogue of ideas . . . we should not be tribal about ideas and where they come from.'

Mr Blair, who is agnostic on proportional representation, has doubts about fierce attacks on the Liberal Democrats. He believes they make it more difficult to persuade wavering Liberal Democrat and Tory voters to abandon their parties by polarising the options.

In Mr Blair's interview he added that there were 'very great problems with the way that the Liberal Democrats operate locally', asserting that in some areas they were 'almost in the European social democratic mould' but in others like Tower Hamlets 'it is not clear that they have anything to do with the left-of-centre at all'. That opens up the prospects of a Labour Party which fights fiercely against the Liberal Democrats in some areas, but not so hard in others, and concentrates its national rhetoric on the Tories.

Such a strategy, without any hint of formal pacts, might be the best way to eject the Conservatives. In that desire, if nothing else, there is common ground between Mr Blair and Mr Ashdown. As one Liberal Democrat put it: 'Blair is of a school which wants power at almost any price - and Ashdown is even more desperate.'

(Photograph omitted)