Tony Blair has been publicly warned by one of his own ministers that his government has become uncomfortably "detached" from its activist supporters, as he prepares for a stormy party conference this week.
Peter Hain, the minister for Europe, has appealed to his government colleagues to "pay more care and attention to party members" and warned that the relationship with trade unions must be repaired, "pretty damn quickly".
His comments come as party managers struggle to contain potential revolts at the Blackpool conference over Iraq, the use of private firms to run public services and the future of the NHS.
The bitter row threatens to derail negotiations with the big unions over Labour's chronic financial crisis.
Mr Hain, who often speaks as a kind of licensed rebel within the Government, told The Independent on Sunday, that party members had "justified complaints, justified grievances and have been alienated by gratuitous statements from members of the Government that should not have been made".
He deplored a reference to "wreckers" in a speech by Mr Blair to local councillors earlier this year, interpreted at the time as an attack on the public-sector unions. Mr Hain described it as a "phrase that should not have been used".
He warned: "Ministers are more detached from the party, and the party is more detached from ministers, than it is comfortable for us to be."
Mr Blair faces three particularly thorny issues at the conference, which opens tomorrow. The public sector unions are expected to use their combined voting strength tomorrow to force through a demand for a halt to all new contracts to allow private companies to manage public buildings or services.
While the vote will not affect government policy, it would be a slap in the face for Mr Blair on the opening day of the conference.
A difficult debate over Iraq is looming, with Glenys Kinnock, wife of the former party leader, joining the growing number of prominent Labour politicians who have called for there to be no military strike without prior United Nations sanction.
The debate on the health service, scheduled for Wednesday, will be overshadowed by a row over proposed "foundation hospitals", which reaches up to the Cabinet. The hospitals, which will have greater freedom than other NHS trusts to borrow money and run their own affairs, are a key element of proposed NHS reforms.
Earlier this week, the Chancellor, Gordon Brown, warned that the hospitals, proposed by Alan Milburn, Secretary of State for Health, cannot be allowed an uncontrolled right to borrow. He believes money raised by them should count as part of the main health budget, within a Treasury limit.
Mr Blair defended the new hospitals as a way of devolving responsibility within the NHS but admitted that there are "complicated issues" which remain unresolved.
Bill Morris, leader of the TGWU union, publishes a pamphlet today warning that the hospitals could run up "hidden" debts, creating a crisis similar to the one that ended in Railtrack going into receivership.
He will also attack them as a "dagger in the heart" of universal health care, which will lead to a "two-tier service".
The public disagreements between the Government and big unions have created a major problem for Labour officials trying to come to grips with the party's debts, which now exceed £10m.
John Edmonds, general secretary of the GMB union, said the matter could not be resolved while there were serious differences between unions and the Government.
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