Blair to sign off on May 5 election

Tony Blair

Prime Minister Tony Blair was due to hold a special cabinet meeting to sign off on an expected May 5 election date and a party manifesto putting British prosperity at the heart of his bid for a third term.

Blair will announce the polling date early next week before parliament is dissolved, formally launching a campaign which has in practice been under way for months, party sources say.

Polls show Blair - whose centre-left Labour Party won triple-digit parliamentary majorities in 1997 and 2001 - is on track for a third win, albeit with a slimmer majority.

The so-called "political cabinet", part of the pre-election choreography where top ministers meet in cabinet without the usual coterie of civil servants, is the clearest indication yet a formal election announcement is imminent.

Labour sees the economy as its main vote-winner.

But polls show his unpopular decision to join the US-led war in Iraq is likely to turn off many traditional supporters.

"We relish the prospect of a discussion and a debate and indeed a fight on the economy," Labour's election chief Alan Milburn told BBC Radio.

The party boasts that Britain, largely under its stewardship, has had the longest period of sustained economic growth in 200 years, plus low unemployment, inflation and interest rates.

But critics say big spending on schools and hospitals has yielded little improvement and led to over-borrowing.

Blair outlined his investment plans in an article in Thursday's Times newspaper, arguing public spending as a share of national income has risen under Labour.

"We need to continue making key investments ... it would be disastrous to cut off the investment just when it is producing results," wrote Blair.

Labour has vowed to continue spending on schools and hospitals which have suffered from decades of under-investment compared to European Union partners.

The opposition Conservatives are embroiled in an internal row over public spending after a senior member was axed by leader Michael Howard for suggesting the party was hiding the scale of its planned cuts.

They have struggled to close the gap on Labour despite a slicker campaign until the spending row.

A Communicate Research poll published on Sunday showed Labour, on 43 per cent, had widened its lead over the Conservatives to 12 points.

But some newspapers seized on figures released on Wednesday showing a fall in average household incomes as a blow to Labour's economic record.

Blair needs to avoid a backlash over his support for the US-led war in Iraq which hurt his personal trust ratings.

No longer the electoral asset he once was, Labour is trying to neutralise the Iraq factor by saying it shows Blair's resolve.

Milburn noted a "strong contrast between Prime Minister Tony Blair who stands up for things he believes in, who sees problems through ... and Howard who has a strategy of opportunism and who panics under pressure".

- REUTERS