Darling becomes most senior minister to criticise Brown saying Labour must 'sharpen up'

In a frank confession that shocked Labour MPs, the Chancellor said the party lacked a clear message and had failed to connect with voters.

Mr Darling is by far the most senior Cabinet minister to call publicly for a change of tactics in the face of collapsing opinion poll ratings.

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Labour insiders fear the party is heading for meltdown in local elections on May 1.

Speaking on a visit to China, Mr Darling said: "We have got to make sure that ... we sharpen ourselves up, that we have a clear message of what we are about."

His suggestion that Gordon Brown has failed to articulate a clear vision to voters will be seen as deeply unhelpful at Downing Street.

The Chancellor rejected suggestions that senior ministers, including Schools Secretary Ed Balls, are jockeying for position in a Labour leadership contest in case the Prime Minister is forced out.

"I don't tend to believe these things," Mr Darling said. "I see no evidence of it."

He insisted that Labour had simply to demonstrate that it had not forgotten why it was elected. "All governments and parties go through difficult patches," he added.

"This is a time when we should remember why we stand for government, the purpose of being in government."

George Osborne, the Tory shadow chancellor, said: "This is an unprecedented attack on the Prime Minister by his most senior Cabinet colleague, the Chancellor of the Exchequer.

"Even Gordon Brown never criticised Tony Blair in public. What started as anonymous briefings from backbenchers has now burst into the open with a public attack on Gordon Brown from the second most important person in the Government.

"If the Government is fighting itself, how can it fight for Britain?" Vince Cable, the LibDem Treasury spokesman, said: "Many people will be staggered to hear that only now, six months into a financial crisis, the Chancellor is starting to admit there is a problem. Where on earth has the Chancellor been?

"Yet even after the Northern Rock disaster and bungled tax reforms, with mounting personal debt and a falling housing market, the only thing the Chancellor feels is wrong is the need for improved communications.

"This isn't an economic strategy, this is a sketch from Yes Minister."

Local government experts predict that Labour could be forced into third place behind in next month's local elections. That would represent the party's worst showing in 30 years.

Labour losses are expected to include Sheffield council, which could fall to the Liberal Democrats, and Bury, which the Tories are tipped to take.

Party strategists are braced for a score of just 28 or 29 per cent of the vote.

Senior Labour MPs said yesterday that if the party does even worse than in 2004, when it polled just 26 per cent, the Prime Minister could expect a "summer of discontent".

There are also signs that the revolt against Mr Brown's decision to scrap the 10p starting rate of tax is growing.

Rebel MPs were alarmed that the Prime Minister refused to concede in a round of TV interviews this week that there would be any losers from the change. Economic forecasters say 5.3million families will be worse off.

Some senior ministers say privately that they expect Mr Brown to make concessions to avoid a disastrous Parliamentary defeat on the issue.

David Blunkett, one of the senior Labour figures pressing for a rethink, argues that the Government should either offer a rebate to the losers or promise to reopen the debate in the autumn.

Ken Purchase, a senior Labour MP, said yesterday that Mr Brown was in an "awful hole" and had been let down by Cabinet colleagues.

In an interview with the ePolitix.com website, Mr Purchase said: "Gordon Brown could be a very, very great prime minister but he has got an awful hole to get out of now.

"It has been brought about largely by events over which he has had little control but what I am anxious about is that he doesn't try to do a Blair and aggravate the party."

The MP said the "election that never was" in the autumn had been very damaging.