One of Labour's most intellectually confident heavyweights would like to return to government. Charles Clarke on Blair, Europe and what Gordon Brown must do next.

''Blair thought if I'd been foreign secretary and home secretary I would be a credible opponent to Gordon for party leader''

Charles Clarke is not a natural back-bencher. In recent months he has taken to sitting to the side of Labour MPs during Prime Minister’s Questions, more an observer than a foot soldier, and out of the media spotlight since last autumn when Gordon Brown successfully managed a Labour revival Clarke had argued would not happen without a change of leader.

Now, as another cold snap runs through the party's self-confidence, Clarke, one of Labour's most intellectually confident heavyweights, is ready to speak out again, maintaining that the government's case must be "better articulated" between now and an election expected next year. Having battled for Labour's electability throughout the 1980s as Neil Kinnock's chief of staff, Clarke has never pulled his punches and, as it happens, he was the first senior politician to condemn the "British jobs for British workers" rhetoric which, tellingly, Brown first used in the Murdoch-owned News of the World in September 2006. It was "foolish", he says: "Foolish because, while we remain members of the European Union, we specifically exclude the possibility of prohibiting EU residents from working in this country . . . and it is therefore an unimplementable phrase."

The phrase has just boomeranged on Brown with protests and unofficial strikes at an oil refinery in Lincolnshire as we meet in Clarke's parliamentary office, snow falling on the Thames behind him. He goes out of his way, however, to make his most positive remarks yet about the Prime Minister, whom he once called "a control freak". "His great strength is in the economic field. I think he handled the situation extremely well in September and October; he was a figure of great authority at a time when the . . . economic world needed great authority. He was prepared to act and he deserves real credit for that . . . I think his position is strong."

As a former education secretary, he also argues that Brown has to broaden his agenda to include, for example, vocal support for public service reform: "We have to have a reform agenda focused absolutely on the users of those services." And yet, significantly, the man who believes it would have been better for new Labour had Brown stood against Tony Blair for the party leadership in 1994 - and lost - and who argued that Brown should not be crowned leader unopposed in 2007, now declares a leadership ceasefire until a likely general election in 2010. He indicates that other rebels will do the same.

"Gordon will lead us into the next election," he affirms. Does he think that is the right thing? "Yes, I do. I mean, we went through the process last year - Gordon made his own view clear, the party made it clear. You won't have from me, or other people, leadership issues being raised; that is where we are."

This unity is in stark contrast to the divisions of May 2006 when Blair sacked Clarke as home secretary, following the so-called "foreign prisoners" affair, in which it emerged that foreign nationals had been released from jail without being deported. Discussing this troubled period, Clarke reveals, astonishingly, that the day after his dismissal the prime minister told him, ruefully, that he had planned to make him foreign secretary so that he could be "a credible opponent to Gordon as the leader of the party".

Clarke confirms the rumour that before the events which led to his sacking, Blair had seen him as a foreign secretary in the making, and makes a startling claim. "It's very interesting. I knew nothing of this. Tony told me the day after he sacked me that he [had] wanted to make me foreign secretary, and I was staggered. He said it had long been his plan to make me foreign secretary; that is what he wanted to be the case. And he and Cherie then asked me and Carol [his wife] down to Chequers a week after, for a dinner, just the four of us, and we went right through it.

"He had a great plan, apparently, that he wanted me to be foreign secretary because he thought that if I had been foreign secretary and home secretary I would be a credible opponent to Gordon, as the leader of the party. And this had been his long-standing strategy, and that was what he had been intending to do, and that's what he hoped to do. Which ran against, of course, what I had said to him about feeling I needed to do home secretary for three or four years. I knew nothing about this until after the event, and I said to him if he was nice enough to think I ought to be leader of the party, then he might as well have been courteous enough to tell me this was his plan."

His recollection of the botched plan reaffirms not just the extent of the tension between Blair and Brown, but also Blair's ability to fumble his own reshuffles. Instead of appointing Clarke to the Foreign Office, he replaced the incumbent, Jack Straw, with the environment secretary, Margaret Beckett, who expressed her own surprise at the move by reportedly saying: "Fuck, I'm stunned." Beckett was replaced by David Miliband when Brown took office in June 2007.

Ironically, as he confirms, the one position he would have accepted - foreign secretary - was the one job Blair now felt unable to offer him. Although the prime minister offered him Defence "and other jobs" that he rather unconvincingly claims not to regret taking, Blair had thrown him to the wolves of the tabloid press.

"I think he was very weak," says Clarke, who had told Blair after the 2005 election that he would need several years in the job to unearth problems precisely of the sort that led to his sacking. "I thought he should have seen it through. In fact, he told me as late as the Wednesday before he sacked me that he was going to see it through . . . after Prime Minister's Questions, that Wednesday, in his office, and I think that's what he should have done.

"I think he was very preoccupied about the local elections that day . . . And there was a general pressure on Tony with the possible leadership challenge coming round the corner that was all being talked about."

Clarke believes he was used as a "scapegoat". "I think he felt he had to act and not allow the media to get at him, and I was a victim of that. It was serious weakness on Tony's part, and I regret it and for all I know he regrets it as well. But there we are - that's life. It remains one of the very few examples, I think, of there being no resignation letter: I did not write a letter to resign because I did not resign: I was sacked from that job, and I didn't wish to do that."

The intriguing revelation prompts the question, what if? Some say that Clarke would have been a more liberal foreign secretary. Pro-European as well as thoughtful about the Arab world, he might have revived some of the “ethical foreign policy” started, and sneered at, under Robin Cook, who had tragically died in 2005, a year before that reshuffle. Progressive intellectuals and constitutional reformers, Clarke and Cook had much in common.

Today, Clarke calls for talks with Iran and Syria and condemns George W Bush's use of "axis of evil", and has clearly been giving much thought to recent international history, about which he is keen to talk.

"From 1945 to 1989 you had a bipolar world - US and USSR - the Cold War, which framed the way everybody looked at the world, the way all politics evolved," he says.

"From 1989 to 11 September 2001, it was a more fluid situation, but it then became a situation with 9/11 in which really it was a unipolar world - America trying to run the world, with George Bush's 'axis of evil' and all the rest of it. I believe the congressional elections in 2006 were a statement from America that the unipolar world could no longer operate. And that was brought to its conclusion with the election of Barack Obama."

But if the United States no longer operates as world leader the question arises, says Clarke, of what kind of world it is. And this is where, he believes, Europe as well as India and China must come in.

Yet, though pro-European, he can still be critical. "I don't think Europe is yet strong enough. We've shown ourselves pretty ineffective, for example in the divisions on the recognition of Kosovo, or the situation in Gaza, or on Georgia where we have had divisions all over the place, and I say Europe has to get it together. I [also] think we have to say that the techniques and approaches that we followed in the past are not the ones of the future. So, I see no case for renewing Trident. I think it is absolutely a weapon of a past conflict - the Cold War, which ended in 1989 - and I believe that actually the strategic missile system, which I think was a Bush administration preoccupation, made it very difficult to establish strong relations with Russia."

Contrary to conventional wisdom that the next general election will be won or lost on the British economy, Clarke identifies two broader events that will be critical. "I think it will be won by the party which best demonstrates the importance and significance of the economic crisis, and Barack Obama's election, for the future. I believe that both of these events signal the end of 30 years of what I think of as Reagan-Thatcherism, to which Bill Clinton and Tony Blair were basically responding, rather than creating a new thought framework.

"I think the task for Labour, therefore - including Gordon Brown but for Labour right across the range - is to make clear that we have understood and we have got positive answers to it . . . that go right across the whole range.

"Social policy and constitutional reform and international policy are all part of that."

Is Keynesianism part of that “new thought framework”: has it been vindicated by the

financial crash and by Obama’s election on an open ticket of “spreading the wealth”? “I’ve always been a Keynesian, through my own education, studying economics at King’s College, Cambridge: you could not do anything other than be a Keynesian. And I believe that his understanding that the state had to act rather than not to act, to deal with the inefficiencies and incompetencies of markets – which was absolutely the main message of the 1930s – is absolutely that very same message today.”

A long-time supporter of British entry into the euro (like Cook), Clarke says there would have been many advantages to joining, and that, unlike the Conservatives, Labour should "keep an open mind" on it. As with his own sacking, he blames the failure to enter the euro on a chronic fear of the media, especially the Murdoch press. Yet, he says: "I am not up on my high horse saying, 'Go euro today,' but I am of the view that it would have probably been better if we had gone euro ten years ago."

The failure to do so was part of an incom­pletion of what Roy Jenkins called "breaking the mould" issues, including the constitution. Like Cook, Clarke wants a fully elected second chamber of parliament, "and we need to get there as fast as possible. This recent kerfuffle [of peers allegedly being asked to amend legislation for companies from which they received funds] just illustrates the reason for that."

He is not convinced of a "pure PR" system, in which "the tail wags the dog", and which weakens the constituency link he sees as crucial, but he would support the "Alternative Vote" system as recommended by Jenkins.

However, he falls short of calling for that other Blairite lost cause: a coalition with the Liberal Democrats, advocated by Sunder Katwala of the Fabians in last week's New Statesman.

"I saw Sunder's piece . . . [but] until they can stop being just against things, I think it's difficult. That said, I am always in favour of dialogue with them. I think talking is a great thing."

Although a perennial speech-giver and pamphlet-writer on almost every aspect of Labour policy, the former home secretary has been off the media radar in recent months. How is he, and - a key question - does he want to come back into government? "Personally, I feel great. I've had nearly three years out of government, and I've found that refreshing intellectually in some ways . . . I've enjoyed spending some more time on some of my constituency work, which is also good - it's exciting to do. I've enjoyed having less stress than you have when you're a government minister; there's no question, particularly in some of the roles I held, there is a lot of stress attached and I feel liberated from that. On the negative side, I have always enjoyed being in government. I felt I could make a difference in certain areas, I was proud of some of the things I did and I miss not being able to do that. What's difficult is to know how it would play [coming back into government]."

Here, Clarke demonstrates his liberal principles, and why it was always a misunderstanding to label him a "Blairite", by mentioning two policy areas where he openly disagrees with the Labour leadership.

"I mean, I've always wanted, for example, to be a transport minister, but I think this Heathrow decision [extension with a third runway] was completely wrong, and it is slightly difficult to know how it would work in these positions. Because, for example, what I've said about Trident and the strategic missile initiative - they are not the policy of the government, and working for a government for which these are the policies is not easy. So, I wouldn't enjoy that tension, but of course if I could find a role in government I would be absolutely delighted to do it; I would enjoy doing it. I suppose the second downside is that I don't think we are doing enough yet to prepare the story that we want to tell about the future at the next election.

"This remains very important, because my driving force above all is to win power at the next election for Labour. That's what has motivated me since 1980, working through with Neil Kinnock and all the rest of it. Obviously the polls are not good at the moment and I want to be able to do all I can to maximise our performance."

Despite the offer, the last time Clarke and Brown had a “significant conversation” was at Christmas 2007, with only a couple of brief exchanges in the “corridor” since then, the details of which he will not share. Nonetheless, he could not be more categoric about whether he himself would stand for the top job: “I don’t expect ever to run for the leadership of the Labour Party.”

There is a sense of frustration about Clarke, who remains as strongly opinionated as ever. He agrees that his own sacking demonstrated the self-destructive obedience of Blair and Brown to the right-wing press, particularly the Murdoch newspapers, wrongly perceived as the deciders of election results.

"The power of the media is overstated in certain circumstances, and that is why we could have stood out against it more, and I think we should have," he insists. "I think there are some aspects of the power of the media which are quite pernicious, in the way that they make certain trends of opinion move in British society, and I do think we could and should have been stronger about that . . .

"But," he concludes, "the case of me, where you started, is only a very small example of that."

Read the interview transcript of Macintyre talking to Clarke

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