Sunny Jim's big mistake

The ghost of James Callaghan, the last Labour prime minister to take over midterm, haunts Gordon Bro

On Thursday 7 September 1978, James Callaghan decided to address the nation in a formal prime ministerial broadcast about the forthcoming election. Everyone in the country expected him to announce that he was about to dissolve parliament and invite the British people to re-elect him as prime minister. During lunchtime drinks for reporters preparing to follow her forthcoming campaign, the Tory leader, Margaret Thatcher, said: "I don't imagine he's making a ministerial broadcast just to say he isn't holding a general election."

But that is precisely what he did.

The Labour Party had been at battle stations for over a year, and many in the party had been preparing for an October election. Harry Conroy, the veteran Scottish political correspondent, describes the moment of the broadcast in his portrait of Callaghan for a recent collection of short biographies of 20th-century prime ministers. Working at the time as a press officer for the party in Scotland, Conroy sat down to watch the broadcast with the then Scottish Labour Party general secretary, Helen Liddell. When Callaghan announced that there would be no election that year, Liddell's reaction was one of "stunned silence". Conroy himself had taken leave from the Daily Record to help organise the campaign, which had started behind the scenes in July 1977. "It was all systems go!" writes Conroy. "Then came the 7 September broadcast, which left us all stunned."

The election wouldn't come for another eight months. Callaghan's delay contributed hugely to the catastrophic defeat in May 1979, which ushered in a period of Tory domination that lasted for the best part of two decades.

The ghost of Callaghan hovers over Gordon Brown and those around him. But it is not just the Prime Minister and his advisers who fret about "the Callaghan thing"; MPs talk about it obsessively and pray Brown will not suffer a similar fate. There are the crudest political parallels. When Callaghan took over from Harold Wilson in 1976, he was, just like Brown in 2007, the most senior figure in the government and the obvious man for the job. In Thatcher, he faced an untried opponent, in some ways akin to David Cameron. And the country had grown tired of Labour in power as it had under Tony Blair.

In reality, the comparison is ludicrous. Callaghan entered Downing Street in April 1976, at the height of an economic crisis. Inflation was running at 14 per cent and would soon rise higher still, while the International Monetary Fund was demanding a multibillion-pound cut in public sector borrowing. Within a year, Callaghan had been forced into an alliance with the Liberals to maintain the government's control of the House of Commons. At the same time, the new prime minister had to deal with a Labour Party in a state of civil war. The new Labour project may be unpopular in some Labour circles, but I can confidently predict that when the Chancellor, Alistair Darling, stands up at this year's party conference, he will not be booed to and from the stage as was Denis Healey in 1976.

The Brown honeymoon period has been more pronounced and the electoral bounce higher than anyone expected. The Prime Minister's inner circle is described as "pleased but not letting it go to their heads, in a suitably Brownite way". To his immense credit, the new Prime Minister has out-thought everyone. No one guessed he would square the central contradiction of his administration - that it marks continuity and change at the same time - with quite such ease.

As a result of his early success, speculation is swirling through Westminster like an unseasonal summer storm. Will Brown call a snap autumn election or will he wait till spring? Or will he just hang on as long as he can? Part of this is a function of the new style of dealing with the press. With briefings now at a minimum, political journalists have to spend their time speculating about what they genuinely don't know, rather than pretending to speculate about what they have already been told in advance. But there is no doubt that the election campaign is beginning. Already MPs in the Parliamentary Labour Party have received emails headed "Building Towards a General Election". The Development Secretary, Douglas Alexander, who is in charge of the elections strategy, will be holding two seminars on "effective campaigning" before the summer recess. Meanwhile, the old warhorse David Blunkett has been drafted in to co-ordinate ideas on the voluntary sector, as part of plans to draw up the next Labour manifesto.

Once more, the ghost of Jim Callaghan is being invoked. Some feel that Brown should be decisive while the polls are in his favour, and bury for ever the memory of the last Labour prime minister to take over while the party was in office. An announcement at this year's party conference, for instance, would knock the wind out of Cameron's sails and allow for an election before the end of the year. Or so the theory goes. But the Tories have prepared for just such a contingency and have consistently called for a snap election as a way of challenging Brown's legitimacy. They also have the money to fight an election, while the Labour Party does not. Although there is a never-say-never attitude to the idea of a late-autumn poll among those around the Prime Minister, I am told it is "most unlikely".

In response to Conservative claims that Brown lacks a genuine electoral mandate, Brown's people simply point to two other figures from history: Harold Macmillan and John Major. Both Tory prime ministers took over midterm and waited for at least a year before calling an election.

And yet there is a difference. Neither Macmillan nor Major promised to transform the constitutional framework in which Brit ish politics operates, as Brown has done. It is simply not sustainable to continue promising a new era of accountability in government and curbs on the power of the executive, while remaining in power as a prime minister who has not been elected by the British people. Brown does not have to call an election this year, but if he leaves it later than 2008, he will lose much of the well-earned credibility he has gained and the comparisons with Callaghan would begin again - but this time with some justification.