Analysis: Blair must keep Brown centre stage to keep initiative

This may prove a pivotal moment in the general election campaign. Now Gordon Brown is back, Tony Blair will want to keep him centre stage. Without him, Labour has struggled to make the economy an issue. The voters have pocketed the stability the Government has delivered since 1997 but is in no mood to thank Mr Blair.

This may prove a pivotal moment in the general election campaign. Now Gordon Brown is back, Tony Blair will want to keep him centre stage. Without him, Labour has struggled to make the economy an issue. The voters have pocketed the stability the Government has delivered since 1997 but is in no mood to thank Mr Blair.

Although Mr Brown has attended meetings of the election strategy group chaired by the Prime Minister, he has not had any day-to-day involvement in Labour's campaign, remaining on the sidelines because Alan Milburn was appointed to his old job as Labour's election supremo last autumn.

Mr Brown's backbench allies believe Labour's effort is faltering and say the Chancellor has been sorely missed, not least in rebutting the guerilla attacks by a resurgent Conservative Party.

Yesterday, Mr Brown certainly raised the morale of Labour MPs - especially those starting to fear for their jobs - with a thinly-spread but long list of sweeteners that were specifically designed to match the goodies offered by the Tories (pensioners) and Liberal Democrats (stamp duty).

They hope the Budget will allow Labour to regain the political initiative after being forced on to the back foot by the Tories. In the next few days, ministers will roll out detailed announcements.

A formal election role for Mr Brown is likely to be announced soon as well. There have been some tense negotiations over his precise remit. His supporters believe Mr Blair has allowed too many cooks - including Mr Milburn, his deputy David Miliband and Downing Street aides - to think they are in charge of the election campaign. So the Chancellor is demanding a clearer chain of decision-making as well as a clearly defined role.

Mr Blair and Mr Brown will unveil a poster together today and Labour strategists hope that a "strong team approach" will play better to the public than Mr Blair's presidential-style campaign to date.

The Budget is also a critical moment because it defines what the battle lines are between Labour and the Tories. Mr Brown contrasted the investment he promised with the "£35bn of cuts" proposed by the Tories by 2011-12. It is a message we will hear ad nauseam until polling day.

The Tories are happy to do battle on that ground. This week's NOP poll for The Independent suggests people are reaching their tolerance level on tax and prefer the Tories' broad approach. But Labour is confident that when the crunch comes, people will vote for investment in public services rather than tax cuts and Tory-style vouchers.

Mr Brown tried to combat the Tory promise of £4bn of tax cuts by describing a boost to his tax credit scheme as a tax cut for lower and middle income groups. He is convinced that is fairer than increasing tax thresholds. The Tories are expected to raise the 10p in the pound starting rate of income tax, which helps all taxpayers as well as the low paid, and to take some middle income earners out of the 40p top rate.

The Chancellor may be right about fairness but his more generous tax credits may not be as visible as the reductions the Tories will announce shortly.

Robert Reich, who was Labour Secretary in the Bill Clinton administration, warned that the trouble with tax credits is that you don't get the political credit.

It is no exaggeration to say the tax and spending debate could decide the general election. The battle may hinge not on whether the voters want tax cuts but whether the Tories can convince them they could both reduce taxes and preserve frontline services. I suspect many people will hold on to Labour's nurse for fear of something worse.