'Brown seized power without any idea what to do with it'

Tony Blair looked perplexed as he returned from a one-to-one meeting with Gordon Brown, his soon-to-be successor as prime minister, in June 2007. "There is nothing there," Mr Blair told his his closest aides. "He has no agenda for government. Nothing."

During Mr Brown's 10 years as Chancellor, his close allies had assured Labour MPs and Westminster journalists that things could only get better once their man took over. His acolytes had evicted Mr Blair from Downing Street a year earlier than he planned to leave by staging a "Blair must go" rebellion in 2006. Yet the absence of a "bottom drawer" full of Brownite policies remains one of the most surprising aspects of his premiership. "We were led to believe there would be a fireworks display. There wasn't a squib, not even a damp one," one cabinet minister recalled yesterday. "It was astonishing."

Mr Brown did put some light between him and his predecessor on issues such as 24-hour drinking, a supercasino and the classification of cannabis. His first Commons statement as Prime Minister promised a raft of constitutional reforms, although he lost interest before reviving them in a panic amid the MPs' expenses scandal.

When the books about the Blair-Brown era are written, June 2007 will be a pivotal moment and the absence of a distinctive Brownite agenda a mystery waiting to be solved.

Some evidence will be supplied this month in a book by Peter Watt, Labour's former general secretary, who claims he was scapegoated by Mr Brown and forced to resign during a row over £600,000 of proxy donations to the party by the property developer David Abrahams.

Mr Watt, who was highly respected in Labour circles, alleges that Mr Brown "stabbed him in the back" by publicly branding him a criminal. The Crown Prosecution Service decided last year not to bring any charges against him.

Yet Mr Watt's most damaging revelations are about Mr Brown's performance after he finally took over from the man he allowed to be the modernisers' candidate for the Labour leadership when John Smith died in 1994, even though he was the senior partner in their double-act.

"Gordon had been so desperate to become prime minister that we all assumed he knew what he was going to do when he got there," says Mr Watt. "Everyone around him thought there was some big plan sitting in a bottom drawer somewhere, just ready to be pulled out when the moment came. In fact, there was nothing.

"Downing Street was a shambles. There was no vision, no strategy, no co-ordination. It was completely dysfunctional. Gordon was simply making it up as he went along."

His book, serialised in The Mail on Sunday, says: "There were mutterings across Whitehall about what a mess No 10 was in. Decisions about the most trivial things would take weeks, because nobody felt confident enough to sign anything off themselves. At party HQ, we couldn't get answers to the simplest of questions – even getting the OK to send out an anodyne email to members was an agonising process. It had become clear that the machinery of No 10 was simply not up to the job."

The book, Inside Out: My Story of Betrayal and Cowardice at the Heart of New Labour, says: "Gordon is a big political figure, but he lacks the emotional intelligence required by a modern leader. If you cannot connect to people, you will fail. Gordon just doesn't have those skills.

"When Gordon became leader, nobody ever stopped to ask could he actually do the job. He soon defined himself as remote and a ditherer who was not up to the job. Like everyone else in the party, I had great hopes for Gordon. But it quickly became apparent he had no plans, and it descended into shambles."

Mr Watt provides more information for New Labour historians – and ammunition for Mr Brown's detractors – about the general election that never was in the autumn of 2007.

He reveals that planning was so advanced that the cash-strapped Labour Party, which he says was only hours away from bankruptcy in 2006, had already spent £1.2m by the time Mr Brown got cold feet and called off the autumn 2007 election. Personalised letters to 1.5 million voters in marginal constituencies were waiting to be sent out and had been delayed only by a postal strike.

As Mr Brown called off the election in a television interview, Mr Watt discloses, a fleet of limousines ordered by No 10 was circling Parliament Square, ready to whisk ministers off to the campaign trail. "They were sent away on a pretext, to spare us the humiliation of anyone spotting them lined up outside our offices when Gordon finally called the game off," he says.

Mr Watt claims that Douglas Alexander, Labour's election co-ordinator, berated his cabinet colleague Ed Miliband, who is in charge of the party's manifesto, for not preparing the document in case of a 2007 election. He says Mr Alexander complained: "You'd imagine that after 10 years of waiting, and 10 years complaining about Tony, we would have some idea of what we are going to do but we don't seem to have any policies."

Mr Brown scrapped his 2007 election plans after polling from marginal seats suggested he would get a smaller majority than Mr Blair had won two years earlier. He denied this was the reason, saying that he wanted time to set out his "vision" for the country. His critics claim that he has still not done so. However, there will be no excuses if Labour is not ready this year because an election must, by law, be held by 3 June. Although there have been wrangles over who will do what in the campaign, it is said that good progress is being made on the manifesto.

The historians' verdict on the Blair-Brown era is awaited. The most plausible explanation to date for Mr Brown being a man without a plan when he took over is that he thought that being "not Blair" would be enough.