Clarke tells Brown: 'Halt the slide or stand down'

Charles Clarke has issued a blunt warning that Labour will oust Gordon Brown as Prime Minister unless he shows that he can save the party from the electoral "disaster" it faces.

The former home secretary revived the debate about whether Mr Brown should lead Labour into the next general election by declaring that the party's backbenchers would not allow it to sleepwalk to defeat.

Writing in today's New Statesman magazine, Mr Clarke denied there was a "Blairite plot" to depose the Prime Minister. He said there was "a deep and widely shared concern – which does not derive from ideology – that Labour is destined to disaster if we go on as we are, combined with a determination that we will not permit that to happen".

Mr Clarke said last night that Labour had two ways to halt its slide – to improve its performance or for Mr Brown to stand down. He would not be drawn on which option it should choose.

His article will infuriate supporters of Mr Brown, as it will distract attention from the Prime Minister's attempt this week to mount a political fightback. Although many Labour MPs share Mr Clarke's concerns about the party's prospects, The Independent revealed last week that cabinet ministers will give him "one last chance" to revive its fortunes in the next two months. The former home secretary, a long-standing critic of Mr Brown, attacked Brownites for using the term "Blairite" as an insult – saying Brown allies used it to traduce the Foreign Secretary, David Miliband, in July when he put down a marker as a future Labour leadership contender. He accuses Brownites of "Just William"politics.

Reflecting Tony Blair's own concerns that Mr Brown has "dissed" his record, Mr Clarke said: "We should recognise that Tony Blair was an outstanding prime minister who has now departed the political scene and has no future part to play." He added: "It is inaccurate and misleading to dismiss as some kind of Blairite rump those who fear that Labour's current course will lead to utter destruction at the next general election."

Today, Mr Brown will paint a more optimistic picture of Britain's economic prospects than the Chancellor, Alistair Darling, who suggested at the weekend that it faced "arguably the worst" crisis for 60 years.

He will tell the Scottish CBI: "In the next 20 years the world economy will double in size and wealth and we have a great opportunity to win new business, new jobs and prosperity..."

The Prime Minister's relaunch has also been hampered by a row with the energy companies which has delayed plans to announce help for low-income families with soaring fuel bills.

Downing Street revived the prospect yesterday of imposing a windfall tax on energy firms unless they agreed to boost their help for this group. It admitted that "robust" discussions were being held with the companies. An announcement had been expected this week but is now likely to be delayed until next week.

Mr Brown's official spokesman said all options including a windfall tax were on the table but said ministers were seeking the co-operation of energy firms in helping people cope with bills.

Laura Schmidt, spokeswoman for the Association of Electricity Suppliers, said: "A windfall tax... would send a bad signal to companies contemplating about £100bn of investment in the energy industry in the UK."

More than 100 Labour MPs have backed a petition calling for a windfall tax drawn up by Compass, a left-wing pressure group.

However, ministers appear to be using the threat of a tax to put pressure on the energy companies as the talks reach a climax. John Hutton, the Business Secretary, and Mr Darling accept a windfall tax could jeopardise investment in the industry.