How 'the election that never was' turned political allies into bitter rivals

Ed Balls tried to pin the blame for the 2007 "general election that never was" on to Ed Miliband, now his rival for the Labour leadership, according to a BBC Radio series starting next week.

Mr Balls allegedly ordered Damian McBride, Gordon Brown's spin doctor, to brief the media that the Brown allies Mr Miliband and Douglas Alexander were responsible for allowing intense speculation to build that Mr Brown would call an election in the autumn of 2007, a few months after succeeding Tony Blair as Prime Minister. In the end, he backed off, inflicting damage to his public image which allies believe he never repaired.

It is understood that the "blame game" for the non-election fiasco lies behind today's enmity between Mr Balls and Mr Miliband. The "two Eds" were once allies as long-standing members of the Brown inner circle, but there is now little love lost between them as they vie for the Labour leadership. Some supporters of Mr Balls will make David Miliband their second choice in the Labour election, even though he is seen as a Blairite rather than a Brownite.

The alleged briefing operation is revealed in The Brown Years, a three-part Radio 4 series made by Steve Richards, chief political commentator of The Independent, who has conducted extensive interviews with the Brown team and Cabinet ministers.

In his first interview since resigning as a key Brown aide in 2008 after 11 years, Spencer Livermore said the Prime Minister initially saw the election speculation as "an opportunity to bait the Conservatives". But the tactical gain came at a strategic cost.

Mr Livermore, who was Downing Street's director of political strategy, regrets not warning about the downside of scrapping the election when Team Brown got cold feet as polling in marginal seats suggested only a slim Labour majority. "I don't think it's possible. Does anyone?" the Prime Minister told his inner circle at the crucial meeting. The mood was "very, very sombre", according to Mr Livermore.

Ed Miliband told Mr Alexander, Labour's campaign co-ordinator: "I bet within 20 minutes we find we're going to get the blame for this."

Mr Livermore said: "Twenty minutes turned out to be slightly longer than it took... Damian [McBride] told me he had been instructed to blame certain individuals." Mr McBride told Mr Livermore that the order had come from Mr Balls.

Mr Livermore was shocked but not surprised, claiming that Mr McBride – who later resigned over emails discussing a smear campaign against senior Tories based on untrue stories – in effect worked for Mr Balls as well as for Mr Brown.

He believes that Ed Miliband and Mr Alexander protested to Mr Brown about the briefing against them, but he does not know whether the Prime Minister authorised it. "It was a style of politics that was unhelpful to him ultimately – but he never saw the damage it was doing," said Mr Livermore.

He pinpoints the briefing against Mr Miliband and Mr Alexander as the pivotal moment when the small team around Mr Brown since his days as Chancellor fractured. "It never, never went back to the way it was," he said. "And that was of huge cost to Gordon because he didn't have a small team unified in purpose, totally committed to him, that he so desperately needed at that point. When he was at his most vulnerable, people had retreated to their own departments or their own priorities, rather than rallying around."

Mr Alexander said Mr Brown did not blame him for allowing the election speculation to get out of control but added: "It's equally clear that within minutes of his decision leaking there was briefing actually naming myself and Ed Miliband... I was disappointed, but not altogether surprised... He would have been in a stronger position in Downing Street if there had been a firmer approach taken to some of the briefing that was endemic in those early months."

Mr Balls denied ordering the briefing, saying: "I have never ever asked Damian McBride to brief against any colleague, elected or unelected. So it's not true." He said the "fortysomethings" attracted by a 2007 election, including himself, Ed Miliband and Mr Alexander, had been proved right by events, rather than older "greybeards" who were more cautious.

Paul Sinclair, a former Downing Street aide, told the programme: "The No 10 communications operation was a shambles. I think a number of people had failed to make the mental leap from working for a chancellor who sought to be prime minister [to] actually working for a prime minister. There was still the mentality, which might work when you're going for the leadership, that if anybody seems to distinguish themselves or get profiled they are there to be cut down. There was not enough of an understanding that actually Gordon was captain of a team and therefore the team had to do well."

Mr Sinclair added: "There was a line in [the film] The Untouchables that Sean Connery's character uses – 'If they pull a knife, you pull a gun. They put one of yours in the hospital, you put one of theirs in the morgue'. I think some people thought that was a political communications training video."

When David Miliband wrote a critical newspaper article in 2008, Mr Brown was "very relaxed", according to Mr Sinclair. But other aides who had not discussed it with the Prime Minister attacked Mr Miliband, creating a "week-long leadership crisis."

Mr Sinclair said: "A number of his Cabinet colleagues I know had complained to him about Damian McBride... Gordon did not want to think ill of people who were loyal to him. He believed people could be redeemed and improved... I think he had tried to neutralise [the]more dangerous parts of Damian's behaviour."

Prime Minister Brown

Mr Livermore said: "One of the reasons he [Mr Brown] was less successful than he might otherwise have been is because he never ultimately set out his core purpose."

At the Treasury, Mr Brown left day-to-day policy decisions to his advisers and concentrated on longer-term, strategic decisions. "When we shifted into No 10, Gordon found himself taking an enormous amount of day-to-day decisions... One man was being asked to decide everything. It just was not an efficient way of doing things."

Mr Livermore said Mr Brown's staff were used to early starts, frequent emails and frequent phone calls. "He probably started work at 5 or 6 each morning and probably would wait until just about 7 o'clock before he would call anyone... He was clearly frequently concerned by what was on the Today programme, what was in the newspapers. He wanted to know what was going to happen and he would call the person he thought was responsible for dealing with that.

"He's an emotional and passionate person who gets angry like anyone does and I think far too much is made of [him] shouting at people.

"He's not an optimist by nature and he will always be the person who is looking forward and thinking, 'Well what's next? What could go wrong?'"

Brown's style

Steve Morris, a former Downing Street policy adviser, said: "He always seemed to be somewhere between rage and despair really... He never seemed to be happy... I'm not talking about wild temper tantrums, but just a sort of steady sullenness and grumpiness.

"I always felt people were slightly intimidated, to be honest. Gordon Brown's a very big guy. He has a slightly menacing demeanour at times. And he's a very big and slightly brooding presence."

Mr Sinclair, a former journalist, said Mr Brown could lose his temper but he did not see or know of any incident in which he bullied staff.

Coups against Brown

Alan Johnson, the former Home Secretary, told the programme Mr Brown might have been toppled after Labour lost the 2008 Glasgow East by-election if Parliament had been sitting rather than in recess. "I think it would have been very perilous."

Jack Straw, the former Justice secretary, said Labour was right to stick with Mr Brown. He argued that the "totally botched" backbench coup this January was one of the best things that had happened to him because it galvanised him. "I'm not certain that we would have done as well as we did at the general election had it not been for that."

A busman's holiday

Mr Brown's "family holiday" in Southwold in the summer of 2008 included meetings with key aides such as Baroness (Shriti) Vadera. She said: "He read [the US Federal Reserve chairman] Ben Bernanke's thesis about quantitative easing and he was reading a lot about the Japanese banking crisis. This was his summer holiday reading."

The Brown Years begins on BBC Radio 4 at 9am next Tuesday, 21 September. Steve Richards' book, Whatever It Takes: The Real Story of Gordon Brown and New Labour, was published yesterday by Fourth Estate

Ed Balls: Harvard scholar who made name at the Treasury

Born 25 February, 1967

Education Nottingham High School and Keble College, Oxford

Constituency Morley and Outwood

1989 Kennedy Scholar at Harvard

1990 Becomes a leader writer for the Financial Times

1994 Economic adviser to the Chancellor, Gordon Brown

1999 Chief economic adviser to the Treasury

2004 Joins political think tank the Smith Institute

2005 Elected MP for Normanton with a majority of 10,002. The constituency became Morley and Outwood in 2007

2006 Given first ministerial role as economic secretary to the Treasury

2007 Enters Cabinet as Secretary of State for Children, Schools and Families

2009 Hit by criticism from teachers for failing to scrap Sats for 11 year olds

May 2010 Announces he will stand for the Labour leadership

He says (on being characterised as demanding and divisive): "I have been trying to shrug off a totally unfair manipulated view of what I had done in the last few years."

They say "I've seen Ed Balls be a lot tougher in driving through change. I think the ability to control the machine of government is really crucial." – Ken Livingstone, former London mayor

Ed Miliband: Speechwriter who became Brown's climate champion

Born 24 December, 1969

Education Haverstock Comprehensive School and Corpus Christi College, Oxford

Constituency Doncaster North

1993 Appointed as a speechwriter to Harriet Harman

1994 Becomes speechwriter to shadow Chancellor, Gordon Brown

1997 Special adviser to Gordon Brown

2003 Sabbatical, lecturing at Centre for European Studies, Harvard

2004 Chairman of Treasury's Council of Economic Advisers

2005 Elected MP for Doncaster North with a majority of 12,656.

2006 Made Parliamentary Secretary to the Cabinet Office

2007 Enters Cabinet as Chancellor of the Duchy of Lancaster

2008 Appointed Secretary of State for Energy and Climate Change

2009 Hits out at "farcical" Copenhagen talks on climate change, which failed to reach a new agreement on reducing greenhouse gases

May 2010: Revealed he would battle his brother, David, for the Labour leadership

He says (on Labour's loss): "We found ourselves beached, unable to speak to too many of the concerns of the people of our country."

They say "Ed has the ability to inspire people, which is rare in politics." – Lord Kinnock, former Labour leader