The Week in Politics: The reshuffle has put PM's legacy on the line

During a momentous week, one senior minister described the power struggle at the heart of the Government as being between one man worried about his "legacy" and another fretting about his "inheritance". It neatly encapsulated the battle between Tony Blair and Gordon Brown.

During a momentous week, one senior minister described the power struggle at the heart of the Government as being between one man worried about his "legacy" and another fretting about his "inheritance". It neatly encapsulated the battle between Tony Blair and Gordon Brown.

Like all prime ministers, Mr Blair is anxious about what the history books will make of his time in Downing Street. If his legacy is poor, he will have squandered two - possibly three - huge majorities that his party could not have dreamt of during its long wilderness years. He wants to be remembered as more than a grinning face who spun his way to an election hat-trick and took Britain to war on a false prospectus.

When he was agonising this spring about whether to quit before the general election, Mr Blair had to judge whether he could ensure a better legacy by staying on. Could things only get better, or was this as good as it was going to get?

Allies say his main concern was whether he would hinder rather than help Labour's election prospects by staying on. After an improvement in his fortunes in June, the Mr Blair decided he would lead his party into a third election.

Mr Brown expected a different outcome, having got the impression last November - at a "peace" dinner hosted by John Prescott - that Mr Blair was preparing to bow out before the election.

The view in the Brown camp is that the Prime Minister was entitled to change his mind, but that Mr Brown will not fall for the same trick again; the carrot of the succession was dangled at the Granita restaurant in 1994 and again last November. Mr Brown will not trust Mr Blair next time he talks about quitting. He will believe it when it happens.

But Mr Brown is still bound to think about it. His supporters are worried by the events of the past week, and not only because the surprisingly early return of the Blairite Alan Milburn to the Cabinet has edged Mr Brown out of the pivotal role he played at the 1997 and 2001 general elections.

Their fear is that Mr Blair's determination to fight on a bold, radical manifesto may ruin the inheritance he may eventually pass to the Chancellor who, although Mr Milburn is now his most likely challenger, remains the most likely to succeed Mr Blair.

Although they do not admit it in public, the founding partners of the New Labour project have diverged. Mr Blair feels Mr Brown has jeopardised his legacy by thwarting his desire to take Britain into the single currency and transform public services. Mr Brown is fighting to preserve his inheritance. The euro is not yet right on economic grounds, and another raft of half-baked reforms - notably on "choice" - will push Labour on to the Tories' home ground, he believes.

The Prime Minister hopes this will drive Michael Howard further to the right as he seeks to create some space. The Chancellor fears Mr Blair risks undermining the Labour's goal of creating a more progressive society. That is what he meant when he told the Labour conference a year ago that the party was best when it was "Labour", a riposte to Mr Blair's statement a year earlier that the party was "at our best when at our boldest".

The clash is not a bare-knuckle fight between two men desperate to be Prime Minister, as is often portrayed. Mr Blair might have stood down this year if things had not got better. Mr Brown, too, is more complex than his caricature. I believe those of his friends who tell me his primary goal is not to be PM but to deliver the progressive project. But, like Mr Blair, he feels blocked by the other man.

So there is an impasse at the top. Mr Blair has turned to Mr Milburn to try to break it. The Prime Minister does not want what aides describe as the "safety first" manifesto of 2001, which left a vacuum after the election. Mr Blair has two draft Queen's Speeches up his sleeve, one for this November and a post-election one for next spring, to prevent what ministers call the embarrassing "legislative stagnation" after the 2001 election.

But there are still lots of blank pages in the manifesto. Mr Milburn's challenge is to fill them. His aim, say allies, is to find new policies that appeal to Labour's core vote and the wider electorate.

This could prove a poisoned chalice for the former health secretary. Labour MPs believe his decision to leave the Cabinet last year, although driven by his stated family reasons, was good politics. Three years out of the cabinet would have detached him from the dog days of the Blair regime. At 46, seven years younger than Mr Brown, he is in no hurry for a leadership contest.

Friends admit his return is a gamble. If his policy ideas bomb, the election goes badly or his presence provokes infighting, his own ambitions will take a big knock and he may have a lot more time to spend with his family.

Perhaps Mr Milburn's biggest challenge will be to try to ensure the Prime Minister and Chancellor converge, and to protect Mr Blair's legacy and his inheritance to his party. Mr Milburn is a big beast, but he has now got a big job.