How Blair's `secret burden' is bringing Labour to a halt

Ministers will get their annual school reports next week and they are quaking in their pre-reshuffle shoes. The headmaster, Tony Blair, has decreed that the analysis of each department's work should be "more objective" than last year's sycophantic nonsense. Instead of Downing Street apparatchiks scribbling a series of glowing appraisals, doctors and nurses have been asked to give their verdict on Frank Dobson's performance. Teachers have even been issued with government cameras so that they can capture David Blunkett's failings on film. The report will no doubt find plenty of space to list the Government's fantastic achievements, but it will also identify areas in which ministerial pupils could do better.

The Prime Minister is realising that it is harder than he expected to make policies hatched in the cocoon of opposition affect actual schools, hospitals and roads. There is a time lag between idea and reality which ministers fear could extend even beyond the next election. This is supposed to be the "year of delivery" - that new Labour mantra - but success is taking longer than the Government would like. And Downing Street is being warned by its focus groups that this delay is taking the gloss off the Government's reputation.

The problem, according to the strategists, is that expectations were so high when Tony Blair swept to power in 1997 (fuelled by talk of a "young, dynamic new Britain") that the public expected instant reform. "The sense of euphoria was so strong that people thought everything would change immediately," one adviser said last week. "People are thinking: `I want my life to be better' and that hasn't happened."

Publicly, Downing Street is still busy hyping its achievements but privately the strategists are reassessing why everything is taking so much time. One theory is that the Government concentrated too much on its programme of constitutional reform in the first year, so it had no time left to push through policies which would change ordinary people's lives. Blairite MPs moan privately that devolution should never have been a priority for the incoming government because it was the "unfinished business" of the previous Labour leader, John Smith, rather than a personal passion of Tony Blair. They describe this legacy as the Prime Minister's "secret burden" which is dragging down the Government in other areas - the commitment to giving people the "right to roam" is another Smith policy which has caused controversy. Blair himself was always agnostic about the establishment of a Scottish Parliament and a Welsh Assembly ("he would have dumped the commitment if it had been politically possible," one ally said) but he could not abandon devolution because the principle had become so sacrosanct.

Lords reform, another drain on Parliamentary time, could also have been handled better. Instead of doing deals with the hereditary peers and agonising about the make-up of the new Upper Chamber, the Government should have set up a Royal Commission to draw up recommendations. Ministers could then have brought forward proposals to reform the Upper Chamber in one go - which would have been much more difficult for the hereditary peers to oppose.

These constitutional changes have one advantage, however, which is that they have immediate visible results. The same cannot be said of health, education or transport policies which will take years to have a genuine impact. John Prescott is now being blamed by the Downing Street whisperers for failing to improve Britain's roads. But Cabinet ministers responsible for spending departments point out that their hands were tied when Labour came to power because Gordon Brown announced that the Government would stick to Conservative spending limits for two years. The new administration was all too conscious that previous Labour governments had been brought down by economic incompetence - two years in, Wilson or Callaghan were not just suffering problems of slow delivery. The Chancellor's caution meant, however, that the implementation of many policies had to be delayed. The much-hyped pounds 40 billion allocated for health and education by the Treasury, for example, was released only three months ago, and it will take months more for this to filter down to real schools and hospitals. "It took two years for us to be able to even start the process of making a difference," one member of the Cabinet said. "And it will take much longer for anyone to notice anything's changed."

There is frustration among ministers about just how slow the process of government is. They have to consult their civil servants, write a Green Paper, put together a White Paper then set up pilot projects before anything actually happens. The whole thing takes years. The Prime Minister has done a lot to try to speed up the government machine and he is determined to do more. The social exclusion unit, based in the Cabinet Office with representatives from around Whitehall, is seen as a model for the future - it conducts its own research, draws up recommendations and issues a report - all, if necessary, within weeks.

Downing Street wants to replicate this system by beefing up the Cabinet Office as a co-ordinating department, headed by a powerful minister known to be close to Blair - his old friend Lord Falconer has been mentioned for this role. It is likely that this de facto Prime Minister's department will be created in the next reshuffle. This is all part of the creation of President Blair. According to the Whitehall watcher Professor Peter Hennessy, there are only two words that matter in government: "Tony wants". He says the Prime Minister's influence over policy is far greater than in any previous administration, Labour or Conservative.

In some cases this can dramatically speed up the process of delivery - Downing Street can rush an idea through the departmental system. But often the centralisation of power is acting as a brake on achieving the results which the Government wants. This has been exacerbated in the past five months because Blair's attention has been focused on the Kosovo conflict and the crisis in Northern Ireland rather than the domestic agenda.

But, even before then ministers had been getting increasingly frustrated by Downing Street's "meddling". They resent the fact that all their ideas have to be approved - and usually rewritten - by the "ferocious" policy unit at No 10. They are fed up that their announcements are suddenly pulled by the Prime Minister's strategic communications unit because they do not fit into the "grid", the carefully controlled weekly diary of the Government's activities.

"We're completely hamstrung," one ministerial source said. "The strong centre is meant to drive the agenda forward, but in fact it's holding up everything."

Blair may be telling his ministers to speed up the delivery of government policy, but in fact it may be his own office which is slowing it down. There is now widespread recognition in Whitehall that the Blairite "revolution" will take longer than the Prime Minister expected. "Did we say 1999 was the year of delivery?" one of Blair's closest advisers said. "It was always going to be next year when things really started to happen." New Labour history is rewritten.