I said I’d pass on the highlights of the Clarke speech (he is talking right now): Here are a few of his thoughts in potted form. I was most struck by his warning about Labour’s finances and by Brown’s refusal to come clean on the fact that the crash was not only caused by mysterious global forces.

He describes….

Labour’s “awful weakness”

“Our leadership is weak, uncertain, tactically unsure and lacks vision”

Ratings have declined since 2008 despite an “apparently unending sequence of new relaunches…”

“All the evidence is that Labour is not trusted”

Many Labour MPs think they should give up on 2010 and look ahead to 2015 election. But “I reject the compacency and pessimism of these views”….”we still have a chance”….

Brown hasn’t been honest about causes of the eco crash: “It is now critically important that the Labour leadership does what is has not yet been prepared to do and explains fully and carefully how it is that the enormous British economic success story of 1997 to 2007 has turned into the economic adversity of today. It is not enough simply to blame the ‘world economic crisis’, or evil bankers; we also need to acknowledge where we have made misjudgments, albeit in common with others.”

Still a need to end “culture of spin”.

Labour’s financial crisis: “There is a real challenge even to pay the wages of our current staff, and we need nearly £20m just to pay off our debts and keep going until next May. Raising the money to fight a general election campaign seems almost impossible in current circumstances.”

The impact of Charles Clarke’s criticism of Gordon Brown has diminished somewhat with time and repetition. That said, his latest salvo against the prime minister could not be more clear - and it adds to the pressure on Brown.

Here is the Clarke interview in the Standard.

Highlights include….

“The former home secretary said Mr Brown should consider standing down, perhaps citing ill health, adding: “I think his own dignity ought to look to that kind of solution.”

Bringing into the open the debate about Mr Brown’s suitability as the party goes into its final conference before the election, Mr Clarke said that without change Labour would be “out for 10 to 15 years”.

He launched a searing attack on the Prime Minister’s decision-making. “Are we just going to stand by and watch the whole Labour ship crash on to the rocks of May 2010?” he asked.

He said Downing Street under Mr Brown was “the weakest I’ve seen ever”, and less effective than under John Major.”

There is more to come tonight when Clarke addresses a Progress meeting. I’ve seen the speech - embargoed til 6pm - and will give you the highlights then. Needless to say, there is plenty more trenchant criticism of the Brown regime.

It could be worse for the Attorney-General. Not only has the UK Border Agency only fined her £5,000 (against an expected £10,000) but it has accepted her claim that she did check the documents of her (illegal immigrant) employee. Her mistake was the failure to keep those papers.

Here is their statement:

“Following an investigation into alleged illegal working the UK Border Agency will be imposing a civil penalty of £5,000 on Patricia Mawhinney (Baroness Scotland) as the employer of an individual who was not legally permitted to undertake work in the United Kingdom.

“The employer cooperated fully with the investigation, which was carried out in accordance with the Agency’s published code of practice on civil penalties for illegal working.

“Following the investigation, the UK Border Agency is satisfied that the employer did not knowingly employ an illegal worker. The UKBA is also satisfied that the employer took steps to check documents provided to her as proof of right to work in the UK. However, the law requires that employers must keep copies of documents proving the right to work in the UK and in this instance the employer failed to meet this requirement.”

The knives are still out for Scotland, however:

Chris Grayling, shadow home secretary, said this morning: ”After this, we can’t see how Baroness Scotland can credibly stay in her job.”

I pointed out how precarious her position was in this blog last week: It boils down to the fact that she was in government (as a Home Office minister) when this rule was brought in.

Here is today’s news story on ft.com

He finally said it. There will be cuts. But Gordon Brown waited until he was nearly half an hour into his speech to admit it. (Bottom of page 7 out of 8).

And he wedged the stuff about deficit, hard choices, sustainable finances, cutting costs into a handful of paragraphs. The rest of the speech was the usual glorious talk about saving the global economy, the national economy and the range of initiatives which Labour has thrown out in the last year. And - to be fair - there were two genuinely big policy pledges.

More paternity leave and the swift implementation* of the temporary workers directive will please unions and, you’d have thought, workers. The business lobby might not be so happy but neither concept is exactly a surprise (the only question on the directive was its exact timing).

*UPDATE

My eagle-eyed colleague Jean Eaglesham points out that the government is only putting the temporary workers directive on the statute book in the next Parliamentary year. This is not the same as the implementation date. We still don’t know when that is going to be. In other words, this may not be much of a gift to the unions (and temps) as it sounded at first.

The union leaders don’t want to admit it. Brendan Barber argued this morning that Labour should keep on borrowing and spending until unemployment is on the way down - which could be several years away. But the simplistic debate between cuts and investment is now over.

We’ve now heard Alistair Darling and (today) Peter Mandelson both spell out the new message; that the UK is heading for difficult choices in public spending.

Earlier this summer Gordon Brown was maintaining the illusion that Labour would be able to preserve spending increases in the coming years. Here is what I wrote at the time, as a reminder. (Brown said “They (Tories) would cut savagely by 10 per cent and that is not going to be allowed to happen.”)

Now Downing Street is briefing that Brown has always been fiscally conservative over two decades; an attempt to erase the “investment” message of June.

Nick Robinson argues on his blog today that Labour is trying to rewrite history. Francis Elliott wonders just how great the difference is between the two parties.

Not a lot, you might think. In effect, Labour has been reduced to painting the Tories as maniacal small-state ideologues who - in the words of Mandelson - are “salivating about wielding the axe”. Will the public agree?

I’ve gone and pun it again; apologies.

A question for you: Who could be Labour’s most powerful minister in a year’s time?

The answer: Huw Lewis or Carwyn Jones.

Not exactly household figures. But if the Labour government falls the party will no longer hold national government, the post of London mayor nor Edinburgh.

That leaves the Welsh assembly, which has fewer powers than Holyrood. Furthermore, Labour is in coalition with the nationalist Plaid Cymru in Cardiff Bay. First minister Rhodri Morgan (pictured) is set to retire around the time of the Labour party conference - as he hits the age of 70.

Welsh politics was part of my beat as a regional FT reporter nearly a decade ago and I always liked Morgan’s vaguely shambolic - but wily - charms.

None of his potential successors have much profile east of Offa’s Dyke. Huw Lewis is Merthyr Tydfil assembly member, Carwyn Jones is AM for Bridgend. The other likely contestants are Welsh health minister Edwina Hart, education minister Jane Hutt and finance minister Andrew Davies.

I’m told that Jones is the bookies’ favourite but it’s a fairly open contest. Apparently Labour HQ in London is staying out of things after getting burned last time around. Attempts to parachute Alun Michael into the job of First Minister backfired badly on Tony Blair, as you may (or may not) recall.

The Jon Cruddas speech last night was much as you might imagine; strong intellectual content, uninspiring delivery. James Purnell, meanwhile, said effectively nothing - beyond the truly vague - from the platform. Perhaps he is keeping his powder dry for next summer.

Here is a link to the full speech.

One of the most striking points Cruddas made - and I’m not sure it’s in the transcript - was the idea that the left had a moment of opportunity at the peak of the financial crisis; but it is rapidly fading.

“The Labour party conference after September 2008 there was almost a euphoria, an inevitability that our time had come…for our values to reappear,” said Cruddas. (But) “Labour has a terrible record at such turning points”.

In other words; the party was too busy battling the financial meltdown that there was no time for philosophical discussions about redistribution or the role of the state or whatever.

Cruddas was also scathing about New Labour (despite having worked as an aide to Blair several years back):

In Mondeo Man and Worcester Woman we find our old friend Rational Economic Man resurrected in modern garb- the foundation of right wing political economy through the ages.

In this view of what it is to be human, aspiration consists of the impulse to accumulate and consume without regard to the consequences for others or any sense of responsibility to society as a whole.

Here people are considered as individualistic. Unsentimental. Ruthlessly self-interested; that the electorate- or at least the section of it that counted- held fast to a rationality that verged on the misanthropic.
By 2001, New Labour’s policies were essentially based on a mythical ‘Middle England’, drawn up by the pollsters and located somewhere in the South East, built around continuous growth and affluence and where politics always had to be individualised.

Jon Cruddas does not alone speak for the Labour left. But the Dagenham MP is one of the few party figures prepared to spell out an alternative vision to the usual “managerial” style of New Labour.

At a Compass speech tonight he’ll lay out a list of policies which - he believes - could revive momentum within the party.

Some of it may sound radical (scrapping Trident and tuition fees and doing more to prevent grotesque pay in the private sector…and what does he mean by a new “windfall tax”?). There is much here which is likely to play well in the Compass “leftie” heartland. Interestingly, you might also argue there’s little in there that wouldn’t also appeal to the aspirant working classes which are increasingly tired of Labour.

I’d want to know the cost of number 3, however. Does Cruddas?

1 - establishment of a High Pay Commission;
2 - greater tax justice, including closing tax havens and more equal distribution of income and wealth;
3 - index link benefit levels, pensions and the minimum wage to average incomes;
4 - replacing tuition fees with a graduate solidarity tax;
5 - a Fair Employment Clause in all public contracts;
6 - windfall and transaction taxes and resetting capital gains tax;
7 - a new covenant with the military, including more investment in mental healthcare, equipment, housing and support for veterans funded by scrapping plans to renew Trident and re-deploying the money saved within the Minister Of Defence budget;
8 - a Green Neal Deal*, to include scrapping the third runway at Heathrow;
9 - remutualisation of the finance sector;
10 - a credit card bill of rights for consumers.

* Apparently this is not a reference to Neal Lawson, head of Compass, but in fact a typo