Labour leader’s New Year message

Gregg McClymont said Mr Miliband must avoid the “tax and spend” trap set by the Tories by only seeking to appeal to its core voters in the public sector.

Writing for the Policy Network think-tank, Mr McClymont warned that to do so could lead to Mr Miliband suffering the same fate as former leaders Michael Foot and Neil Kinnock.

The shadow pensions minister wrote: “Labour can sidestep the electoral trap being sprung by the Conservatives by refusing to be driven back to its core support.

“A patriotic appeal to the nation to improve growth and living standards, not a simple defence of the public sector and public spending, is crucial to foiling Conservative attempts to render Labour the party of a sectional minority.”

He added: “If the key political challenge facing the country over the long term becomes defined as cutting public spending, then the Conservatives are more likely to prosper. Prolonged austerity reinforces this perception, rather than undermining it.

“The Conservatives could potentially be in a win-win situation. If growth does ultimately return and an end to austerity heaves into view, then they can pledge tax cuts rather than a return to pre-crisis levels of spending.”

His comments come as Mr Miliband said Labour’s “mission” for 2012 was to rise above public cynicism about politics and demonstrate that “optimism can defeat despair”.

He accused the Government of surrendering to a “counsel of despair”, offering only rising unemployment and years of falling living standards for ordinary families.

Mr Miliband said: “Some believe things would be the same whoever was in charge. And others fear the Government is in the grip of forces so powerful that nothing can be done.

“It suits the current Conservative-led Government to go along with this idea. Having failed in their promise to make Britain a safe haven, they now say that there is no alternative to rising joblessness and years of falling living standards for working people. It is a counsel of despair.

“When so many are sceptical about politics the easy route for politicians is to join in and accept the cynicism. To say simply that in hard times nothing can be done. But that’s not why I came into politics and it’s not what the Labour party stands for.

“My party’s mission in 2012 is to show politics can make a difference. To demonstrate that optimism can defeat despair. That politics can rise to meet the challenges Britain faces even when the challenges are so great.”

Mr Miliband acknowledged the country faced difficult choices, but accused the Government of favouring the “privileged few” - using Chancellor George Osborne’s autumn statement to take three times as much from the working poor as from the banks.

“When those in power say, ‘You’re going to face five bad years and there is nothing to be done about it,’ that is a statement of their values and priorities,” he said.

“But neither in Britain, nor across the world, can anyone afford just to stand back and watch unemployment rise, growth stagnate and indeed borrowing go higher as a result.

“When politicians shrug their shoulders in the face of other people’s despair, they are not just abdicating responsibility, they are making clear choices. That is as true now as it was in the Great Depression during the 1930s.”

He said that Labour needed to demonstrate that it could build a “different economy” with a “more responsible capitalism” in order to create a better society for the future.

“Throughout our country’s history, tough times have seen us not lower our sights but raise them. We need equal ambition for the future if we are to avoid our country heading further and faster in the wrong direction: a lost generation of young people, Britain struggling to compete in the world, and greater inequality,” he said.

“These are the stakes facing my generation. This is the challenge to which our politics must rise. This is the challenge to which Labour is determined to rise in the year ahead.”