Thursday, January 14, 1999 Published at 23:16 GMT
Further step to 'new politics'
The Liberal Democrats arriving at Downing Street
Labour and the Liberal Democrats have decided to build on their informal alliance as the prime minister pushes forward his hopes of building a strong anti-Tory alliance of the centre ground.
Prime Minister Tony Blair said: "I have always believed that where parties agree and can co-operate usefully they should do so. A new politics remains central to New Labour's project to modernise Britain."
Before the announcement the General Secretary of AEEU union, Ken Jackson, launched a strong attack on Labour's ongoing modernisation and moves towards cross-party co-operation.
Writing in Tribune magazine he said: "Modernisation is not the same as ditching the Labour Party. Yet that is what some people seem to think it means. They would rather have a middle-class army of technocrats than a party of working people.
"They would rather merge with the Liberal Democrats than keep the link with the unions.
Backbench Labour MP Gordon Prentice said he thought the two parties have little in common.
He said: "There is a deep seated antipathy amongst most Liberal Democrats to anything collective.
"They can't stand trade unions - that's a pretty big divide between the Liberal Democrats and Labour."
The decision to extend Lib-Labery was made at the parties' joint Cabinet committee which met on Thursday afternoon.
A committee is now being set up and will be headed Foreign Secretary Robin Cook and Defence Secretary George Robertson who will take forward discussions with the Lib Dems.
Lib-Dem foreign affairs spokesman Menzies Campbell said: "Better EU defence co-operation will strengthen Nato by enabling Europe to deal more effectively and promptly with problems such as Bosnia and Kosovo without having to rely on the United States."
The move to further cement relations between the two parties comes after the resignation of former Trade Secretary Peter Mandelson from the government.
Alongside Mr Blair, the former trade secretary was one of the driving forces behind further co-operation between the two parties in the face of opposition from both Labour and Lib Dem backbenchers.
The announcement comes hours after Mr Blair made a speech to mark the 10th anniversary of the Institute for Public Policy Research, where he is pushed his "third way" philosophy in another attempt to put policies, rather than scandal, back in the headlines.
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