Labour loses seat and Tories trail in third

Labour suffered a key by-election defeat and saw its majority slashed in a formerly safe seat in a bad night for the Government.

Labour suffered a key by-election defeat and saw its majority slashed in a formerly safe seat in a bad night for the Government.

The Liberal Democrats overturned a 13,000 Labour majority to come from third place to win Leicester South.

And Labour saw its 11,000 lead in Birmingham Hodge Hill cut to just 460 in what will be seen as a clear warning to Tony Blair of voter anger over Iraq.

But it was a worse night for the Conservatives who trailed in third in both seats.

Labour acknowledged voters had punished it over the war in Iraq. But it said the results showed the Conservatives' hopes of victory at the next General Election disappearing.

Liberal Democrats said in many areas of Britain they had overtaken the Tories as the only party that could beat Labour.

Leicester South, previously seen as a safe Labour seat, saw Liberal Democrat Parmjit Singh Gill elected to become the party's first ever ethnic minority MP.

Labour's Liam Byrne won the Birmingham seat which the party has taken at every General Election since 1950. But the Lib Dems ran it close with their share of the vote up a staggering 26%.

The success of the anti-war Lib Dems was a clear indication of the importance of Iraq to voters, as was the success of rebel MP George Galloway's Respect Party which picked up 3,724 votes in Leicester standing on the single issue.

Both there and in Hodge Hill it comfortably polled well over the 5% needed to save its deposit.

Voters went to the polls the day after Lord Butler published his critical report on intelligence failings in the run-up to the war.

Although the results were a blow to the Government, there will be relief in Downing Street that it was the Lib Dems not the Tories that hit Labour. The Lib Dems are traditionally the beneficiaries of protest votes.

Ministers will be bolstered by Tory leader Michael Howard's failure to make the breakthrough that would have given him the platform to mount a General Election challenge.

Labour's Health Secretary John Reid conceded Iraq had played a major part in the results.

"I have not denied there is an element of protest in the results, nor have I denied that we have got to listen to what has been said," he added.

"All I have said is that it is not entirely about Iraq."

Speaking on BBC News 24 he said: "We need to redouble our efforts because we have got a challenge. Obviously I would have liked to have won both these seats, even in a mid-term by-election.

"Tonight we have effectively had a score-draw with the Liberals. But there has been a disaster for the Conservatives. This presents the Government with a challenge. And I think it presents Michael Howard and his party with a crisis because they are going backwards."

Trade and Industry Secretary Patricia Hewitt told PA News: "What's astonishing is that seven years into a Government Labour has won one election and come a close second in another.

"When the Conservatives went into third place in Brent East, Iain Duncan Smith was sacked as leader so the Conservatives will have to ask themselves what they have to do with Michael Howard when they have gone into third place in two by-elections on one night.

"The Prime Minister's position is absolutely secure. There has been a lot of rubbish talked about it in the media.

"I am in no doubt that he will lead us into the election and will be winning an historic third term."

Tory co-chairman Liam Fox said the Conservatives would never have expected to do well in the seats, despite earlier talking the by-elections up as a three-horse race.

"After an appalling set of results on June 10 this is another very bad result for Labour, who have seen their majority slashed by 11,000 (in Birmingham)," he said.

"Birmingham Hodge Hill is traditionally a very safe Labour seat. For Labour to have lost here - as it almost did - would have meant a total meltdown for the Government.

"Although we fought a robust campaign, we never expected to win here. We have no councillors in the constituency and it is nowhere near being a seat that we would need to gain to win a General Election. What we have done is nearly double our share of the vote from June 10.

"I think the lesson for the Government is that they have to listen. I think there is one very clear message from the local elections, the European elections and these elections: voters feel let down by Labour and they are increasingly looking for a party that will beat Labour."

Liberal Democrat leader Charles Kennedy said Iraq was a major factor in his party's success. He said the Lib Dems would have won both seats were it not for Respect.

"This is a fantastic night of success for the Liberal Democrats. The story of the night is of two party politics in the cities - the Liberal Democrats versus Labour.

"Yet again we have shown that we can take on Labour and win. We have proved that the Liberal Democrats' win in Brent East was no flash in the pan and this will have big implications for the next General Election.

"The Conservatives are going nowhere except further down and out. This demonstrates that in large areas of the country a Conservative vote is now a wasted vote. The Liberal Democrats remain positively on course for a further major stride forward at the next General Election."