Livingstone could be back in the Labour fold by next year

Ken Livingstone could be readmitted to the Labour Party as early as next year, according to a leaked memo obtained by The Independent.

A confidential memo, drawn up by the leader of the Labour Group on the Greater London Assembly (GLA), states that Labour should make a decision on Mr Livingstone before local elections in May 2002.

The document, written by Lord Harris of Haringey, is the first concrete evidence that Labour is actively considering a return to its ranks for the Mayor of London and ex-MP.

It emerged last night after Mr Livingstone had delivered a keynote speech calling on the Prime Minister, Tony Blair, to stop "dithering" and campaign for Britain to join the euro.

Mr Livingstone is still viewed with suspicion by some in the Labour Party. However, some London MPs used him to campaign with them during the election, and an increasing number of senior figures want his future to be decided soon. Mr Livingstone campaigned successfully in key marginal seats in London – in Hendon, Harrow East, Finchley, Golders Green plus Hammersmith and Fulham – with the respective MPs believing that the "Ken effect" helped their chances.

In his memo, titled 'Labour Group Policy Following the general election', Lord Harris outlines several criticisms of the Mayor's performance in the capital. Yet he also makes clear that Labour's ruling National Executive Committee (NEC) should decide whether Mr Livingstone should be allowed back as a member.

"The question of whether the Mayor is readmitted to the Labour Party is not going to go away. The worst of all possible outcomes would be for the NEC to leave a decision until just before the next GLA elections [held in 2004]," he writes. "It would be better to have the debate now and get it out of the way, perhaps with a decision dependent on how Ken behaves during and in the run-up to the borough elections [in 2002]."

A source close to Mr Livingstone said last night that it was up to the Prime Minister, ultimately, to decide whether he would be readmitted to Labour's ranks, and could be a Labour candidate for Mayor. "These comments indicate that there are many in leadership of London Labour Party who, very sensibly, want to resolve the issue of Labour's relations with the Mayor," the source said.

Speaking at the launch of the London in Europe campaign, Mr Livingstone said: "Tony Blair's premiership will be defined by his stance on this issue. Dithering would be fatal. The Government must launch, by the autumn at the latest, a full-blooded national debate and campaign on euro membership, or all the potential created by Hague and Portillo's defeat will be lost."