Alan Watkins: It's 10-1 the bookies are having a bit of fun

Is Mr Straw or Mr Miliband favourite for next Labour leader? Your turf accountant will decide – but he doesn't have a clue

There is no odds-on favourite on the part of the bookies to succeed Mr Gordon Brown as leader of the Labour Party before the general election. Rather, the odds quoted are 6-4 on that it will be somebody else, so far unspecified. The favourite remains Mr David Miliband. The second favourite in the betting is Mr Jack Straw, or so I read.

I would not believe a word of it. Certainly the figures are published and printed. But they are largely made up – to begin with, at any rate. I once talked at length to a representative of one of our largest bookmaking firms, who specialised in political betting. It was, he explained, a very small part of their turnover. They did it for the sake of the publicity, which was usually favourable and always free. It was, as he said, "a bit of fun".

A friend of mine, likewise a political journalist, used to receive a Christmas hamper from the firm concerned, in grateful appreciation of the advice received in respect of by-elections, leadership contests or whatever it might be. Alas, I never managed to get myself on to any such advisory or consultative list, though others besides my old friend clearly did. There we are.

I did, however, contrive to invest, as the bookies like to express the matter, in Michael Foot at 14-1 to win the leadership of the Labour Party in 1980. Those who are said to know the world conclude that the "weight of money" would have favoured Denis Healey in the same contest. Anyone who knew the first thing about the Labour Party would have realised that Mr Foot was ridiculously underpriced.

Is anyone seriously telling me, that last year, large sums were invested in Mr Hilary Benn to make him favourite to be deputy leader of the party? I doubt it.

I think that what happened was that the bookies had assumed that Hilary was an offspring of Mr Tony Benn, as he duly turned out to be, and that he was Tony's daughter, so rendering the bet more attractive.

Indeed, one of the fraternity admitted afterwards that they had always thought Hilary was a girl – much as the Times Literary Supplement had reviewed a book by Evelyn Waugh as "Miss Waugh" in the 1920s. Then the bookies did not switch to one of the genuine women, Ms Harriet Harman, but to the safe choice of Mr Alan Johnson.

The bookies also got it wrong in Glasgow East. They were there, on the spot, taking bets. Their conclusion, according to Thursday's papers, was that Labour would just manage to hang on. There is no disgrace in getting a by-election or any other result wrong. What it shows is that bookmakers are not a unique repository of political wisdom.

Mr David Cameron has been calling for a general election. That is a perfectly reasonable thing for Mr Cameron to do. It is part of his job. It is going too far to say that staying in office is part of Mr Brown's job. It depends.

In December 1923 Stanley Baldwin went to the country on the issue of tariff reform, though the Conservative Government had been in office for only just over a year and possessed a large majority. The Conservatives were the single largest party but put Labour in office as a minority government. Baldwin was back in office after the election of October 1924.

Clement Attlee was less fortunate. He was not in good health, several of his senior ministers were ill or dying, and his government was running out of ideas. It had a majority of five.

The wisdom of the time was that no government could survive long with such a majority. Indeed, improper pressure was exerted on the Labour Cabinet by the Palace to hold a general election. After something over 18 months, Attlee succumbed, so inaugurating the 13 supposedly wasted years of Tory government (though I remember them as quite good years).

In 1974 Edward Heath had been Prime Minister for over three years and had a comfortable majority. The miners' strike had been going on and Heath held an election asking the question: "Who governs Britain?" "It certainly isn't you, mate," was the reply. Harold Wilson became Prime Minister for the second time round, or for the third time if you count the election in 1966.

James Callaghan deserves some credit for keeping the show on the road for just over three whole years. In this he was helped by David Steel and the Liberals, though they got very little out of the arrangement. By 1979, when Margaret Thatcher moved her vote of confidence, Callaghan had had enough. Mr Foot (who celebrated his 95th birthday last week) had a wheeze to reverse the vote of confidence, which might or might not have worked, and to carry on in to the autumn. But Jim was having none of it.

It is often forgotten that, if she had chosen to do so, Mrs Thatcher could have sat in the Cabinet Room and fought. My guess is that she would have defeated Michael Heseltine or anyone else in the Conservatives' second ballot. We do not know whether she would have won the subsequent election in which John Major was confirmed as Prime Minister.

We do know that Sir John, as he has now become, chose to seek re-election as leader of his party while remaining Prime Minister. Mr Brown would almost certainly not be prepared to volunteer to submit himself to such a process.

Others, however, might still initiate a process of this kind. For years and years, the Labour Party did not feel the need to have a procedure for getting rid of a Labour Prime Minister. The occupancy was so rare that the party considered itself lucky to have anyone in Downing Street at all. In the 1990s, after Callaghan but before Mr Tony Blair, the rules changed.

They say: "When the PLP is in government and the leader [is] Prime Minister, an election shall proceed only if requested by a majority of party conference on a card vote."

They also say: "When the party is in government and the party leader is Prime Minister and the party leader for whatever reason, becomes permanently unavailable, the Cabinet shall, in consultation with the NEC, appoint one of its members to serve as party leader until a ballot under these rules can be carried out."

As far as I can tell, a challenge to Mr Brown could still be possible. It would even be possible for Mr Brown to mount a challenge to himself, as Sir John did in 1995, though little good did that do him. But more likely would be the deputation of old lags. Mr Straw might well emerge as the acting Prime Minister. A ballot there would surely have to be, with or without Mr Straw as a candidate.

The Labour Party loves to talk but is disinclined to act. This is an amiable characteristic. Many more people in the United Kingdom and outside it would still be living today, in one piece, if Mr Blair had not been so keen on action in far-flung parts of the world. In the meantime, I would not rely on the bookmakers.