Newbury will be a non-event, unless . . .

THIS week's Newbury by-election will not, in itself, matter at all. As an event, it will be largely meaningless; as a news story, mostly spurious. You can safely ignore most of what you read about it, whether the Liberal Democrats and the pollsters win, or whether the Conservatives do. But there could be a 'Newbury effect' - so long as Labour treats it seriously. But Labour was irrelevant to this by- election? Precisely.

By-elections, in general, are not important. They have a strange glamour: the early morning press conferences, the weird fringe parties, the candidate with a Hidden Past. But they have long been a way for irate voters to kick Conservative governments without hurting themselves.

Uncle George can enjoy shocking the aunts by admitting that he defected to the Lib Dems: 'And frankly, if Major doesn't pull his socks up, the blighter may have lost me for good.' Uncle George glares at himself in the mirror and feels considerably better. He is not, perhaps, such a stick-in-the-mud fellow after all, hmm? (But come 1995-6, as all present know full well, Uncle George's views on income tax will return him to the Tory fold.)

Because of Uncle George, we can discount most midterm Tory losses at by-elections and be disproportionately surprised when the ruling party holds on to its seats. Meanwhile, it is in everyone's interests to pretend that by-elections are more interesting than they really are.

Newbury is no different. A defeat there, plus poor local election results, would be an irritant for the Prime Minister only because they would interrupt the narrative flow of the story called 'Tories recover'. Conversely, if they do hold the seat, the achievement will merge with last month's economic indices; an essential part of the tale that leads to John Major's next election triumph.

But again, either way, this is not so important for Mr Major. It would be nice to have his annus horribilis over so neatly, but he is a realistic man. There will be setbacks and the rebuilding of Conservative morale cannot happen overnight. He is faced by no leadership revolt. He has time.

So how does Newbury matter? It matters only insofar as the opposition leaders let it influence their strategic thinking. At the moment, Paddy Ashdown is keen on some informal alliance of ideas, if not of candidates, between his party and Labour. He should not let a victory at Newbury go to his head: a defeat would ram home the urgency of a single opposition reform movement. John Smith is less keen. He still hopes Labour can win on its own, without too many upsetting internal rows first.

The danger is that Labour's traditionalists will take comfort from Newbury, whatever happens. They will see a Liberal Democrat victory as a general expression of anti-Tory feeling, justifying those who think the Tories will simply destroy themselves, allowing Labour to waltz back into power. (Do they honestly believe this? Yes. One senior and deluded member of the Shadow Cabinet put it in virtually these words quite recently.) Alternatively, a Tory win would be used to denigrate the value of any Labour tilt towards the Lib Dems as 'they never deliver'.

Until now, Mr Smith has kept himself hovering just above the vital argument between reformers and the one- more-heavers. He has called for an end to trade union votes in candidate selection and leadership votes; refused to direct Plant Commission loyalists to kill off the possibility of voting reform for the Commons; and developed an emphasis on constitutional change that is new for Labour.

Now, though, there are worrying signs that the one-more-heave tendency is triumphing. An alliance of the big trade unions has been forged that could defeat Mr Smith's proposals for an end to the union vote at this year's conference. Crude and shameless political threats are being aimed at the most prominent reformer, Tony Blair. Essentially, the message from bosses of the big unions is: back off chum, or give up any hope you have of ever becoming Labour leader.

Only Mr Smith can ensure that Labour's internal reform programme goes ahead. If he does take on the unions he will probably win: they need Labour even more than Labour needs them. Trade unions ought to be backing Labour if they think the party's policies will help them; instead, it seems, union officials see it as a brutally simple deal: votes for cash.

Well, if that is still the deal when Labour fights the next election, ostensibly as a reformist, pro-change party, Labour has had it. Mr Smith has the power, as leader, to point this out and have his way. But if he uses continued Tory disarray, whether at Newbury, in the local elections or in the Commons, as an excuse to avoid confrontations about what kind of party Labour is, it is highly unlikely he will ever become Prime Minister.

Whether or not Labour and the Lib Dems ever do a deal, Labour is still the sort of party that alienates the large majority of voters in socially mixed, expanding and productive places like Newbury. This by-election can be important if Labour focuses on the fact that it was a straight fight between Tories and Lib Dems - and that this would have been the case in any by-election held across much of southern England.

If Labour treats the by-election as a salutary, and slightly shocking reminder of its unpopularity, Newbury will have been a significant event. If not, it will quickly fade from memory as another bland signpost on Labour's march to irrelevance - to the refashioning of Britain as a country where only one party matters.