Bill after Bill – but none set Labour hearts glowing

The sword of Damocles is still hanging over Gordon Brown, in spite of his efforts to rescue himself with today's draft Queen's Speech and yesterday's £2.7bn tax handout to low- and middle-income earners.

The list of Bills that are being brought forward went down like a cold bowl of porridge with his own MPs. "It was dull and uninspiring," said one Labour MP trooping out of the chamber afterwards.

The mood around the tea-rooms is funereal. The only Bill to excite interest around the Labour backbench was a vague promise to extend employment rights to agency workers. The unions have been pressing for this for years to stop the exploitation of migrants as cheap labour. Brown's team are worryingly hazy about the details, saying they are working on resolving objections in the European Union that may make it possible to announce a measure in the next fortnight.

Other parts of the legislative package were disappointingly Blairite for Brown's own supporters. He is driving on with the modernising agenda on the NHS and even threatening to open failing hospitals to fines. When Downing Street aides are asked how withdrawing money will help failing hospitals, MPs were referred to Alan Johnson, the Health Secretary.

Housing was intended to be the flagship policy to reconnect Brown with his natural constituency in the remaining councils that are still Labour-held. But here again, he has disappointed his own side. He has set his face against the unions' demands for local councils to be allowed to build more houses for rent using the rental income to finance the spending.

Instead, Brown announced a £200 million fund to purchase unsold new homes and then rent them to social tenants. Alan Simpson, the Labour left-winger, is telling friends it is a "bale-out for housing spivs" - the would-be buy-to-let landlords or property developers who have been caught out in the credit squeeze, and need to capitalise fast on their assets.

Caroline Flint, the Housing Minister, who had a red face after being caught with her slips showing - her private briefing notes for a Cabinet meeting revealed that house prices would fall a further ten per cent next year - is also announcing £100 million for shared equity schemes. But that falls way short of the dramatic return to council house building that Labour MPs and unions have been agitating for.

There is also another immigration Bill in the list, setting out the eligibility requirements for UK citizenship. One shadow Cabinet minister was overheard saying later: "This is the sort of thing we used to do when we were on 24 per cent in the opinion polls."

Cameron was able to claim that a lot of the schemes were stolen from the Tory research department, leaving Brown's Labour backbenchers feeling decidedly uncomfortable. "This Queen's Speech has nothing to do with the long-term needs of the country. It is all about the short-term survival of the Prime Minister," said Cameron.

However, Brown's own side suspect it will cut little ice in Crewe and Nantwich, with a week to go before the by-election. If Labour lose the seat to the Tories, it will be the first time that the Tories have taken a seat from another party since Tessa Jowell was defeated at the Ilford by-election in 1978.

"If he loses Crewe and Nantwich, people will question his leadership," said one disgruntled Labour MP. "There will be a large number of Labour MPs who will not go quietly to their graves. Gordon will be told that he may be committed to the party, but he hasn't got the right to sink it."

THE MOLE: DRAFT QUEEN'S SPEECH

FIRST POSTED MAY 14, 2008