Suddenly it is realistic to talk of the beginning of the end of Blair

The British Prime Minister is widely expected today to agree to a referendum

The British Prime Minister is widely expected today to agree to a referendum. Will he go down in flames or emerge rejuvenated? Frank Millar examines the possible scenarios

It seems Tony Blair has a "reverse gear" after all.

This was among the kinder comments circulating yesterday as Westminster anticipated the most spectacular U-turn of the New Labour years.

Wouldn't it be ironic if hostility to his alliance with President Bush helped the Prime Minister to victory in a British referendum on the proposed new European constitution? That thought will certainly have occurred to some of Mr Blair's advisers as the finishing touches were put to today's Commons statement, widely expected to pave the way for a public vote Mr Blair and his ministers have repeatedly insisted would not take place on their watch.

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So too, of course, will the haunting alternative - that protracted violence and instability in that far-off country could prove the undoing of Mr Blair just as he might think to fulfil his European promise, claim his chosen place in the history books and depart the British political stage. And yes, whatever the outcome, it suddenly seems both permissible and realistic to contemplate possible exit strategies and at least the beginnings of the end of the Blair era.

One-time Labour foreign secretary Lord (David) Owen ventured yesterday that Mr Blair might find it prudent to hold a referendum in the autumn of this year and then gracefully retire before the general election.

An experienced Tory strategist, on the other hand, bowed to the prevailing wisdom that the Prime Minister would not risk Labour heading into an election on the back of a referendum defeat. Implicitly accepting that Mr Blair is still set to win that election when it comes, he suggested: "He'll look at the Thatcher precedent and decide he really doesn't want to go on and on, take the referendum option and go out on a high fighting for something he actually believes in."

That Conservative belief that Mr Blair will find it impossible to turn around entrenched eurosceptic sentiment may be well founded. However, the notion of a sanguine Mr Blair finally going "glorious in defeat" is distinctly unconvincing. Much more to Number 10's taste certainly will be the prediction by former Europe minister Keith Vaz that Mr Blair can win any referendum on the constitution by giving the lead, and then follow it up with a second victory - for British membership of the euro.

History-making indeed, as they would have it in Downing Street. And if Mr Blair does deliver a firm commitment to a referendum on any deal concluded under the Irish presidency in Dublin in June - and not some mere manoeuvre designed to close the issue down in face of an expected Labour drubbing in the European elections - we can expect to hear much more about the historic choices facing the British people. Mr Blair has already set the terms for the debate, in which he will characterise the choice as one between participation with the other 24 EU members or effective British withdrawal. Alongside the high-minded rhetoric, of course, will sit allegations of low cunning and party calculation, subservience to Rupert Murdoch's media empire and full-scale retreat on the referendum issue in face of the threatened loss of the Sun's backing for Labour at the general election.

Embarrassed Labour Europhiles sought to dismiss this yesterday. But the truth was more evident in the immediate angst of Conservative leader Michael Howard - forced to welcome the decision, if such it proves, to hold a referendum, while suspecting Mr Murdoch may well have shot his fox and opened the door to renewed Tory divisions.

That said, it will still be an astonishing gamble for Mr Blair. To be taken at face value about his high purpose, he cannot be seen endlessly to delay a referendum - thus feeding the suspicion that he wants some other European country to scupper the proposed constitution and spare him the trouble of ever having a British vote. And to win the vote - and convince the British people this is not the arrival of the European superstate - the Prime Minister will need to have restored his reputation for trust. To have a hope of doing that, Mr Blair (and President Bush) will need a protracted run of successes in Iraq.