Hackney Downs, east London, on a crisp Monday morning in March is a prosaic setting to celebrate a new-Labour triumph. Mossbourne Community Academy, designed by Lord Rogers, the architect of grands projets like the Centre Georges Pompidou in Paris, is also a temple to Blairism.

As his days in office draw to an end, this outstanding school is everything Tony Blair would want to be remembered for, the legacy he leaves Britain, the Labour party and his likely successor, Gordon Brown.

Once a local grammar, the powerhouse of academic talent that produced the playwright Harold Pinter, the dramatist Steven Berkoff and the Thatcherite ideologue Sir Alfred Sherman, the school turned into a proverbial sink comprehensive under Labour. It was closed in ignominy in 1995 by the Tories after it had been described as “the worst school in Britain”. A transport magnate and local boy, the late Sir Clive Bourne, raised £2m to sponsor this new institution. Working with Sir Michael Wilshaw, an inspired headmaster, they created a new school that attracts a socially, racially and academically mixed intake whose outstanding progress has been commended by HM inspectors.

So it is at Mossbourne that Blair is choosing to make his final stand. The city-academy programme is his baby. It was his hand-picked education adviser, the schools minister, now Lord Adonis, who devised it and thrust it upon reluctant bureaucrats, local politicians and trade unions – a tangible victory for new Labour. Everyone agrees that education standards must improve if Britain is to compete with the Asian giants. Blair’s ambition is to place a city academy in every education authority to act as a beacon to other state schools and give a ladder of achievement to bright working-class children.

In the assembly hall, a motley audience of scribblers join the kids here to see Tony Blair and Gordon Brown come to symbolic agreement over a radical policy document designed to decide Labour’s future after he goes. Ambitious, even foolhardy, to try to bind your successor’s hands.

On a background of pink screens in front of pink tables, Blair talks with weary passion. In his final year of office, he is more stubborn and convinced of his rectitude than ever before, less willing to charm.

This is fag-end Blair. Talking to him in private, too, at No 10 about his mission in his final months of office, there is a permanent wired tension about him now that wasn’t there before. He is still fighting every day for what remains. The face is still handsome, but the hairline is receding and the tan or powder masks deep lines and the strain of 10 years of office.

Finally, Gordon Brown is called upon to give his blessing. He was once a driving force behind the creation of new Labour, but is thought by the Blairites to have lost his appetite for reform somewhere along the way. We ask Brown whether he agrees with all of Blair’s most radical ideas. “The answer is yes,” he smiles, and Blair sighs visibly like an anxious parent whose troublesome child at last produces the right answer.

So after months of skirmishing and ill will, Blair has received an endorsement of his political vision from his old friend and rival. Or has he?

This is Gordon’s first visit to one of Tony’s show schools. Nobody really knows what he thinks about them: voluble on the subject of education in the Third World, he has never taken a lead here. The Department of Education doesn’t know. Ministers I talk to don’t know. The No 10 praetorian guard doesn’t know and nor, in slightly strained conversation, does Tony Blair. There is a briefing that Brown will mention them in his budget speech. In the event he didn’t.

Perhaps with an eye to his Treasury coffers, he has read reports condemning the huge sums involved in building them. Architects like Rogers and Lord Foster, of Gherkin fame, don’t come cheap. The tough-talking National Audit Office found that only 22% of academy pupils last year scored five C grades at GCSE, though the schools were found to be “on track to deliver good value for money”. Clearly not all of them are doing as well as Mossbourne.

Some Blairites harbour dark thoughts. Last year, in the finest speech of his career, Alan Milburn, the former health secretary, gave a defiant outline of “vanguard” new Labour. It was a mistake by old Labour to make a shibboleth out of state provision of public services, said Milburn. All that matters is the quality of service, freely provided at the point of use. If the private sector can provide better health and education than the state, then it should be encouraged, not thwarted. The patient in the health system should become a consumer, free to pick any hospital of his choice for treatment. Parents of children should have a choice of state education provided by private enterprise as well as the council. If the social-democratic Swedes can do it, why not Britain?

Hark back to a speech made by Brown in 2003. The chancellor thundered away: the consumer could not be king in the health service; the patient is too ignorant to choose. He added decisively that “equality of access can best be guaranteed not just by public funding of public health care but by public provision”. Brown circulated to cabinet a 50-page assault on the health secretary Milburn’s foundation hospital trusts, and Blair’s most radical minister quit the government. The prime minister, as many of his allies have also found to their surprise, did not come to the rescue.

Milburn thinks he knows what Brown stands for: a veneer of reform over a core of centralised Whitehall control. Other Blairites without his history of conflict with the chancellor try to give him the benefit of the doubt. But they would prefer a contest for the Labour leadership, if only to force Brown out into the open about what he believes.

Some hate his guts personally. Years of warfare between the camps have seen to that. And as chancellor it was Brown’s job to frustrate the ambitious spending plans of many ministers.

Brown, a political poker player, wants to keep his card hand hidden. A royal flush of reforms is hinted at for his first 100 days. But some may think they have a right to be let in on the secret of our leader-in-waiting’s opinions before he moves into his neighbour’s house.

Which takes us back to those academies. The prime minister has desperately expanded the programme in his last year, but a complete national system is hardly in place. If Brown doesn’t approve of the programme, “he does not consciously have to wreck it: he need only put do-nothing ministers in the departments”, says one insider. “If a Brownite takes my job, there won’t be more academies because the local authorities already oppose them.”

Only a few months before, another city academy had received a distinguished political visitor. David Cameron, the increasingly poll-buoyant Conservative leader, has opened one at Canons Park, north London. Evidently he liked what he saw. Cameron needs a shiny new education policy. He has dropped talk of restoring the grammar schools or bringing back open selection by ability. It must be tempting to promote academies and specialist schools in an appeal to cash-strapped middle-class parents. He may see an opportunity to build on the NHS’s new co-operation with private enterprise. More tempting still, if Brown shows no enthusiasm for these developments, he can cite Tony against Gordon. And renew his attack on Brown as the “roadblock to reform”.

Let’s travel back to a venue far removed from the brave new world of Lord Rogers’s futuristic architecture. On a makeshift platform last September in a small community hall in York, unobserved by the cameras, Tony Blair is “giving the performance of his life”, according to an insider. His audience, seated on old plastic chairs, are a few worthies gathered by the Rowntree Trust. Blair has just received word that a coup has been hatched against him at the weakest ebb of his political fortunes. In a Wolverhampton curry house, a Brownite junior minister, Tom Watson, has combined with the “office-hungry” backbencher Sion Simon to call for his resignation. Chris Bryant, a former Anglican priest, signs up too. They are circulating a letter drumming up support from the 2001 intake of Labour MPs. Brown is believed to be behind it. Blair won’t leave the hall to plot his defence. He gets up to speak “without breaking sweat”, then calmly and courteously goes through a prolonged question-and-answer session, lingering to press the flesh. His angry and bewildered aides can only think of imminent unemployment.

Afterwards at dinner there is a minute or two of glum silence. “You can hear the knives and forks scraping across the china,” says one of those present. Then Blair cracks a joke and talks about football. The press officers are eventually dismissed, one of them still in tears of rage at the plot. Blair calmed her down.

Only later with his intimates will he “return cool-headedly to analyse his predicament and work out a battle plan”, says one of his chief policy-makers. Blair’s strategist continues: “He is the man least likely to cry over spilt milk I have ever met. I wanted to strangle Sion Simon with Chris Bryant’s braces, but he showed no personal bitterness, just steadily worked out a strategy with us. Most people would in his shoes like to go to their house and crack bottles on their heads.

After his third election victory, his MPs think that he has, Thatcher-like, given up listening. The man who always had an instinct for trouble keeps finding himself up to his neck in it.

That summer, MPs were enraged by their leader’s refusal to call for a ceasefire in Lebanon while Israel’s armed forces pounded away at Hezbollah positions and civilians died in the crossfire. Blair was at one with Bush again, as over the hated Iraq campaign. Labour’s erstwhile supporters in the press howled with fury. And Milburn and his friend Stephen Byers had provoked the Brownites with more “ultra” proposals for reform, which weren’t disavowed by No 10.

An interview with The Times about his future, which was intended to signal a readiness to depart, instead came out as a plea for four more years. “I really think it is absurd for the people who say we must stop this continual speculation about the leadership to continue to speculate about it. I’m not the one who keeps raising this issue,” said Blair. “I have done what no other prime minister has done before me. I’ve said I’m not going to go on and on and on, and said I’ll leave ample time for my successor. Now at some point I think people have to accept that as a reasonable proposition and let me get on with the job.”

“It was a terrible cock-up,” laments one of the prime minister’s longest-serving aides. “He sounded like Thatcher boasting about going on and on.”

Conversations between Blair and Brown on the timing of his going had always been fraught. They got worse. Brown never trusted Blair to keep his vague promises about a departure, and would not promise to call off his troops. He wanted a schedule. He wanted guarantees that no Blairite would run against him.

He wanted Milburn and Byers to shut up. Blair never felt why he should help – three historic election victories in a row and years of Brownite plotting cancelled all past debts. After one calamitous row following the Simon-Bryant-Watson coup, a No 10 insider spoke to me of this famously neurotic political marriage: “The two have different calculations of what was said. I sat outside the meeting feeling like a kid sitting on the steps waiting for two parents to say when we are going on holiday. The two come out and tell us what they have finally decided. One says Lanzarote; the other says San Francisco!”

But was the coup by Brownite supporters, if not Brown, a miscalculation? Was Tony going to go anyway? It would not be the first time in history that a cock-up had led to a conspiracy.

Even those close to him are not allowed to know Blair’s innermost thoughts, so perhaps Brown and others misread him. “You have to remember No 10 is like a court,” I am advised. “He likes to keep everyone on their toes: he will tell you only part of the story. There are four or five Tonys and I expect only Cherie knows all of them. Even after [his warring political gatekeepers] Sally Morgan and Anji Hunter left and those obvious rows were over, nobody dominated his time and counsel. I think no individual did before then, not even Alastair Campbell.”

One Downing Street insider who has been with him from the beginning says: “I don’t know what was going on in his head then.” However, one remarkable account of Blair’s real intentions given to me by someone with hard evidence suggests that the coup was a monumental blunder. With ill-concealed contempt, he declares: “The myth about Gordon Brown is that he is straight. The myth about Tony Blair is that he is candyfloss. I repeat, these are myths. Every Saturday Blair thinks at Chequers about a view on politics and writes it all down and circulates the notes to his [few] intimates. In summer he writes a long, 16-page one. He thinks in writing. He is not just a plausible salesman. His notes can be immensely self-critical.” He refers to himself in the third person or as “TB”.

“The most remarkable documents to be published will be Tony Blair’s own documents. We don’t fall out,” he says of Blair’s inner circle. It’s always the same people: Anji Hunter, Alastair (Campbell), Sally (Baroness Morgan). “There are 9 or 10 of them inside and out of No 10 who get them.” The Blairite adds: “I saw his note that summer. He said, ‘In terms of managing conference my people should be indicating it should be my last.’ But the move from orderly transition to ample time had to mean next year not the year after and was taken by everyone as such.”

All the Blairites without reservation think the coup backfired; it was unnecessary; it boomeranged on Brown. “He [Blair] wanted people to know that this was his last conference but he didn’t want to publicise it. The coup was not about his going in summer but being hustled out now.” Blair wanted to serve his 10 years.

Later in that fatal week in September, The Sunday Times reported a meeting between the rebel Tom Watson and the chancellor at his Scottish home while the coup was in progress. The Brownites protested that it was a “purely social visit”. But “Your story about Tom Watson and his contacts with Gordon Brown was immensely helpful. The plotters were outed,” I was told by one of Blair’s grateful courtiers. A counter-petition urging loyalty to Blair faced down the rebels. “MPs from many marginal seats were apoplectic about having him hustled out,” says an adviser. “Whereas the Thatcher coup turned on the belief she had gone mad after the poll-tax disasters and the opposition to German unification, no one thought Blair had gone off his rocker. Those non-aligned to Blair or Brown saw it would have been in defiance of the public will and the election result to get rid of him.” Ministers rallied too. With the coup backfiring, Brown refused to thrust the dagger home. Blair survived… at a price. He was forced to acknowledge earlier than he planned this would be his last Labour conference. Brown was caught grinning in his car by the photographers. He was thinking about his newborn son, Fraser, he claimed.

Blair had bought himself one more party conference, the prime showcase of his rhetorical talents. But what would he do with his extra span of political life now that he was definitely going by the end of next summer? Would he hover around as a spectral presence unable to influence events?

The answer was an attempt to sign up all leading players, including Brown, to a Blair political settlement. Matthew Taylor, his strategy chief, came up with the idea of a policy review earlier last year to renew the government’s purpose. In his spacious new office at the Royal Society of Arts, he dusts off his draft and shows it to me. In his final year, Blair would not be “a lame duck” but would renew Labour, secure his legacy and tie the hands of his successor in so far as he could. Others were more sceptical. “Why was the whole business held in private at Brown’s insistence?” asks an ultra-Blairite. On the one occasion that the review was open to public scrutiny, Brown ostentatiously walked out early.

“I wish we were four years ahead of where I am now,” says one reformer about Britain’s still creaking and unpopular public services. Blair concedes that education and health should have seen swifter advances. A great politician with an intuitive grasp of what the British public would accept, Blair would not drive public opinion forward in the manner of Margaret Thatcher… with the single exception of Iraq.

In Labour’s first term, the trick was to balance the books and look like a competent successor to the Tories. In Labour’s second term, money was lavished on the underfunded public services. In a third stage, crude targets were handed out Stalin-like to improve performance and delivery. Now in his fourth phase, Blair decided he wanted change “driven by consumers, not producers”. He has left it very late.

Desperately he pushed ahead on his education and health reforms. He didn’t care what his reluctant party or chancellor thought now – especially since Brown couldn’t afford another coup. He was going to ram it down their throats. “If you are going to kill someone, kill them. Finish the job,” says an adviser high in the esteem of the prime minister. “It’s a fundamental lesson of Machiavelli. After that failed attempt they couldn’t do it again. They lost a lot with the public.” Blair was now more determined than ever to ram huge decisions through parliament without regard for Brown. Blair would adopt a scaled-back version of the EU constitution that would not be put to the British public in a referendum. Blair selfishly railroaded the renewal of Britain’s American-supplied nuclear independent deterrent through the Commons. This clearly could have been left to Brown. It implied an insulting and unfounded doubt about the chancellor’s support for Britain’s nuclear capability. A start was made on pensions reform. Blair pledged his government to nuclear power, and a green revolution the implications of which he had hitherto avoided.

Brown has taken the security agenda on board, but remains opaque in other areas. “My only hope is that Gordon is playing Napoleon to Blair’s Snowball,” groans a Blairite minister. In Animal Farm, the Stalin-like pig, Napoleon, urinates on his Trotsky-like rival’s plans, then resurrects them as his own as soon as Snowball is vanquished. But if Brown moves even a step to the left, then Cameron can neutralise Tory unpopularity by claiming the middle ground. Blair’s reforms will come back into fashion. “Aspirational Middle England will want them,” I am repeatedly told.

But the decision to hang on comes at a price.

The academies programme needed rich sponsors. Was a political honour the price to be paid? This newspaper found out that one member of the team was prepared to offer such inducement. Then it revealed that four businessmen whose honours had been blocked by the Appointments Commission had loaned Labour large sums of money. A welter of appalling headlines followed.

Once an official complaint was made by a Scots Nats MP, the police had to investigate, and that investigation had to avoid looking like a whitewash – the Hutton and Butler reports had silkily exonerated the prime minister from duplicity over Iraq. The Metropolitan police commissioner was thought to be too close to new Labour. The Yard’s investigation had to be seen to be above board. At the height of the storm, Blair was forced into the humiliating position of being interviewed by the police, one “honour” never granted hitherto to a prime minister.

One outraged Blair gatekeeper from the early days snorts that the whole thing is a media squall, a joke in poor taste leading nowhere. Another friend blusters that “British politics are the cleanest in the world.”

The Labour view is that under Thatcher it would have gone ahead largely unremarked: “We have given the process transparency.” Another former key aide, misty-eyed, looks out of the window and takes a vow of silence: “This could have been any of us – these people are my friends.”

This inquiry awaits an outcome. Blair’s reputation may be unmade by it. Yet this overlong transition period has not been kind to Brown, either. His polling steadily declines and the economic picture on inflation darkens. Controversial old decisions, like his raid on pensions and his sale of Bank of England gold bullion, come back to haunt him with the release of civil-service documents under freedom-of-information rules. Labour grows restive as the public show signs of tiring of Gordon as they tired of Tony.

For many Blairites, the unfinished business remains Brown. Could he be stopped? At the very least, should the chancellor be made to reveal himself to the world? Shouldn’t they skip a generation to renew the party?

Rewind to the cabinet reshuffle last year. The Home Office is out of control again and a moderniser of independent views, Charles Clarke, is for the chop. “It was a huge strategic mistake removing Clarke to fix a temporary crisis. It was a disproportionate response. He should have held his nerve. Charles was one of his people.” Was this the man who could have taken on Brown or was it his successor at the Home Office, John Reid, fancied by the same pollster who had tipped Cameron for the top?

Exasperated by Brown’s assumption of an unopposed entry into No 10, Clarke gave a stark warning that Labour risked “sleepwalking to disaster” if it did not regain the political initiative from Cameron. Clarke and Milburn launched a website to debate the future direction of the party. Afterwards, Clarke said: “The Labour party doesn’t belong to Gordon or any one other individual. I don’t want to see us simply assuming that our record will secure us another victory. It won’t. We need to reinvigorate

and revive what we stand for if we are to avoid sleepwalking to disaster.” But if Clarke’s own prospects and those of his successor at the Home Office were damned by running a department notoriously “not fit for purpose”, who would do the job? Reid doubts that another Scot could win over the English – though he has half a hope that performing well during some terrorist crisis might give him the prestige to stand. Clarke broods enigmatically.

That left the prospect of skipping a generation and finding a young Blairite. “David Miliband should have been the challenger to Gordon,” a No 10 insider tells me. “Blair’s cabinet reshuffles were always about party management. He wasn’t thinking of a successor – just like Mrs Thatcher.”

To slay Gordon, the latter-day Goliath, the young David needed to gain sufficient stature and self-confidence and that could only come through promotion. “David should have been made foreign secretary, not Margaret Beckett. In fact, in the reshuffle before that, he should have been made education secretary instead of Ruth Kelly.”

But the famously botched cabinet reshuffle pitched Beckett into the Foreign Office, much to her own surprise. “F***,” she famously exclaimed on being offered the job. “F***,” or something like it, said the commentators. “No one has explained that to me,” says one minister. “Tony clearly did consider David and decided against. If Jack Straw had been replaced by Miliband, it would have been greeted as a masterstroke, re-energising the government and putting Gordon in his place, in one move. The Brownites would have been terrified if he had stood, and the extent of pressure on Miliband to stand would have been that much stronger.” It seems that even the prime minister, however, had his doubts. “Tony had already decided that Ruth Kelly was more likely to deliver on radical reforms at education than David Miliband, who was thought to be too cautious. He never came up with radical ideas, although he could implement them.”

Another adviser privy to cabinet-making denies that Miliband was badly positioned: “It is not the prime minister’s job to come up with candidates. An environment secretary is as effective as a foreign secretary.”

David Miliband was begged by Blairite sympathisers to stand. He would not. He ruled it out in a New Statesman interview before Christmas, and he ruled it out again in the New Year. He ruled it out every day before breakfast. He got sick of ruling it out. The lobby correspondents concluded he was standing. Go on, his friends said, at least make a pact with Gordon. Demand something for not standing. Instead the affable Miliband even allowed Brown to slap him down when his green ambitions outgrew the Treasury’s book-keeping. Miliband’s television and radio performances became more accomplished. He ruled out standing again. If Labour goes down in flames at the local elections and in Scotland and Wales, he will be told by his “friends” he is running. He won’t. Gordon Brown has spent a lifetime lusting for the top job. “The trouble,” says one of Miliband’s backers inside No 10 ruefully, “is that David just doesn’t want it enough and he’s up against a man who wants this more than anyone has ever wanted anything.”

Blair has a few regrets as he reaches his final curtain.

He knows it is time to go and even believes his departure will have a cleansing effect on the party’s fortunes. “I also believe that the essential Labour position, which is to get over the old divisions of left and right politics and to say you don’t have to choose between a more just society and a more economically efficient one… will hold.”

Sitting in the April sunshine on the little terrace beyond the cabinet room, overlooking a garden filled with toys for Brown’s children, I talk to a powerful Blair loyalist. The occupation of Iraq has been an utter disaster. Even supporters of the war abandon hope as the daily news headlines scream endlessly about mayhem, the slaughter of innocents, the utter waste in human life – “Savagery of the suicide bombers” and, most recently, “200 dead in Iraq’s darkest day”. It goes on and on relentlessly. More British soldiers are dying. The horror is complete: the American surge isn’t halting the violence.

Blair defends his decision to get rid of Saddam Hussein when I challenge him. But his public comments on the bloodshed in Iraq grow infrequent, then vanish. There is nothing more to say.

But Blair claims liberal interventionism abroad as part of his most important legacy. The rescue of Kosovo and Sierra Leone, the ousting of the Taliban in Afghanistan and Saddam, will remain a coherent achievement. “I will be surprised in five years’ time if things aren’t seen differently,” says the Blair loyalist.

Why hadn’t they tried harder in Washington to work on a plan for the occupation? Blair’s man sighs about the US secretary for defence Donald Rumsfeld’s bull-headedness and comes up with a shocking admission: “If the president couldn’t butt his way into that who were we to do it?”

Has the prime minister effectively buried his own foreign policy by entangling himself with Iraq? “No, isolationism does not fit happily with our own history.”

Abroad, Blair’s achievements get greater recognition even when foreign statesmen oppose him. The French presidential candidates invoke his name as an icon of modernisation.

Blair’s friends say that, like Bill Clinton, who left office under a cloud of near-impeachment, Blair will regain the affection of the British people. But Clinton left with his popularity at an all-time high – very unlike Blair.

As for his reputation for domestic reform, he defends his boss against the accusation of squandering money: “Look, there is a perception gap out there. Ask them what their local school is like and they will say, ‘Good.’ Ask them what the education system is like and they will say it is ‘Third World’. No one is prepared to give credit to the government right now. Time will show us in a better light. If people say we are paying doctors and teachers too much, then I say we are proud we pay more. It takes time to reverse years of neglect.

“We have created a new consensus, a new ‘Blairoonism’,” he says with a smile. If Brown won’t join the Blairoons in the middle, the implied threat is that Cameron will capture the castle. And some, just a tiny few, Blairites will be glad to see it happen. But the man himself is in a dilemma. He is flattered by Cameron’s imitation but thinks it is a lite version without substance. Blair is not and never was a Tory, despite what his sneering left-wing critics say. He happens to believe the middle ground is the electoral future. It is just that he distrusts Brown’s centrist credentials.

So if Labour goes down to defeat at the next election, Blair knows he will be blamed: for Iraq, for his spin, for his unpopularity, which at least one leading Labour critic believes has left the party “on its knees”.

But, as his aide said, there are four or five Tonys. Only a couple of them will cheer the day that Gordon walks into No 10.

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