UK's Brown safe for now -- focus on economy, Cameron

By Jodie Ginsberg - Analysis

LONDON (Reuters) - Britain's Gordon Brown is under no immediate pressure from his party to step aside after a drubbing in local elections, although Labour risks being ousted from government if the economy does not pick up.

Analysts also said the Conservative success in the elections would put the opposition party and their leader David Cameron under renewed pressure to prove they can lead the country after more than a decade in the wilderness.

So far, senior Labour lawmakers have rallied behind Prime Minister Brown, saying the former finance minister is the man to lead Britain through an economic downturn -- but voters are unconvinced.

With two years to go before national elections, Labour recorded its worst results in 40 years in local polls on Thursday, with estimates putting the party on 24 percent of the vote -- in third place behind the Conservatives on 44 percent and Liberal Democrats on 25.

Tony Lloyd, chair of the parliamentary Labour party, insisted there were no moves to oust Brown, who has been in the job for less than a year after taking over from Tony Blair.

"I don't think there's appetite for saying we get the knives out," he told Reuters in a telephone interview.

"Scots in leadership positions can surprise you," he said, pointing to the success of Alex Ferguson, manager of Manchester United football club, who is a Scot like Brown.

Still smarting from a bitter leadership battle between Brown and his predecessor Tony Blair, the Labour Party recognizes that more in-fighting now would be fatal -- and there is no obvious candidate to fill Brown's shoes.

Possible contenders include Foreign Secretary David Miliband and Education Secretary Ed Balls, but neither of Labour's rising stars yet have a high profile -- and may not be keen on what could be a poisoned chalice if economic jitters persist.

Rising food and fuel costs, a fall in house prices in a country where two-thirds of the population own their own home, and a tax move by Brown that left five million of Britain's poorest households worse off have all soured the public mood.

"These are disappointing results and we recognize the difficult economic context with people feeling the pinch," said Labour deputy leader Harriet Harman.

But she threw her support behind Brown: "Against the backdrop of economic concerns, really there is nobody with more experience and more commitment to take the country through."

CONSERVATIVE CHALLENGE

Pressure will mount on Brown, however, if cannot convince voters he is doing his utmost to help those made worse off by a decision to abolish the lowest rate of tax, or if the economy takes a turn for the worse.

"If the economic crisis continues through 2010, Brown's dead in the water," said Robert Worcester, founder of pollsters MORI.