With a POD at any time after Tony Blair was elected Labour leader in 1994, how can he win a landslide similar to OTL's 418 in 1997 but then suffer a humiliating setback to somewhere around 310-330 seats, facing a strong Conservative bounce-back in 2001 (or thereabouts, I know the 2001 election was called OTL because Labour were soaring in the polls, maybe it happens a bit later or earlier TTL). This doesn't mean Labour loses power completely, but simply hold on very shakily in either minority government or something very close to it.
Bonus points if William Hague is still leading the Conservatives in 2001 and things have gone more-or-less OTL until the latter half of Blair's first term (I have a feeling this might be pretty much impossible though).

Also, any ideas as to what the results of such a shock reversal of fortunes might be? Could Blair ironically end up with a better reputation if he gets booted out relatively soon after this and hence avoids the Iraq debacle? Would the Conservative Party perhaps stick closer to its 90s/early 2000s right-wing orthodoxy with a quick return to form against New Labour?
 
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Perhaps Blair is hit rather harder by the electorate because of his Europhilia. I think in OTL, the Conservatives were gaining ground against Labour during the Keep the Pound Campaign against Blair's insistence on adopting the Euro. This may make it possible for a reduced majority in 2001. Higher voter turnout may also benefit the Tories. The 2001 election was notorious for the apathy displayed by the electorate and voter turnout falling by almost 12% since 1997. A lot these voters were probably disgruntled Conservative supporters who voted for Major and didn't bother the next time around. If you get turnout higher then there's a real chance of a reduced Labour majority.

In this case I certainly think that a declaration of war on Iraq would boost Blair's numbers. When the war was called it was actually quite popular with the British public, the majority of whom supported it. It may even save Blair in the same way that the Falklands War saved Thatcher.
 
The Tories really were ripping themselves apart from the end of Thatcher up until Cameron, and 2001 was a particularly bad time for them on this front. The Portillo/Maude camp were undermining the campaign from the start and had done the party no favors during the conference period in the previous year.

I don't see how the Conservatives have any kind of meaningful bounceback until they resolve their internal issues that depressed turnout so much. William Hague was the wrong man for the job on this, however.

I think the best way for Labour to get a bloody nose in that point in time is for the Lib Dems to steal some of their appeal to professionals and the middle class in the South of England and win enough seats to knock them under, say, 370, or 350 if the Tories have a really bad showing. The Lib Dems need a wedge issue for this to happen, however. In 2005 they had Iraq. In 2001, perhaps it could be something like the Euroskeptic Socialist wing of Labour causing a lot of problems inside the party and allowing the Lib Dems to let their Euro flag fly.
 
The best answer I can come up with is Blair decides to call a referendum or an election on the issue of the Euro. I'm not sure how likely that was in this time period though. You'd need to get rid of Brown or considerably weaken his influence to make it happen.

I think the best way for Labour to get a bloody nose in that point in time is for the Lib Dems to steal some of their appeal to professionals and the middle class in the South of England and win enough seats to knock them under, say, 370, or 350 if the Tories have a really bad showing. The Lib Dems need a wedge issue for this to happen, however. In 2005 they had Iraq. In 2001, perhaps it could be something like the Euroskeptic Socialist wing of Labour causing a lot of problems inside the party and allowing the Lib Dems to let their Euro flag fly.
The internal debate within Labour about the EU mainly centred on the Euro at this stage, which the overwhelming majority of people were against. Even those who were for it were unlikely to change their vote over it. The EU wasn't nearly as big an issue among the electorate back then as it is now, especially Remainers.

With Blair as leader, I think you probably need the Lib Dems to find a wedge issue on which they are to the left of Labour if they want to make significant inroads.
 
The Conservatives did hold a brief lead in 2000 as a result of anger with Blair over rising fuel prices, which was eventually brought to a close when the government agreed to impose a freeze on fuel duties. So, if we are to turn 2001 into a repeat of 1950, then this offers our best shot - so first have Labour refuse to lower fuel duties (perhaps rub salt into the wound by having Brown rise duties further in the March 2001 budget), which should keep polls competitive between the Tories and Labour, then, if Blair calls an election for May 2001 (which he certainly might, believing that the electorate won't re-elect the Conservatives after having only been in opposition for four years), have a series of scandals emerge mid-campaign which does significant damage to the government. Perhaps delay the uncovering of the Ecclestone affair until 2001 and have an early Cash for Honours scandal - this should call Blair's integrity into question and also lead to many Labour voters switching to the Lib Dems out of disgust.

With all those factors in play, this alternate 2001 result would probably be something like this (made with Electoral Calculus):

Labour: 333 (-85)
Conservative: 240 (+75)
Liberal Democrat: 57 (+11)
(Note that the Conservatives win a plurality of the popular vote in this scenario)

Such a result would leave Blair significantly damaged, with Brown sharpening his sword, while Hague's leadership would appear stronger than ever. Such a Parliament probably wouldn't last the full five years, either - if Brown removes Blair, he'd probably call a snap election to gain a mandate, while, if Blair holds on, then his majority could easily be whittled away through by-elections, and if Iraq occurs on queue, then it could very well be the death knell for Labour.
 
There is always the possibility that the Kosovo War turns into some kind hot political mess, for example RAF bombing a hospital by mistake.
 
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