Two of Labour’s leading organisations on the Blairite wing of the party will be officially dissolved on Sunday in a dramatic move aimed at ending bitter factionalism and reuniting the party around a modern, progressive agenda for winning back power. Progress and Policy Network, both closely linked to New Labour and hugely disliked by the left, will cease to exist and will be relaunched as Progressive Britain – a new platform for debate, political education and policymaking whose founders are determined will be a “big tent” grouping open to all-comers in the party . The move comes after Labour MPs and activists were stunned by their party’s failures in the Hartlepool byelection and many local council elections on 6 May, in which the Tories consolidated gains in so-called “red wall” areas that used to be regarded as Labour heartlands. Wes Streeting, newly promoted to the shadow cabinet in the reshuffle carried out by Keir Starmer in the wake of the results, said the move to set up a new membership organisation was aimed at rescuing the party from crisis by building a desperately needed consensus around ideas and policy that could propel Labour back to power. “Labour has no future if the debate about our direction becomes locked in a battle between two competing visions of the past,” Streeting said. “Progressive Britain will provide a big tent to bring together some of the best thinking from across the left to develop the fresh ideas we need to win support to address the big challenges facing our country and our world. It’s not just a change of direction that Labour needs. It is reinvention.” Streeting will eventually take a leading role in Progressive Britain, although the 38-year-old announced on Friday that he would be stepping back from frontline politics while he had treatment for kidney cancer. Progressive Britain will be launched on Sunday at an online conference, during which Starmer will appear alongside senior Labour figures from all wings of the party. In the aftermath of the 6 May elections, leading voices on the right of Labour blamed Jeremy Corbyn’s leadership. Peter Mandelson, who has served as president of Policy Network, said after the results: “The last 11 general elections read ‘lose, lose, lose, lose, Blair, Blair, Blair, lose, lose, lose, lose’. “We need for once in this party to learn the lessons of those victories as well as those defeats.” But the former shadow home secretary Diane Abbott, a close of ally of Corbyn, responded in a tweet, saying: “Crushing defeat for Labour in Hartlepool. Not possible to blame Jeremy Corbyn for this result.” Patrick Diamond, a former policy adviser to Tony Blair and until now chair of Policy Network, said the time had come to recognise that much of New Labour’s thinking was now outdated and no longer appropriate or relevant to the challenges facing the party. Diamond said: “For the last decade the party’s modernising wing has been frozen in time, bereft of new thinking. Too often party moderates defined themselves by what they are against, the ‘hard’ left, rather than what they are for: the type of society and policies, the new Britain, they want to create.” He added: “We live in an utterly different world from the 1990s. Solutions for then are no longer appropriate for today. New Labour believed voters would never stomach tax rises. Lower taxes became an article of faith. “In the aftermath of Covid the centre-left needs a new approach – raising taxes when it has convinced voters money will be spent wisely on services like social care and the NHS through hypothecation [taxes raised for specific purposes]; levying tax on wealth, assets and capital, so those with the broadest shoulders pay their fair share.” In the aftermath of Brexit there were new international challenges for the left, Diamond said. “Brexit has happened. Labour must accept the result and move on. Yet it has never been more necessary to forge connections with progressive parties across Europe and the US, as President Biden constructs a new social contract for America echoing FDR [President Roosevelt], while social democrats across Europe identify new ways to create high wage, secure jobs and revitalise the welfare state.”