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Guido was surprised that a letter from Sir John Rose, CEO of Rolls Royce in this morning’s FT hasn’t got more traction:

“To draw an analogy, if the UK was a business, the shareholders would be asking serious questions. The current model appears to be that we can grow our business by growing overhead, by applying better terms and conditions to support functions than to wealth creators, and by paying dividends out of borrowings not all of which are recognised on the balance sheet.

We are also asked to believe that service levels will inevitably suffer if the costs of delivery are reduced. This need not be the case. As any business will confirm, service levels will reflect prioritisation, proper definition of desired outcomes, concentration on reducing waste and investment in productivity.”

Rose is a member of Brown’s special Business Council which is meant to have the ear of the PM. Brown clearly isn’t listening though…

Given the profound effect ninety minutes of television has had on the fickle electorate, it will be worth keeping an eye on the other debates happening in the run up to polling day.

The Daily Politics have organised almost all of the contenders for the senior cabinet positions to have a grilling from Andrew Neil. Today sees the first of such battles between William Hague, David Miliband and Ed Davey. The Beeb’s specialist reporter in each field will also be taking part in the interrogation.

If you want to put your money where your mouth is, Smarkets punters right now reckon Hague is still favourite to be the next foreign secretary and Ed Davey has only a 12% chance of getting the job. The fun and games begin this afternoon on BBC Two at 14.15. Miliband has been on fighting form butting the boot into the Tories since the campaign began, though anyone should be wary of entering the ring with Hague. Especially Davey who is notoriously dull on camera…

Word reaches Guido that the Darlings have emptied their Number 11 flat. All their bookshelves have been boxed up and are ready to go. They are clearly not planning on coming back to Downing Street again.

You can bet on who will replace him as Chancellor here.

Bell Pottinger’s Peter Bingle has let rip in another one of his helpful memos reproduced here in full:

I said a prayer last night to St Jude the patron saint of hopeless cases but I doubt that even he will know what to do about the Tory Party campaign.

Something is happening with the electorate. Today’s YouGov poll showing the Lib Dems in the lead is astonishing. Perhaps the public anger with MPs over their expenses and the banking crisis will result in the body politic being smashed to bits. What was true on Friday may not be true any longer.

The stakes are now very high. If David Cameron does not become PM on 6/7th May the electoral system will be changed. The first past the post system will be abolished and there will not be a Tory government for a very long time if ever again. Perhaps John Major will go down in history as the last Tory PM.

This is the most inept Tory campaign in living memory. I know there have been some dud campaigns in the past. William Hague’s was pretty awful but in a way it didn’t really matter. Nobody believed he was going to win the election. This time all the Tory Party had to do was to ask the electorate a very simple question: “Do you want five more years of Gordon Brown?” The answer would be no. The election campaign strategy was therefore all about giving the electorate the reasons for voting against the PM. The M&C Saatchi adverts were a good start.

As I have mused before the Tory opinion poll lead was always based on the public’s loathing of the PM rather than any real affection for David Cameron. The election campaign should therefore have been negative in tone and focused entirely on the PM’s failings. Whatever the focus groups may say negative campaigning works.

There doesn’t appear to be any strategy. The ‘big society’ idea has come and now disappeared. The most popular Tory politician Ken Clarke has become the invisible man. He may be campaigning in marginal seats but he should be on our TV screens every morning, noon and night. And then there is the policy that dares not speak its name. Immigration. Every canvasser I have spoken to from every party has told me that the issue that keeps coming up on the doorstep is immigration. This is a Tory issue and yet I am told that there will only be one day when it is raised. What is going on?

The decision to agree to the televised debates may well have cost the Tory Party the election. It has elevated Nick Clegg from nowhere to equal footing with the PM and David Cameron. Whichever adviser or guru advised David Cameron to take part made a terrible mistake.

So is the election campaign lost for the Tory Party? I don’t think it is. Nick Clegg’s policy agenda is very attackable. As Alan Johnson put it in Saturday’s Times: “The Lib Dems are soft on crime, inept on asylum and bloody dangerous on national security.” How Labour candidates must wish he was the PM …

The Tory Party needs to mobilise its key assets such as Ken Clarke and talk about Tory issues such as low tax, immigration and Europe. It needs to connect with Tory voters and indeed anybody who doesn’t want Gordon Brown for another five years. Thatcher’s great strength was her ability to connect with ordinary voters, particularly those who wanted to better themselves. Politics is all about helping people to realise their dreams. We seem to have forgotten this.

Winning the election didn’t seem that difficult a task until the televised debate which should never have happened. Even now there is a simple message. Only a vote for the Tory Party will prevent Gordon Brown being PM for the next five years. Nick Clegg is never going to become PM but he could help Gordon Brown stay PM. This is all very reminiscent (in reverse) of the US presidential election when Ross Perot enabled Bill Clinton to beat George Bush.

I attended a lunch on Saturday at which many Tories were present. The conversation inevitably focussed on the election. There was a mixture of gallows humour and real concern. Nobody could understand why with the most unpopular PM ever and an economy on its back the Tory Party is polling at the same level as Michael Howard when he lost in 2005. The only solution was to have another glass of wine.

Perhaps this is all some terrible nightmare and I will awake to discover that I have missed the real campaign and that David Cameron is PM with a majority of 52.

Is the game up for the Tory Party? What does the Tory Party need to do to regain the political initiative? Will the Nick Clegg bubble burst?

Guido is sure all his advice was most appreciated in CCHQ this morning…

The YouGov daily poll this morning has the Lib Dems on 33%, the Tories on 32% and Labour on 26%.  The Guy News rolling poll of polls above is also reflecting the dramatic rise of the LibDems, if they hold their gains after Thursday’s debate it will confirm that this is no mere bubble. The same YouGov poll asked a number of policy questions including this one on the LibDem’s populist winning-on-the-doorstep tax policy:

Here are some proposals that have been made in the current election. In each case, do you support or oppose it?

Tax: Scrap income tax on earnings of less than £10,000 a year. The £17billion cost of this will be paid for by a tax on bigger houses, a tax on airline flights, restricting tax relief on pensions savings for higher-rate taxpayers, and attempting to clamp down on tax avoidance.

• Support: 66%
• Oppose: 20%
• Don’t know: 14%

Danny Finkelstein and Guido had a bit of Twitter spat about this last night. Guido holds Fink responsible for accepting the Balls/Brown dividing lines and helping to foist on the Tories their “no tax cuts” position.  A policy position that Guido sees as cowardice in the face of the enemy. Relying on the momentum for “change” and making the election a referendum on Gordon left one huge exposed flank – they had forgotten the other “change” candidate and they have now been outflanked not just on change but also on what was once their politically Unique Selling Point – tax cuts.  Don’t say Guido hasn’t warned Fink publicly and repeatedly, as far back as November 2008, that what he advocated allowed the Tories to be outflanked. Clegg himself even told Fink that he was wrong saying “I’m not sure I’ve ever been called a “punk tax cutter” before. I quite like the label… Danny Finklestein is wrong, and cutting taxes is right… Growth is what we need now.” Fink still hasn’t justified his ridiculous over the top claim that the economy would be destabilised by tax cuts with a single historical example of this ever happening.

More real-time polling from Google trends shows what people are searching for online, it suggests people want to know more Nick Clegg:

On the weekend a disappointed Tory insider told Guido they had searched through Clegg’s expense claims from his days as an MEP –  “He wasn’t on the take.”  Instead they are going to attack Clegg for being a former lobbyist – is that really wise when they are also led by a former lobbyist?