He resigned to spend more time with his family, but yesterday Alan Milburn was enjoying his first day back in the cabinet. Political Editor Chris Lloyd looks at what lies behind the turnaround - and how Mr Milburn could be lining himself up for a tilt at the top job.

IF a week is a long time in politics, then 15 months is an eternity. And so at 8.54am yesterday, hair neatly trimmed ready for the start of the new term, Alan Milburn stepped out of a black, chauffeur-driven Vauxhall and walked across the threshold of 10 Downing Street, and into a Cabinet meeting for the first time in a little more than a year.

It is an extraordinarily rapid turn-around. The Darlington MP resigned as Health Secretary on June 12, 2003, so that he could spend more time with his family. He spent the intervening 15 months telling anyone who would listen how his life was "a million times better".

"This is not a dry run, this is your life," he said, and there was barely a dry eye in the country as his interviews were usually accompanied by a joyful picture of him bathing his kids. "You only get one crack at it and you only get one chance to be there when your kids are growing up."

And then on September 9, 2004, he returned - and not just to any old job. His title is Chancellor of the Duchy of Lancaster, but his brief is to come up with the ideas that will win Labour and Tony Blair a historic third election victory and give them the impetus to thoroughly transform Britain.

Mr Milburn's followers explain the rapid turn-around quite easily. Mr Milburn didn't go seeking the job, they say, Mr Blair came to him - and which loyal back-bencher could refuse his leader's call?

Secondly, they point out, this is not a daily nose-to-the-grindstone job of running a large Government department with weekends spent wading through seas of red ministerial boxes. This is a more cerebral office: sitting in a room thinking great thoughts - and still being home in time for tea.

And finally, this is a short-term contract. Mr Milburn will see it through to the General Election, which is expected in either May or June, and that will be it. Then he will be free to return to his partner and their sons aged seven and 12 - if he so wishes.

There will, of course, be more than a few cynics very quick to suggest that Mr Milburn has already extracted some sort of promise of a position after the election from Mr Blair.

INDEED, the former Health Secretary does appear to be in a powerful position. Mr Blair has been looking increasingly lonely within his own Government. Many of his friends have left - Peter Mandelson, Alastair Campbell and Stephen Byers to name but three - and Chancellor of the Exchequer Gordon Brown has appeared to wield an awful lot of influence over who should replace them.

Having been thwarted in his attempts to rehabilitate Mr Mandelson in July, Mr Blair had to succeed this time in getting Mr Milburn back. Otherwise Mr Brown really would have been in charge of Cabinet appointments - and so Mr Milburn was able to win a job with real power.

Media reports about the reshuffle have regarded it as the latest battle in the ten years' war between Mr Blair and Mr Brown. It is a war that makes as compelling watching as any conflict between two characters in a soap opera: the dour, sullen, sulky squareness of Mr Brown nursing his deep-seated grievance while the grinning flibbertigibbet Mr Blair dances lightly around as if nothing serious is happening.

Mr Milburn's re-emergence does give Mr Brown several headaches. The two men are said not to get along and Mr Brown's sabotage of Mr Milburn's flagship foundation hospitals policy would seem to be testament to that.

Mr Brown will also be worried that, should he succeed Mr Blair halfway through the next Parliament, he will find himself lumbered with a manifesto full of Mr Milburn's New Labour ideas when he would prefer a move towards old Labour certainties.

AND thirdly, should Mr Milburn be successful and deliver a comfortable General Election victory (at this stage, it is impossible to imagine Labour losing the next election and so the only question is the size of victory), he will look increasingly like Mr Blair's natural successor.

In the past, Mr Milburn has been perceived as being "Blair-lite": a man who is a copy of his leader with very little ideological baggage of his own. This was why, despite his ability to work well on radio and television, he has never seriously been regarded as a front-runner in the leadership race. He was too lightweight, too insubstantial to trouble Mr Brown.

But Mr Milburn has spent his 15 months out of the Cabinet not only re-connecting with his family and his constituency, but also re-discovering the reasons why he is in politics.

This has led him to give a series of speeches to thinktanks about where Labour should be heading. At first, these were dismissed as a man seeking to keep his name in the headlines after his resignation, but quickly people started listening to their substance.

His ideas about the need for flexibility in the workplace to help people with their work/life balance were expected from someone in his position, but then came speeches on how to reinvigorate local government, including the eye-raising suggestion that councils (and regional assemblies) should raise 50 per cent of their expenditure rather than rely on central grants.

He has become very interested in devolving decision-making to local people - "when it comes to localism it is time to stop talking the talk and start walking the walk" he said in January.

As well as airy-fairy theories, there have been practical suggestions, mainly driven by the desire of his Darlington constituents to tackle anti-social behaviour ("number one issue on the doorstep", he mutters to all who suggest Iraq will lose the election).

He's suggested National Community Service as part of the curriculum for 13 to 15-year-olds to help voluntary organisations, and new kinds of mortgage to help those who can't afford to make the first gigantic step on the home-ownership ladder.

These weren't disparate thoughts, but part of a strategy. "They are about empowering people so that they are fully part of their community, otherwise society will disintegrate, " he said in November. "Some of the old ties - churches, trades unions, male apprenticeships, even families - are disintegrating, so there is a whole new agenda about citizenship that Labour will have to open up for the future."

CENTRAL to that strategy was New Labour, and although the party itself has been keen to distance itself from the silly "new" tag, to Mr Milburn it is the "new" that makes the party so vital and relevant.

In an interview with The Northern Echo a year ago, he even defined why New Labour wasn't a passing gimmick but a set of real beliefs with a future. He said: "There are two strands of thought about New Labour. For some, it was purely the midpoint between the Thatcher right and the old left, it was just split the difference.

"That's not what it is for me or for Tony: it is how you transcribe Labour values of fairness and opportunity for all into a modern world which is different in every way.

"Twenty years ago, never mind 50, there wasn't an issue about two income households with both people working because fewer women worked, but now they make up half the labour force. That places new pressures on home life and if politicians distance themselves from that agenda, politics becomes irrelevant."

It is now his job to prove that this set of beliefs has a future by writing them into a manifesto that wins Mr Blair a sizeable third victory. Such a victory would put Mr Milburn on the brink of No 10 himself - should there be enough room inside for his family, of course.