Hazel Blears said she did not underestimate Mr Cameron

She told a London conference, organised by left-wing think-tank Compass, that many rank-and-file were discontent with the leadership.

She also warned Labour supporters the party could not afford to underestimate Tory leader David Cameron.

Treasury minister Ed Balls said governing was getting "more difficult" for Labour.

'Same old Conservatism'

Ms Blears said she was going to "look really seriously" at giving members a greater sense of engagement.

"It's going to be part of my job ... to see if there is a way of giving members a genuine sense that they are influencing party policy."

Ms Blears added that she did not believe Mr Cameron's leadership was leading to as big a change in the Conservative Party as some people thought.

"I think you will really begin to see, he may well look different, be different but I don't think he's taken the vast majority of his party there, and I think we'll see some of that right-wing agenda begin to emerge."

Union leader Derek Simpson issued a stark warning

But she added: "I don't underestimate him, by the way, I think he is attractive in many ways to people."

Mr Balls - a long-time ally of the Chancellor, Gordon Brown - said: "We have raised expectations, and not always met them."

Amicus union leader Derek Simpson said Labour was set for a general election defeat if it did not change direction.

Ministers, trade unionists and campaign leaders also addressed the conference.

Mr Balls also accused Conservative leader David Cameron of hypocrisy.

"What we are hearing is the same old conservatism that prefers a minimal state and cuts in investment and leaves the poorest and the weakest in our society dependent on charity," he said.

'Serious problem'

Mr Simpson, whose union represents workers in the manufacturing sector, was applauded by the conference when he said: "An absolute undeniable certainty and truth is that we need a Labour government at the next General Election."

He added: "What's almost certain, unless we change direction, we won't have one."

Ed Balls says running the country is becoming a more difficult task

Former Labour minister Michael Meacher told BBC News 24 it was time for Mr Blair to leave but denied he would become "stalking horse" if Mr Blair refused to stand down.

"I entirely support the view of party members, that he shouldn't be forced out, but he should note the view of party members that he should go earlier than later - that is perfectly clear.

"But I am certainly not in the contest for being a stalking horse. I never have been," he said.

Earlier, he had presented a poll suggesting 71% of current and former Labour members want Tony Blair to step down as prime minister before autumn 2007.

Mr Meacher said the YouGov poll results demonstrate that Labour members feel ignored by the leadership.

"We have lost half of our members and four million voters since 1997. This is a very serious problem."

YouGov questioned 670 Labour party members and 704 lapsed members online between 1 June and 6 June.

Compass is headed by former adviser to Gordon Brown, Neal Lawson, and recently pressed for a timetable for Mr Blair's departure from Downing Street.

That prompted cabinet minister John Reid to call Compass an "old Labour lobby group" while Mr Blair said its policies were the surest route to opposition.