CLOSE-UP: Newsmaker/Douglas Alexander - Labour's rising star is ready to fight COI's corner

Douglas Alexander seems prepared to listen to both sides of the DoT/COI story.

COI Communications has had a fluctuating relationship with its government ministers and several have come and gone in recent years. But it has now won an important ally at the heart of the New Labour project in Douglas Alexander, the Cabinet Office minister responsible for COI.

Although the Government has sometimes doubted whether to retain a centralised advertising body, Alexander wants COI to have an enhanced role after a wide-ranging review of Whitehall's communications reports this autumn. He would also like the Department of Transport, which broke away from COI last year, to return to the fold to maximise COI's buying power.

Alexander, 35, is one of Labour's fastest-rising stars. A protege of Gordon Brown, and like him a son of the manse, he seems destined to reach the top. After a spell as Brown's Commons researcher, he worked as solicitor before becoming MP for Paisley South in a 1997 by-election.

Unusually, he by-passed the bottom rung of the ministerial ladder, winning a fast-track promotion to minister of state for e-commerce in 2001, before moving to the Cabinet Office last summer.

He arrived just as Carol Fisher was departing as COI's chief executive, though she still had time to tell him it was doing a good job. The split with the DoT, partly responsible for Fisher's departure, gave him an early dilemma. He rejected pressure from COI to stop the breakaway, since Whitehall departments are allowed to go it alone.

Alexander approved the appointment of Alan Bishop as Fisher's successor, seeing the move as a change of gear and style. The bombastic Fisher had shaken up COI with a dose of private-sector medicine; Alexander saw the former Saatchi & Saatchi executive as the experienced adman to take the organisation forward.

The minister caused a flutter when he included COI in the government communications review chaired by Bob Phillis, the chief executive of the Guardian Media Group. On the face of it, COI's inclusion was a setback, coming less than a year after it had won a government seal of approval in its own five-yearly review.

Now Alexander is happy to make clear that COI has nothing to fear from the Phillis inquiry. In fact, it could be an opportunity. "There is no hidden agenda as far as COI is concerned," he says. "It is not a review of COI specifically.

"COI will advise the committee, but it is looking at the whole broad remit of how we communicate."

He goes on: "I think COI will endure because of the quality and strength of the work it is doing. Best practice can be shared much more easily with COI there. One of the things we are working towards is joined-up government and avoiding departmentalitis. Good planning, spreading best practice and securing the economies of scale, are all arguments for COI." So could COI have an enhanced role after the review? "Yes," Alexander says, while insisting he does not want to prejudge the independent review.

COI's trump card has always been the discounts it wins by pooling the Government's buying power. Yet isn't that undermined by the DoT's decision to take its £12 million-a-year advertising budget out of the central pot, even though COI agencies are on its own roster?

Alexander chooses his words carefully on the sensitive issue, insisting that the outcome will depend on the study of the DoT's experiment by the Advisory Committee on Advertising. But his sympathies appear to lie with COI. "I am happy to have a dialogue with the DoT, but I want to be clear about the basis on which the discussion is taking place. What I say is: bring me the evidence," he says.

"We don't know how the figures stack up at this stage. It is bound to be the case that the Government is strengthened by being able to speak with one voice in terms of purchasing negotiations. We have been looking for an evidence base for that assertion."

Bishop has called a truce with Charles Skinner, the DoT communications director, who fought a turf war with Fisher. Alexander says: "I think that in the discussions that take place from now on, we should be able to say here is the evidence in terms of the collective buying power of the Government. I think there will be an opportunity for a constructive dialogue between Alan and Charles."

The minister believes some tension between COI and departments is inevitable.

"You have to recognise the reality of where the budgets lie - in departments. In many instances, the scale of spending on advertising has increased over a long period so departments have expertise and knowledge on advertising. On the other hand, that strengthens the case for asking how we can share our expertise and if there ways we can align what we are doing so we can bring better dividends for the individual departments."

As a highly political animal, Alexander wastes no time in dismissing Tory and Liberal Democrat claims that Labour has politicised the Whitehall ad budget by taking spending to record levels particularly in the immediate run-up to the 2001 general election.

He insists that spending levels were the same after the election as before.

"A lot of the arguments about politicisation of advertising are simply wrong. By definition, when a campaign reaches COI it is established government policy. There is probably not a larger or more complex organisation than the Government in the country. It needs to have effective communications on issues that matter."

Alexander does not interfere in COI's work on a day-to-day basis; as an arm's-length executive agency, it is supposed to be free of the constraints under which Whitehall departments operate. But he does have a genuine interest in communications and acted as Labour's campaign co-ordinator at the 2001 election, based at the party's then Millbank headquarters. Some of the challenges facing the political parties also face the Government, he says.

"Areas where there is room for further development include market segmentation - targeting different audiences - and direct marketing, which any large organisation should be looking at," Alexander says. He is pleased that Bishop intends not to rely on traditional approaches, such as TV, and also that Bishop is looking to apply lessons from his work in America on targeting ethnic minorities. "He brings experience and a wider perspective. There is scope for us to come forward with some fresh ideas and innovation," he says.

Similarly, Alexander believes Labour must move further away from "one-size-fits-all" campaigns to reach an increasingly diverse electorate.

He is anxious for Labour to avoid the fate of other centre-left governments in Europe. "Although being in office should not stop us from campaigning, all too often it does," he says.

Alexander is bound to play a key campaigning role for Labour at the next election. He will have moved on from COI by then, and could win promotion soon in Tony Blair's next reshuffle. But COI will still have an influential friend at New Labour's court.