By Phil Hazlewood

LONDON (AFP) - British Prime Minister Gordon Brown is battling to steady his Labour Party's nerves after its worst election defeat for 40 years, but the rout raises serious questions about his future, commentators say.

The British prime minister was left reeling by local polls that saw the main opposition Conservative Party surge back into town halls in England and Wales and even oust eight-year London mayor Ken Livingstone from office.

But while nobody expects Brown to go anytime soon, some see the May 1 polls -- 11 years to the day after Tony Blair led Labour into power -- as presaging the beginning of the end for the party's hold on national power.

"Just as the local elections of 1995 marked the draining of (then premier) John Major's authority, so those of 2008 announce the sands are running out for Brown," said Martin Kettle of the normally sympathetic Guardian daily.

Brown has described the results as "bad" and "disappointing" -- an understatement to many -- while Cabinet colleagues have accepted the government has been given a bloody nose.

One rank-and-file Labour member of parliament even said Brown had been put on six months' notice to reverse the slump. Others admit there has been talk of a leadership challenge, although party insiders dismiss this as unlikely.

The most talked-about possible successor, Foreign Secretary David Miliband, has made clear he remains utterly loyal to Brown, and in any case at 42 is widely considered not experienced enough.

The question now, though, is whether Brown's government -- still barely 12 months old -- is so irreperably damaged that Labour will fail to secure a fourth, straight term of office at the next general election.

Notwithstanding the results -- which saw Labour limp in third with just 24 percent of the national equivalent vote, a full 20 points behind the Tories -- and the negative headlines, Brown still has time on his side, say some.

A general election does not have to be called until mid-2010 at the latest.

And while newspaper editorials Saturday all recognised that he failed his first major electoral test since taking over from Tony Blair and sensed a Tory resurgence, Brown still has the benefit of the doubt.

Significantly, the mass-selling newspapers The Daily Mail and The Sun, perceived by politicians to have the greatest influence in shaping British public opinion, remain "on-side".

The next few weeks could determine how long Brown is given such leeway.

New legislative proposals due in the coming weeks are being billed as the start of a relaunch, although truth told, the man once called "the big clunking fist" has already had more fightbacks in 10 months than an ageing boxer.

A May 22 by-election in northwest England, called after the death of the incumbent Labour representative, will be watched closely for further signs that voters are now abandoning the government after 11 years.

The government's controversial plans to extend the custody time limits for suspected extremists to 42 days are to be put to a parliamentary vote, with predictions of a sizeable rebellion.

At the same time, the former finance minister faces circumstances out of his control -- the global economic downturn and its implications for British house prices, a fall in which has turned voters against a government in the past.

Brown will mark -- perhaps not celebrate given recent events -- one year in office on June 27, doubtless among lengthy assessments of his record.

Justice Secretary Jack Straw, a key Brown ally, was bullish Saturday, saying Brown had plenty of time to revive his party's fortunes. "The situation in two years' time will be different from where we are today," he told BBC radio.

But some traditional Labour stalwarts already do not share his optimism.

The chief executive of Labour's most eminient think-tank, the Fabian Society, warned on the eve of polling last week that Brown "risks being written off" before his first anniversary by failing to communicate his message.

Labour backbencher Graham Stringer said ministers were privately discussing a possible challenge to Brown.

"There is no real tradition of regicide," he told Sky News television. "But it would not be true to say that these conversations aren't going on between ministers and Labour backbenchers, about whether there should be a challenge.

"Those conversations are being had. There is a public display of loyalty and there is private despair."

Jonathan Friedland of the Guardian, long known for its close ties with Labour, added: "After an era of dominance that has endured since the mid-1990s, Labour is about to enter the twilight.

"It threatens to be a slow death."