In a speech on economic policy in London this morning, the Barnsley MP dismissed the ‘false choice’ between condemning the legacy of Tony Blair and Gordon Brown and endorsing it in full.
The intervention comes amid mounting speculation that there could be a challenge to Jeremy Corbyn this summer - especially if May’s elections suggest Labour is failing to make headway against the Tories.
Mr Jarvis, a former soldier, is regarded as one of the most likely candidates and is believed to have been raising funds.
In his speech to an audience at think-tank Demos, Mr Jarvis said Labour did not do enough in government to address fears about large-scale migration and tackle inequality.
He said: “Let’s be frank - New Labour’s approach wasn’t enough. It didn’t get at the root causes.
“New Labour didn’t see with sufficient clarity the downsides of globalisation. They knew it meant cheap consumer goods. But they didn’t recognise that too often it meant cheap labour too.”
But he urged the party not to abandon its record in Government altogether.
“It’s a false choice to say we must either champion Labour’s record in government or denounce it. The truth is we should defend our achievements and learn from our mistakes. To anyone outside Westminster, that’s common sense,” he said.
Highlighting the economic divide between the North and the South, Mr Jarvis will point out that the average income in Barnsley is £100 a week less than the average income in Barnes in London.
“I believe this gap matters. It’s bad for our economy. It’s bad for our communities,” he said.
Mr Jarvis ruled out a leadership challenge after Ed Miliband stepped down following the General Election last year.
At the time, Mr Jarvis said it was ‘not the right time’ for his family.