Labour needs to stay where it is - not move to the 'centre'!Tony Blair said recently that Labour need to retake the centre ground. What he means by that isn't really clear, of course, but it can be presumed to mean keeping things as they are on the whole. I imagine he would probably oppose the move to reinstate the 50p rate of tax, cancel the energy price freeze and allow NHS privatization.
However, the moves that Tony Blair would probably support would be suicidal for Labour to implement. The fact is that in recent times, although the average position of the voter has remained about the same, voters on left and right have become more radicalised.
We can see this in the sharp increase of support for the Green Party, the SNP (and, to a lesser extent, Plaid Cymru) [and UKIP] on the left [and right] respectively. In contrast, the Liberal Democrats, who pose as the centrist party, have massively fell in support.
Labour have recognised that, on the whole, even the left are against the unrestricted immigration from the EU and have adjusted their immigration policy to a balanced, sensible one to account for that shift in opinion. However, really, Labour should be seeking to win back the voters moving to the Greens and the left nationalist parties which could lose it the next election.
Back in 2011, people expected Labour to win in 2015 because it would take the votes from the Liberal Democrats, but because it has also lost votes to the left of the party, this no longer seems feasible. Yes, Labour has also lost votes to UKIP, so it should speak its ideas on immigration loud and clear and say why they will work and why UKIP's ones won't to win these voters back. Most people think Labour don't talk about immigration enough at the moment (despite many of Miliband's conference speeches being on the issue) and it should attempt to rectify the issue.
So, Labour's issue is actually not being left-wing enough if anything! Although it should stay where it is to continue attracting disillusioned Liberal Democrat voters. Miliband should do his best to ignore New Labour voices like Blair who are advising for a different era - what works best then won't work best now.