The former Business Secretary said Mr Miliband had been a "giant political experiment" that had ended up with the voters "ripping stripes off" the shoulders of the party.

He told the Andrew Marr Show that the "awful shocking thing about this election is Labour could have won it."

He said: "The reason we lost it and lost it so badly is in 2010 we discarded New Labour, rather than revitalising it and re-energising it and making it relevant for the new times, the new policy challenges that we faced. That was a terrible mistake." 

He added: "Literally, we were sent out and told to say things and to make an argument – if you can call it an argument – which basically said, we’re for the poor, we hate the rich, ignoring completely the vast swathe of the population who exist in between."

And he lashed out at the undue influence of the trade unions on the party saying they had been guilty of "abuse and inappropriate influence" which led to Mr Miliband's selection as leader.

He added that the party's reliance on trade union funding was "unhealthy".

Lord Mandelson said: "I am not happy with a Labour Party so clearly dependent on people who pay the piper and then in many cases can call the tune.

"That's not a good look, that's not right for a Labour Party appealing for votes in the 21st century."and said the "people who pay the piper and in many cases call the tune. That's not a good look."

He also came close to endorsing shadow business secretary Chuka Umunna as the next leader saying: "He's got a bit of a way to go but he'll get there."

On the same programme, Mr Umunna hinted he would run for the leadership but would not confirm he would be a challenger.

He said: "There isn't even a timetable at the moment but I certainly intend to play the fullest part I can in rebuilding our party in ensuring we have the proper debate that we need on it."

When questioned further on his intentions, the Labour MP for Streatham went on: "Let's be clear you can change the leader but unless we get the message right we're not going to win.

"We can't shy away from some of the arguments we should have had before now."

Speaking on Sky's Murnaghan programme another Labour front-runner Tristram Hunt refused to rule out running for leadership.

Echoing Mr Umunna, he said he wanted to play a full part in Labour's future.

And he said the party's failure had been to reach out to the people in the middle saying the party was on the side of the "under privileged" but "we are also on the side of families who want to shop at John Lewis".

Labour MP and Blairite Pat McFadden said it was not just a new leader the party needed. He said:"What we need is a really deep and fundamental reassessment of our whole approach."

It comes after Tony Blair said Labour must reclaim the political centre ground if the party is to recover from its crushing General Election defeat.

The former prime minister, who led Labour to three consecutive election victories, praised Ed Miliband - who announced his resignation within hours of accepting defeat - for the way he put "his heart and soul into the fight".

But he made clear that a change of direction was needed if the party was to stand a chance of regaining power at the next election.

Writing in the Observer, Mr Blair wrote: "The route to the summit lies through the centre ground. Labour has to be for ambition and aspiration as well as compassion and care.

"'Hard-working families don't just want us to celebrate their hard work; they want to know that by hard work and effort they can do well, rise up, achieve.

"They want to be better off and they need to know we don't just tolerate that; we support it."

Mr Blair's analysis was echoed by potential leadership candidate, shadow health minister Liz Kendall, who said the party had failed to speak to "aspirational middle-class" voters.

Meanwhile Mr Blair's former deputy, John Prescott, blasted the Labour campaign, saying it had been a "bloody disastrous" result for the party.

Writing in the Sunday Mirror, Lord Prescott said: "We fought a presidential-type election based on computers, charts, focus groups and even the American language - Hell yes? Hell no!"

However, he said the real roots of their defeat lay in the failure by Mr Miliband and shadow chancellor Ed Balls to confront effectively Conservative claims that the previous Labour government had "wrecked" the economy.