Labour have been forced to shift to the right or they wouldn't have been able to stay in Government

That is a choice, the other obvious one would have been to move to the left and focusing on getting out the vote. If you prioritise staying in power over what you can achieve, triangulation can be a succesful strategy. If you prioritise changes it generally is not.

From the voter perspective, if you vote even though there is no candidate that represents your interests, you show that your vote is for free, the party in question does not have to move one iota to get it. Withholding your vote until you get a good enough candidate is a strategy, albeit a chicken race one. (And in chicken races crashes happen.)

Smaller parties on the side of major parties often play the role of keeping people voting and pulling the agenda. Organisations (churches, unions, etc) play a big role in groups voting as a group and thus being more clear on their demands for voting as well as delivering the votes more effectively. I am under the impression that Thatcher did a lot to kill labor unins?

A vote for PES is a vote for EPP! A vote for EPP is a vote for PES! Support the coalition, vote EPP-PES in 2009!