Paddy Ashdown was pledging it, Labour mentioned it before they were elected and then as soon as they were in they dropped the idea all together. I'm with you on that, I've almost given up hope of it happening as it's never in the interest of the party in power to introduce it.
Well the story is that Blair, despite all the positive opinion polls, was still paranoid he may need the Lib Dems support to form a government and Ashdown agreed, with PR being what they wanted to achieve out of it.
When Blair won a landslide, he didn't need the LibDem's help and it was scrapped.
Apparently also according to Ashdown, the parties were going to merge around 1997 too with a LD or two in the cabinet, but Gordon Brown and John Prescott blocked it.