British and US forces will hand over control to Iraqi authorities
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Tony Blair and President Bush are speeding up plans to withdraw troops from Iraq and hand over security roles to the Iraqis, government sources say.
The reports come as Education Secretary Charles Clarke sought to play down speculation about Mr Blair's future.
The Daily Telegraph quotes Mr Blair's spokesman as saying greater urgency would be attached to forming effective Iraqi security forces.
Mr Clarke says Mr Blair "absolutely believes...he should stay" as PM.
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He absolutely believes, not only that he should stay, but more over, that he has a major role to play in leading the party in the country for the foreseeable future
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UK forces are still expected to stay in Iraq until at least 2006.
But Downing Street says Mr Blair wants to see "indivisible sovereignty" in Iraq - which means control of security as well the country's jails.
The plan is expected to help Britain disengage sooner rather than later as Iraqi security forces are trained and deployed.
'Tragic circumstances'
It comes as Abdel-Zahraa Othman, also known as Ezzedine Salim, the head of Iraqi Governing Council, was killed on Monday in a car bombing near a US checkpoint in central Baghdad.
Foreign Secretary Jack Straw said: "What this shows is the terrorists and insurgents in Iraq are trying to disrupt the peaceful transfer of power from the occupiers to the Iraqi people and that these are enemies of Iraqi people themselves."
Liberal Democrat foreign affairs spokesman Sir Menzies Campbell said the
assassination was a "serious blow" to political progress in Iraq that must not be allowed to obstruct the hand-over of power to an Iraqi government on 30 June.
Mr Clarke conceded that it was another of the kind of "very tragic circumstances" which leads people "to worry about how we are going to get to the end" of the situation in Iraq.
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I think he is the best prospect for our party and the country at the next general election
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He dismissed comments about Mr Blair's future as "a fantastic load of fluff", created by the "usual suspects from the parliamentary Labour party".
Mr Clarke said he had reached that conclusion after discussing Mr Blair's job prospects with him last week.
Speculation had been fuelled by Deputy Prime Minister John Prescott, who told The Times that ministers were "positioning" themselves for when Mr Blair stepped down.
'Outstanding' prime minister
But Mr Clarke said he did not "recognise the description that he [Mr Prescott) is reported to have given".
"I don't believe there is some kind of movement of the tectonic plates taking place. I don't believe, in the Cabinet or elsewhere, there are people preparing themselves for some new situation," he told BBC Radio 4's Today programme.
Mr Blair "is an outstanding prime minister and I think he will be an outstanding prime minister for a very considerable time to come", he said.
"He is by a mile the best candidate to lead us into the next election to take us through the next Parliament ...
"He has that combination of personal qualities."
Lib Dem debate
Mr Clarke continued: "If Tony were thinking of going, which I absolutely don't think he is .... I discussed it with him last week.
"He absolutely believes, not only that he should stay, but more over, that he has a major role to play in leading the party in the country for the foreseeable future.
"I think that's his intention and I believe very strongly he will be very widely supported in that intention.
"I'm absolutely certain he wants to stay. I think he should stay ... I think he is the best prospect for our party and the country at the next general election."
The Liberal Democrats have called a Commons debate on Iraq on Monday, focusing on the continued involvement of British troops there.
Meanwhile, South Korea's foreign ministry, claims the US has informed Seoul that it plans to redeploy a contingent of American troops from South Korea to Iraq.