A senior government adviser on anti-social behaviour has joked about working while drunk and said anti-binge drinking messages were "nonsense".
Louise Casey, 38, head of the Home Office anti-social behaviour unit, made the remarks in an after-dinner speech, which was secretly recorded by a guest.
She also poked fun at Home Secretary Charles Clarke in the speech to chief constables and senior civil servants.
A Downing Street spokesman said Tony Blair retained full confidence in her.
Speaking in Stratford-upon-Avon, Ms Casey told her audience: "I suppose you can't binge drink anymore because lots of people have said you can't do it. I don't know who bloody made that up, it's nonsense."
On the tape, obtained by BBC News, she said some ministers might perform better if they "turn up in the morning pissed".
"Doing things sober is no way to get things done," she added.
But her strongest criticism was reserved for Downing Street, which she suggested was "obsessed" with conducting extensive research before formulating policies.
She apparently joked that she would "deck" Downing Street policy advisers if they kept spouting jargon at her.
At the weekend reports claimed Tony Blair had criticised Home Secretary Charles Clarke over a lack of action on the "respect agenda".
However, Downing Street insisted it was "absurd" to suggest Mr Blair was unhappy with Mr Clarke's handling of the issue.
Ms Casey made her comments at a conference attended by senior civil servants, chief constables and criminal justice practitioners last month.
Although her tone was light-hearted - she said the tea lady was more powerful than ministers - a number of people in the audience are reported to have walked out during her speech.
BBC home affairs correspondent Danny Shaw says the remarks are likely to cause both Ms Casey and the government "deep embarrassment".
The prime minister's official spokesman said Mr Blair had "full confidence" in her and his "high regard for her was well known because of her record of achievements in the past".
But the spokesman said: "The remarks were made after a dinner and should be put into some sort of perspective.
"Lots of people have said things after dinner and when they see them in the cold light of day would regret them and no doubt she would not have wished to see them in this morning's newspapers."
A Home Office spokesman said Ms Casey was achieving a great deal in leading the campaign to tackle anti-social behaviour.
"But, like all Home Office employees, she is subject to the Civil Service Code. We are looking into her reported remarks," he added.
Harry Fletcher, assistant general secretary of the National Association of Probation Officers, said Ms Casey's remarks were "extraordinary".
They were "certainly inappropriate comments to be made by a civil servant, never mind one who is heading up the anti-social behaviour unit," he told BBC Radio 4's Today programme.
"It was an attempt at humour and you could hear on the tape some of the audience were laughing.
"It's worrying that these comments are made by a person who's heading up an extremely important initiative which is being headed up both by the Home Office and Number 10.
"It won't do anything to ease the tension - if there are any tensions - between the leading figures."
Shadow home secretary David Davis said it was "ironic" that the official appointed to report to Tony Blair on anti-social behaviour appeared to be "an advocate of binge drinking".
"Maybe this explains why alcohol-related violent attacks are up 25% and why Labour are so keen to unleash 24-hour drinking," he added.
Ms Casey was appointed as director of the unit by Tony Blair and was last month told to report directly to the prime minister on the issue of restoring "respect" to Britain's streets.
She is responsible for encouraging the use of anti-social behaviour orders by police and local authorities clamping down on loutish behaviour.
One of the top priorities of Mr Blair's "respect" agenda is to reverse the tide of drunken violence blamed on binge drinkers in Britain's city centres.