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Her defence of the former Chilean dictator at a fringe meeting at the Conservative Party conference was every bit as strong as expected, but although Lady Thatcher was greeted with an ovation her reception was more muted than many had expected.

She told Tories in Blackpool it was vital for the party to fight the government on this case.

"We must pay heed to the implications of an international lynch law, which under the guise of defending human rights now threatens to subvert British justice and the rights of sovereign nations."

Lady Thatcher said General Pinochet himself admitted abuses had occurred during and after his military coup to oust President Salvador Allende.

"But it is an affront to common sense as well as a caricature of justice to maintain that a head of government must automatically accept criminal responsibility for everything that is done while he is in power.

Lady Thatcher received a standing ovation before she started to speak

"On that basis Messrs Blair and Straw should accept criminal responsibility for everything done in every prison or police station throughout the United Kingdom - and then be extradited to Spain to answer for it."

She described the arrest as unlawful and claimed it took place in "circumstances that would do credit to a police state".

Pinochet's enemies hated him because of his success in transforming Chile's economy under a free market model, Lady Thatcher argued.

"This is a government which reckons ageing spies who betrayed our country to Soviet communism should escape prosecution - yet obsessively pursues the frail 83-year-old Pinochet who stopped the communists taking Chile."

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The speech was the first time Lady Thatcher had addressed a Tory conference for nine years.

"A lot has happened since then - and not much for the better. Today I break my self-denying ordinance and for a very good reason - to express my outrage at the callous and unjust treatment of Senator Pinochet."

The former prime minister also stressed the crucial role Chile played as Britain's ally during the Falklands War.

That assistance had come on General Pinochet's express orders and saved the lives of many British troops, Lady Thatcher said.

She further claimed he would not receive a fair trial if the extradition process was completed and he went to Spain.

"The chance of Senator Pinochet receiving anything resembling what we in Britain would recognise as 'justice' in a Spanish court is minimal - not least because the key witnesses for his defence run the risk of immediate arrest if they set foot on Spanish soil.

"What is planned there is a show trial - lingering death in a foreign land."

'Europe to blame for everything'

Lady Thatcher had already provoked controversy at the Tory conference, even before she made her speech on the Pinochet case.

Lady Thatcher previously visited General Pinochet to show her support

Tory leader William Hague stood by her side on Tuesday evening as she told a meeting of Scottish Tories in Blackpool: "My friends, we are quite the best country in Europe.

"I've been told I have to be careful about what I say and I don't like it.

"In my lifetime all our problems have come from mainland Europe and all the solutions have come from the English-speaking nations across the world."

Former foreign secretary Sir Malcolm Rifkind later warned of the danger of Lady Thatcher creating "the impression that Britain and British opinion is somehow prejudiced and anti-European".

But when she took her seat on the conference platform on Wednesday morning, she received a standing ovation from party members.

Strong backing for Hague

Lady Thatcher has also used her appearance in Blackpool to issue a show of strength for the current party leader.

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Asked if it was true she had dubbed him "wee Willie", she said: "No, it's not the language I ever use."

She then gave her strongest backing yet to Mr Hague, urging Conservatives to rally round him.

"I support him absolutely," she said. "Have you seen his policies? He's terrific.