Blair seeks to calm Robinson 'froth'

Peter Mandelson: Focus of more attacks from his former colleague

Prime Minister Tony Blair has sought to dismiss as "froth" the furore over government in-fighting as former paymaster general Geoffrey Robinson's memoirs continued to highlight bitter rivalry at New Labour's top table.

With Northern Ireland Secretary Peter Mandelson under fire for a second day from the man who gave him a secret loan, Mr Blair refused to answer questions on Mr Robinson during a prime ministerial engagement with the Royal College of Surgeons.

Instead he dismissed the row, telling his audience: "Whatever the froth of the day to day, the only thing that matters to people are the fundamentals."

In the latest instalment of Mr Robinson's memoirs - serialised in the Daily Mail - he accused Mr Mandelson of being a "destabilising influence" between Mr Blair and Chancellor Gordon Brown.

He also, according to Mr Robinson, deliberately sought to thwart attempts to present a united front on government policy on the single European currency.

'Easy prey' - Mandelson

Tony Blair: Insisted on sticking to "the fundamentals"

Mr Mandelson responded by accusing Mr Robinson of being "vulnerable easy prey" who had been manipulated into a plot against him part-driven by "more than a hint of homophobia".

Mr Robinson claimed Mr Mandelson not only caused difficulties between Mr Blair and Mr Brown but also lengthened the uncertainty about what the government's policy was.

The result, according to Mr Robinson, was that "the financial markets were in turmoil, not knowing what the policy on Europe really was. The unofficial briefings had spun out of control, and the government had only itself to blame."

After the Treasury issued a statement saying it was "extremely unlikely" Britain would join the single currency in 1999, Mr Robinson says his former ministerial colleague publicly contradicted the policy.

"There was really no need for this. Whenever Peter intervened in a major issue of this kind, it raised several questions,'' said Mr Robinson.

He went on to say he believed Mr Mandelson made his intervention because of his personal pro-euro beliefs.

The Coventry MP accused Mr Mandelson of pursuing a private agenda "markedly different" from those of the prime minister and the chancellor.

"No one can ask Peter that he should not pursue his own ambitious agenda, but too often the briefings and leaks cause him to become a destabilising influence," said Mr Robinson.

Geoffrey Robinson: The millionaire bankrolled New Labour

Meanwhile the issue of whether Mr Robinson funded Mr Blair's private office in opposition - a claim denied a year ago by Baroness Jay, a trustee of the "blind trust" that paid for the office - refused to go away.

In his book Mr Robinson said he was "happy" to help bankroll Mr Blair's office in the run-up to the 1997 election.

But a senior Labour spokesman said while Mr Robinson had given money to the party and was listed as a donor, cash had not directly gone to Mr Blair's office.

Seizing on the latest public spillover of internal rows at the top of New Labour, Conservative leader William Hague said members of the government were acting like "rats in a sack" because of deep divisions and personal hatreds.

In a speech to the Carlton Club later on Tuesday, he said Mr Blair's administration was "a rotten government and the rot starts at the top".

Liberal Democrat leader Charles Kennedy said Labour's splits at the top were hindering effective campaigning for the euro.

"Clearly, behind the scenes, they are not doing that because there are too many divisions amongst the senior personnel involved," said Mr Kennedy.

"All that we have seen in recent days confirms that gloomy prognosis."