The falling out between the Tories and big business will be underlined today, when Mr William Hague challenges the Confederation of British Industry's support for membership of the European Single Currency. A succession of ministers will travel to the CBI conference in Birmingham this week to exploit the rift, and highlight Labour's claim to be now the party of industry and commerce.
As Sir Edward Heath led a renewed assault on his party's attitude to Europe yesterday - confirming he would defy a party whip and abstain in Wednesday's Commons vote on the Amsterdam Treaty - ministers were also hoping the Tory turmoil would mask their embarrassment in the continuing controversy over the exemption of Formula One from a tobacco sponsorship ban.
Labour yesterday played down the significance of the news that Mr Max Mosley, who heads the body which persuaded the government to exempt Formula One from its anti-smoking policy, is a long-standing contributor to party funds.
Sections of the British press are beginning to note the "teflon" qualities of Mr Blair's government, after a series of policy Uturns, mishaps and revelations of the kind so frequently seized upon to question the standards of the previous Conservative government. But the major focus remains on the increasingly bitter confrontation between the Conservative Party and the organisation once considered "the Tory party at business".
On the eve of conference, Sir Colin Marshall, the CBI president and chairman of British Airways, insisted Mr Hague and the Conservative Party were wrong to oppose British membership of the single currency. The latest CBI survey of some 700 mostly small and medium-sized businesses showed most wanting to join the currency, against which Mr Hague has effectively committed his party for 10 years.
But as Mr Hague prepared to tell business leaders some "home truths", the Conservative Party chairman, Lord Parkinson, questioned whether the CBI was wholly representative of business opinion on the issue. "We feel the CBI is not wholly representative. The Institute of Directors, which has a broad membership, shares our view and it's quite wrong to think the CBI is the custodian of all business wisdom," he said.
Earlier, on GMTV, Mr Hague insisted he was not "picking a fight with the CBI". He maintained that on the majority of issues they remained "at one".
However, on the issue which Mr Hague seems determined will define his leadership, he said: "Sometimes you have to fall out, you have to disagree with your best friend without it being a permanent breach - and you can give your best friend candid advice."
Mr Hague said he expected "they will find my analysis of the situation not a million miles from theirs."
He continued: "They say we will join when the time is right. I am saying how are you ever going to know that the time is right, and how can you be sure it is right to go into something in the next few years which will be a permanent arrangement, and something you wouldn't be able to get out of?"
The Chancellor of the Exchequer, Mr Gordon Brown, will today announce Britain's first steps towards joining a single currency, The London Times reports. The report says Mr Brown's speech will signal that the committee of senior ministers, the CBI, The Chamber of Commerce and trade unions that he has established will begin work on Wednesday on administrative arrangements to oversee the change over if Britain does join the EMU. According to the Times, Mr Brown will also announce that the Treasury is to apply to the EU for £5 million to pay for an education programme to promote the merits of the single currency.