BRITAIN: Allegations over "sleaze" and spin-doctoring have combined with a mounting sense of crisis over street crime to cap another difficult week for Mr Blair's Labour government.
As senior royals gathered at Windsor Castle for this afternoon's funeral of Princess Margaret, Downing Street was embarrassed by claims that the Transport Secretary's controversial adviser, Ms Jo Moore - who notoriously suggested September 11th was a good day "to bury" bad news - had likewise thought today's funeral a suitable occasion to publish unfavourable railway statistics.
Downing Street was dismissing the claims as "fiction". Number 10 was exasperated by what appeared to be an extraordinary inter-departmental bust-up.
However, this was nothing to the irritation at a sustained Conservative attack - augmented by two unhelpful Labour interventions - over the Prime Minister's help for a Labour donor's Romanian business deal.
Having already called for a public inquiry into the circumstances surrounding Mr Blair's letter to the Romanian Prime Minister supporting the takeover of his country's nationalised steel company by LNM, a company owned by the Indian tycoon Mr Lakshmi Mittal, the Conservatives turned their fire on Mr Blair's chief of staff, Mr Jonathan Powell.
Demanding Mr Powell's dismissal, the cabinet office spokesman, Mr Tim Collins, claimed it was "wholly indefensible" for Mr Blair's Downing Street "gatekeeper" to remain in his post because he must have known of Mr Mittal's £125,000 donation to Labour during last year's election.
In the Commons on Wed-nesday, Mr Blair three times refused a challenge from the Conservative leader, Mr Iain Duncan Smith, to say whether he or Mr Powell knew of the donation before Number 10 sent the letter to Romania backing the tycoon's takeover bid. Mr Blair maintained the letter he signed referred to LNM and not to Mr Mittal, but that even if he had known the connection it would have made "no difference" to his signing the letter, which was "entirely justified". However, it had already been claimed an original draft of the letter had been amended to delete reference to Mr Mittal as a "friend" of Mr Blair.
Downing Street was still battling yesterday to explain the "British" interest in a company registered in the Dutch Antilles and employing less than 1 per cent of its workforce in the UK. Demanding Mr Powell's removal, Mr Collins said: "It was always ethically dubious to have as his gatekeeper at Number 10 someone who had a role in party fund-raising. It is now wholly indefensible."
Mr Blair told yesterday's cabinet meeting the Tory allegations were nonsense. However, Mr David Clark, a former adviser to Mr Robin Cook when he was Foreign Secretary, said he "would certainly expect" Mr Powell to have known of Mr Mittal's donations from Labour's days in opposition.
A former Labour defence minister, Mr Peter Kilfoyle, said "somebody should take responsibility and make sure there was nothing questionable" about the letter.
Meanwhile, the Home Secretary, Mr David Blunkett, sought to regain the law-and-order initiative yesterday, giving Scotland Yard an extraordinary six-month ultimatum to sort out violent street crime in London or see him seize new powers and send in his own management hit-squad.
Mr Blunkett's overall two-year timetable to bring all crime under control came 24 hours after the former Mayor of New York, Mr Rudolph Giuliani, heard Mr Duncan Smith tell the Commons people were now twice as likely to be mugged in London as in New York.