Black Wednesday: New Labour's triple whammy

A sex scandal, a public humiliation, a Home Office bungle, and apologies in triplicate. New Labour has hardly experienced a tougher 24 hours than its own version of Black Wednesday, at the end of which there were question marks over the future of three of Tony Blair's most senior ministers.

Mr Blair has had his bad days before - the Ecclestone affair, the death of David Kelly and the double resignations of both Peter Mandelson and David Blunkett: this one, though, was different. It was a triple whammy - controversies swirling around John Prescott, Patricia Hewitt and, most seriously, Charles Clarke.

There were indeed echoes of the dying days of the Major regime, and a fin de siècle atmosphere pervaded at Westminster last night as Mr Blair was thrown on to the defensive at Prime Minister's Questions, with his greatest discomfort over the release of 1,023 foreign criminals from British jails - 288 of whom were set free after the Home Office was warned there was a problem.

Labour MPs expressed concern that the disclosure, the job cuts in the National Health Service and the "cash for peerages" scandal would harm the party's prospects in the council elections in England a week today. They warned that if Mr Blair did not "get a grip" immediately, he would have to stand down "sooner rather than later."

Mr Blair's day went from bad to worse. His preparations yesterday morning for his weekly joust with David Cameron at noon were interrupted by the disclosure in the Daily Mirror that John Prescott had a two-year affair with a civil servant working in his private office.

Mr Blair was said to be "relaxed" about Mr Prescott's former relationship with Tracey Temple, his 43-year-old diary secretary, with whom he was pictured cuddling and dancing at an office party and attending a memorial service for British troops killed in Iraq.

Mr Prescott, 67, faces accusations of hypocrisy after ridiculing the Tories over their sexual peccadilloes during John Major's government.

Yesterday the tables were turned as MPs in all parties wondered whether the Blair administration had now reached the "tipping point" that the Tories hit on Black Wednesday in 1992 - and was beyond recovery. Tory MPs could not help but relish what they called "Labour sleaze". One Labour MP admitted: "They used to say Tory scandals were about sex and Labour ones about money. Now we seem to be managing both."

Mr Blair knew his "High Noon" battle with Mr Cameron would be dominated by the prisoner release fiasco. Amid highly charged exchanges, the Tory leader demanded the resignation of Charles Clarke, the Home Secretary, and questioned Mr Blair about what he knew when.

The Prime Minister then left the Commons chamber, leaving Mr Clarke to face the music in a difficult emergency statement. Mr Blair's rapid exit provoked speculation that he was distancing himself from his beleaguered Home Secretary - although Downing Street insisted he still enjoyed the Prime Minister's full confidence.

Chances of Clarke surviving

At 2.50pm, Mr Clarke was called in by the Labour whips. The Home Secretary is determined to ride out the storm, but told friends it could cost him his job if evidence emerges of released foreign prisoners committing serious offences. Mr Blair, who has always prided himself on his tough line on crime and immigration, regards the prisoner releases as the most serious aspect of the triple crisis that crippled the Government yesterday.

Downing Street made clear that Mr Blair had only just learnt details of the 288 offenders let out without checks since July when Mr Clarke was told about the mistakes. In a desperate attempt to track them down, the Home Office forwarded the names of the 80 most violent offenders to police chiefs. Although most Labour backbenchers still want Mr Clarke to survive, two MPs suggested he may be forced to resign. Lindsay Hoyle, the MP for Chorley, said the public expected Home Office officials to resign. But he added: "I have got to say the public opinion is they also expect elected members to consider their position when actions so seriously have happened and I must pass that advice to you."

Ian Gibson, the MP for Norwich South, said: "Who knows what's going to happen? I think he's not personally to blame. It's someone down the line. There's a lack of interaction, somebody hasn't been pulling people together, but at the end of the day the buck stops there." One member of the Government said: "If I thought his resignation would solve anything I would support it."

Mr Clarke has insisted that he only learnt of the chronic breakdown of communication between the Prison Service and the Immigration Service last July.

But doubts grew about his survival after it emerged that both the Chief Inspector of Prisons, Anne Owers, and the Prison Reform Trust had raised the alarm over the issue in 2004.

Nurses turn on Health Secretary

While Mr Clarke met the Labour whips, word spread that Patricia Hewitt, the Health Secretary, was having a terrible time as she addressed the annual conference of the Royal College of Nursing (RCN) in Bournemouth.

Nurses booed, slow handclapped and jeered her after she insisted that there were more nurses, shorter waiting times and better results in the NHS than before. One of the more moderate health unions was giving the emissary from a government that has doubled spending on health the roughest ride any minister has faced since Labour came to power in 1997.

Back at Westminster, a Labour MP watching television with disbelief said: "To lose the nurses is a disaster." Another said that while a contrite Mr Clarke had got the tone right, Ms Hewitt had alienated the nurses by getting it wrong.

Ms Hewitt was forced to cut short her speech to the 2,000 RCN delegates and take questions instead after they began booing, stamping their feet and waving placards with the slogan: "Keep nurses working, keep patients safe."

She was visibly under pressure as one delegate told how staffing shortages meant that he was often the only specialist nurse on a neo-natal unit caring for 14 extremely premature babies.

When she suggested that his individual trust was to blame, she was jeered. She was also booed when she said that the redundancies announced were not real because they involved agency staff and that the problems could be rectified by "reorganising rotas to use permanent staff better".

More than 13,000 NHS jobs are being threatened with redundancy, a third of them nursing posts, because of the £623m deficit facing trusts.

Reshuffle speculation

By mid-afternoon, Downing Street was in crisis management mode. Even Blair allies were wondering whether the Prime Minister might be driven out prematurely by what Harold Macmillan, the former Tory prime minister, described as "events, dear boy, events." A Labour MP said: "It's the cumulative effect that is so damaging. The Government looks at the mercy of events."

Outwardly, the Government tried to maintain calm. Mr Blair's spokesman said: "Government is about dealing with unforeseen events and the important thing is, do you have the capacity to respond to events and do you have the capacity to implement the manifesto on which a Government was elected and the vision to keep that going despite events? You don't under-estimate the impact of events but you don't allow them to distract you from the big picture."

As MPs discussed the turmoil in the Commons tea rooms, they speculated that Mr Blair would try to reassert his dwindling authority by calling a snap reshuffle immediately after the council elections. They also wondered whether Mr Clarke and Ms Hewitt would survive in their current posts.

Prescott is 'mortified'

A day of drama could also cut short Mr Prescott's time at the top of the Government. Although 67, he had been planning to carry on as Deputy Prime Minister after Mr Blair stands down -with the blessing of Gordon Brown, Mr Blair's most likely successor, who wants him to stay on through the "transition period" to provide continuity and stability. The move would also avoid a potentially divisive election for the deputy Labour leadership.

However, Labour MPs believe the revelation might persuade Mr Prescott to quit frontline politics when Mr Blair leaves Downing Street. If Mr Prescott does stand down, there could be a lively contest for the deputy leadership.

Allies of Mr Prescott said he would be "mortified" by the revelations and worried about the impact on his family.

Countdown to a crisis for the Home Secretary

The crisis that threatens to engulf Charles Clarke has been brewing for more than two years. For much of that period the Home Office appears to have either ignored warnings about foreign prisoners being released without deportation checks or to have grossly underestimated the scale of the problem.

JANUARY 2004 Anne Owers, the chief inspector of prisons, raises the alarm over the lack of checks on foreign national inmates in her annual report for 2002-03. She bemoans the lack of expertise among prison managers in dealing with them and the failure to have effective "procedures to manage deportation or repatriation" and says there is an "institutional blindspot for foreign nationals".

MAY 2004 The Prison Reform Trust, which has regular meetings with the Home Office, says details about foreign inmates became lost in the system because of "poor coordination" between the prison and immigration services.

SEPTEMBER 2004 An internal Prison Service memo stresses the importance of communicating with immigration officers over the status of foreign inmates.

DECEMBER 2004 Charles Clarke succeeds David Blunkett as Home Secretary.

JANUARY 2005 The extent of the problem is uncovered after a change of management within the Home Office, according to No 10.

JULY 2005 In a report that reaches ministers' desks, the National Audit Office protests over the failure to deal with foreign criminals.

OCTOBER 2005 Sir John Gieve, who was Permanent Secretary to the Home Office, assures the Public Accounts Committee (PAC): "We have got an arrangement now where the prisons notify the Immigration Service when there is 12 months left to run on the sentence ."

NOVEMBER 2005 Sir John tells the PAC : "From 2001 to August 2005, we know of 403 foreign nationals who were released from prison without deportation proceedings being completed." Sir John adds that a "specialised team" had been set up in the Immigration Service.

DECEMBER 2005 Tony Blair and Mr Clarke discuss the problems in dealing with foreign prisoners in England and Wales, whose numbers now exceed 10,000.

FEBRUARY 2006 According to Downing Street, ministers learn that foreign prisoners are still being freed without being considered for deportation.

APRIL 25

1pm The Home Office admits that 1,023 prisoners had escaped deportation hearings over seven years and that it misled the PAC about the extent of the problem.

10pm Says 288 prisoners were released without hearings.

YESTERDAY

12.10pm PM says he has just learnt about the 288 figure.

12.30pm In a Commons statement, Mr Clarke brushes off Tory and Liberal Democrat calls to resign and promises to provide more details about the prisoner releases by the end of the week.