Mr Blair must come clean if he is to avoid the taint of sleaze

Things looked bad enough for the Government last week. This week, it only gets worse. Opinion polls agree: support for the Government has tumbled. The four-point Tory lead over Labour revealed by a poll yesterday merely turned the knife in the already suppurating wound.

Things looked bad enough for the Government last week. This week, it only gets worse. Opinion polls agree: support for the Government has tumbled. The four-point Tory lead over Labour revealed by a poll yesterday merely turned the knife in the already suppurating wound.

Tony Blair himself, once the Teflon Prime Minister, has been badly hit. In addition, voters distrust this government's reputation for economic competence for the first time. One problem is that this Government, always so eager to please everybody, is now clearly divided on the contentious issue of the fuel tax - between those who believe that the Government should stick to its guns, and those who are eager to find some way of backing off. Gordon Brown, the Chancellor, insisted yesterday that "no government will or should ever give in to that kind of pressure." Downing Street shows every sign, however, of wishing to do just that. MPs who are worried about slender majorities will be getting edgy, too. Anything, just to get those polls back on track.

That, however, does not get rid of the problem caused by yesterday's allegations - that Downing Street now seems fundamentally dishonest. The Bernie Ecclestone affair was embarrassing, even when it first emerged three years ago. Downing Street banned tobacco advertising in sport - but exempted motor-racing, which just happened to be what Mr Ecclestone, £1m donor to the Labour Party and Formula One tycoon, was asking for. When the donation became public, Mr Blair's ability to appear impressively contrite meant that the headlines soon faded. At that time - though it is now difficult to imagine - little could tarnish the New Labour shine.

Andrew Rawnsley's Servants of the People alleges Downing Street deviousness in the determination to prevent the truth about Mr Ecclestone's donations from becoming public. Meanwhile, memories of Tory sleaze have faded, and Labour no longer seems cleaner than the others. On the contrary, Mr Clean and Decent Blair is now seen as heading up an administration in which lying is as an acceptable way of doing business.

The slump in the polls is not, of course, the end of the world. After more than three years in power, the truly bizarre element in the story is how Labour has managed to stay so strong. In addition, Downing Street can take comfort that the mistrust of the once squeaky-clean Labour Party is not accompanied by a new-found love of the still tame Conservative opposition. (The Liberal Democrats, by contrast, have benefited considerably.)

The real problem is that the troubles now besetting the Labour Party reinforce negative perceptions that already existed in the public mind. This is a government that is tainted with sleaze, while claiming to be clean; a government that is divided, while claiming to be united; a government that lies, while claiming to carry the trusty sword of truth.

Lies are bad enough; New Labour's copyright piousness compounds the problem. One reason why the Liberal Democrats have enjoyed such a boost is that they are seen as having a genuine set of beliefs. To dig himself out of this deep hole, Mr Blair must make a detailed repudiation of the allegations contained in Rawnsley's book. Until we get that, there will still be suspicion of lying and sleaze, and Labour's tribulations will only get worse.