The arrest of Damian Green in connection with alleged leaks from the Home Office comes towards the end of a week in which apparent disclosures from within the Treasury have been of far more concern to Gordon Brown and ministers. The hunt has been on for some time for two “moles” who ministers claim have been trying to undermine the Government; one in the Home Office and one in the Treasury.

Last weekend government press officers found themselves inundated with queries about Monday’s PreBudget Report. On Saturday reporters rang the Treasury asking whether it was true that VAT was to be cut by 2.5 per cent. This was to have been the centrepiece surprise of Alistair Darling’s statement, but the press had discovered it two days early.

On Sunday The Times learnt that Mr Darling was likely to introduce a new 45 per cent top rate of tax. Again this was something that he had had up his sleeve, he thought, to soften the impact of his announcement that national insurance would be put up for all. The Times and The Sun ran the story. Ministers were fuming. They have believed for some time that the Tories had knowledge of a Treasury plan to cut inheritance tax before George Osborne announced last autumn that the Tories would do so, wrecking plans for an early election.

The leaks from within the Home Office have caused similar exasperation. David Davis, a former Shadow Home Secretary, made the running with a series of stories that ministers believed could have been inspired only by a rogue element. One was about a change in the timetable for ID cards. Then a series of other stories, including a rundown of opposition among Labour MPs to the 42-day detention proposal and a letter from Jacqui Smith to the Prime Minister about the economic impact of the downturn, confirmed that a “mole” was at work. It was being emphasised last night that the Prime Minister had no prior knowledge of Mr Green’s arrest. But it is hard to avoid the impression that it was meant to be a warning to others. If there are others, perhaps in the Treasury, they may sleep a little less comfortably tonight.

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