Tony Blair today shrugged off claims he had suffered his "Geoffrey Howe moment" with criticism from ex-Home Secretary Charles Clarke that could trigger his exit from No 10.

Mr Blair rejected Mr Clarke’s claim that he had lost direction and insisted it was time for the Government to "calm down, hold our nerve and get on with governing".

And he hinted he could even hang on for four more years before stepping down.

Tories claimed that Mr Clarke’s stinging remarks were comparable to the ferocious resignation speech made by Geoffrey Howe in the House of Commons, which led to the downfall of Margaret Thatcher.

Asked today whether he had just had his "Geoffrey Howe moment", Mr Blair replied firmly: "No. I actually have a very great regard for Charles, both for what he did in Government and afterwards.

"I simply felt he had to move from his position for the reasons I gave at the time."

Speaking at a Downing Street reception for members of the British Society of Magazine Editors, Mr Blair said it was only a year since the last election, adding: "We have got three years, if not more, before the next General Election.

"What we should do is calm down, hold our nerve and get on with governing."

Responding to Mr Clarke’s charge that the Government was losing its sense of direction, Mr Blair said: "The fact is - whether it is Health Service reform, which some people may disagree with, schools reform, which some people may disagree with, energy policy, which obviously people do disagree with, pensions reform - across a whole range of issues, this is a Government basically (whose) problems arise not from a lack of doing things. We are doing things.

"People may disagree with the direction, but that we have a direction is very, very clear.

"The most important thing is to get on with the business of government. The surface noise that happens is just what happens in government, and I have learned to appreciate that over the years."

Asked how he would be tackling Mr Clarke’s criticisms, the Prime Minister responded: "You don’t tackle them, you get on with tackling the issues people care about."

Earlier, Mr Clarke’s co-ordinated media assault had been met with an unusually blunt rebuttal from Downing Street. Mr Blair’s spokesman told journalists that he had a "duty" to sack Mr Clarke as Home Secretary because the Home Office needed new leadership.

He suggested that additional reasons to dispense with Mr Clarke’s services had emerged since the Cabinet reshuffle in May.

The spokesman also indicated that Mr Blair would have preferred Mr Clarke to keep his mouth shut after the turned down the offer of alternative Cabinet posts. He talked pointedly of the way that Mr Clarke "did not hide his disappointment" at the time - code for Mr Blair’s displeasure at the continued outbursts from a formerly ultra-loyal supporter.

In an interview with The Times, Mr Clarke insisted that he wanted to see Mr Blair continue as Prime Minister until 2008. But he added: "I do think there is a sense of Tony having lost his sense of purpose and direction, so my advice to him is to recover that sense of purpose and direction and that remains the best option."

The Tories described Mr Clarke’s comments as a new Labour equivalent of Geoffrey Howe’s resignation statement as Foreign Secretary, which triggered the fall of Baroness Thatcher.

Sir Menzies Campbell, the Liberal Democrat leader, said: "It is clear that the Prime Minister’s authority is simply draining away. This is no longer merely a question of the interests of the Labour Party, but the interests of the country.

"How can senior civil servants be expected to deal with vital political issues when there is such uncertainty at the heart of government?"

Alex Salmond, the Scottish National Party leader, said: "This is just the latest instalment of the Labour leadership Punch and Judy show."

Frank Dobson, a former Health Secretary whose political career stopped dead under Mr Blair's leadership, added to the chorus of disapproval, saying that the PM was a "liability".

But Jim Knight, an Education Minister and Labour’s MP for super-marginal South Dorset, defended |the PM. He told Today: "I talk to a lot of my colleagues and most of my colleagues find some of the people like Frank irritating because we want to talk about implementing the manifesto and getting on with the job we were elected to do, rather than sniping from the background.

"Ex-ministers coming on and bitching about the Prime Minister doesn’t do the Labour Party any favours."

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