Smash hit

This morning Labour seized gleefully on the extraordinary gaffe, claiming that it showed the Tories in their true colours. Soon after, Mr Howard called an emergency press conference to announce that he had withdrawn the whip from Mr Flight.

Labour's election co-ordinator, Alan Milburn, claimed that Mr Flight had been sacked for telling the truth. He said: "He has exposed that the Tories have a secret plan to go much, much further, with even more deep and damaging cuts that could only be made by hitting frontline services like hospitals, schools and the police." He stressed that Mr Flight was not an isolated maverick, but was voicing the private opinions of the entire Tory leadership.

Speaking at an engagement in County Durham, Tony Blair said the Conservative Party's hidden agenda was a return to the old days of Thatcherism. He said: "The fundamental point is that the Conservative Party has not changed.

"An economic plan that even had the spending cuts they are admitting, never mind the ones they are hiding, would just take us right back to the economic risks, the end of investment of public services, the social division that people wanted to leave behind in 1997.

"That's why it is important that the country does not go backwards."

Vince Cable, the Lib Dem Treasury spokesman, said: "Howard Flight is a very senior, indeed respected, figure who was at the heart of Conservative economic policy-making.

"The problem all along has been that they have been promising simultaneously to cut taxes, improve public services, and reduce the budget deficit. They say 'We will just cut waste' and hope people will take them on trust - and now they have been found out."

Mr Milburn also challenged the Conservatives to "publish every last bit of the James Review - background papers, every small cut, every large cut".

When he was shadow chief secretary to the Treasury, Mr Flight was involved in setting up a savings review under David James, a business leader, which identified £35 billion of savings from cutting back on Whitehall waste, and enabled the Tories to announce plans to cut tax by £4 billion after the election.

But Mr Flight - a former aide to Norman Tebbit - made the mistake of hinting that further tax and spending cuts would follow after the election.

In a speech to the Thatcherite Conservative Way Forward group on Wednesday, Mr Flight said: "The potential for getting better taxpayer value is a good bit greater than the James findings (which have been) sieved for what is politically acceptable and what is not going to lose the main argument."

After the election "you can actually get on with what needs to be done", he said. Mr Flight also said the Tory proposal for pensioners' council tax rebates was "nakedly political", and suggested further vote-winning promises were likely to include raising income tax and inheritance tax thresholds.

The gaffe comes as a relief for Labour, which had been criticised for saying that the Tories plan to cut spending, when they simply plan to increase spending at a lower rate than the Government.

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