The discussion, with Labour's advertising agency, BMP DDB Needham, was attended by senior party figures including Gordon Brown, the Shadow Chancellor; Alastair Campbell, Mr Blair's press secretary; Peter Mandelson, a key Blair ally; and the party's general secretary, Tom Sawyer.
The news follows last week's revelation that Mr Prescott had not received a memorandum by Bryan Gould, Mr Blair's political consultant, that was leaked to the Guardian last week. The meeting, about the presentation of economic policy, took place in February, about the time the Gould memo was being prepared.
Mr Prescott last night issued a statement saying: "This was a meeting about economic policy. There is no reason why it should not have taken place. Any attempt to say otherwise is pure mischief."
Tomorrow Mr Blair will use a special meeting of the Shadow Cabinet to shift away from party reform towards the development of new policy. But he is also moving to defuse attacks on his leadership style.
One source said: "Tony recognises the need for greater communication within the party about the changes. He decided, before the summer, that this would be addressed through revamped channels under the auspices of Walworth Road [Labour HQ] and through the whips' office."
Sources close to Mr Blair highlighted policy areas that will be raised at this month's party conference. They include plans to raise standards in schools, concentrate resources on the "front line" of the NHS, help home-owners, implement a fair tax system and fight crime.
A line will be drawn under party reforms for the time being. Mr Blair is now said to want to concentrate on the second half of the party's "New Labour, New Britain" slogan. "Tony has spent his first year modernising the Labour Party," said one source. "To go into a second year doing the same gives the message there is something wrong with Labour."Reuse content