No 10 dismisses Kelly as a 'Walter Mitty'

Downing Street will seek to defend itself over the death of David Kelly by portraying the scientist as a Walter Mitty character who exaggerated his role in the Government's intelligence case against Iraq.

Coming shortly before Dr Kelly's funeral on Wednesday, the description of one of Britain's most respected weapons experts as a fantasist is certain to spark fury among friends and former colleagues.

But, in what appears to be a change of tactics by the Government, a senior Whitehall source told The Independent that Dr Kelly had misled the Ministry of Defence and the BBC journalist Andrew Gilligan over claims that a dossier used to justify war against Saddam Hussein had been "sexed up".

According to the insider, Dr Kelly told Mr Gilligan more than he knew and then failed to tell his employers the whole truth of his contacts with journalists. "This guy was a Walter Mitty," he said.

Once his name became public and he was questioned by MPs over the affair, Dr Kelly became worried about his statements to the BBC, the insider said.

A reason for his suicide was the decision by the Foreign Affairs Select Committee to recall Mr Gilligan to comment on his own evidence, the source added. Dr Kelly went missing at about the time the journalist gave evidence. His body was found a day later near his Oxfordshire home.

The Downing Street version of events is sure to be seized on by the BBC as an admission that Dr Kelly had indeed given Mr Gilligan good reason to make his claims about "sexing up" intelligence.

But the scientist's family and friends are sure to be appalled at the Walter Mitty description of a man who was nominated for the Nobel prize and who was about to join the US-led Iraq survey group's hunt for weapons in Baghdad.

MoD sources have also revealed that Dr Kelly was being investigated for his contacts with journalists long before the dispute over Mr Gilligan's broadcast began. Downing Street will also seek to persuade the Hutton inquiry, which begins its formal hearings next week, that it and the MoD had been forced to publicise Dr Kelly's name by a parliamentary committee.

With Tony Blair, Geoff Hoon, the Defence Secretary, and Alastair Campbell, Downing Street's director of communications, all due to give evidence, the stakes could not be higher for the Government. But a main plank of its defence will be that the Intelligence and Security Cabinet Committee (ISC), which is holding its own inquiry into the intelligence case on Iraq, left it with no option but to confirm Dr Kelly's identity.

Sir Kevin Tebbit, the permanent secretary at the MoD, and Sir David Omand, No 10's head of intelligence and security, approached the committee's chairwoman, Ann Taylor, on 8 July to suggest she might want to call Dr Kelly as a witness.

But Ms Taylor is understood to have told them that while the committee would be willing to question the scientist, it could not act "blind". The MoD would first have to issue a public statement that an unnamed official had approached his line manager and was claiming to be the potential source for Mr Gilligan's report. The committee was worried that it might be accused of a cover-up if Dr Kelly's approach was to be made public late.

After the ISC's response, Mr Hoon and Sir Kevin decided on the infamous "confirmation strategy", in which the MoD would issue a statement saying that an employee had come forward and given clues to Dr Kelly's identity. By the next day, it had confirmed his name to journalists.

Since Downing Street also issued its own clues about the identity of the official, a crucial part of Lord Hutton's inquiry will be to discover exactly who authorised such statements.