Campbell wanted to leak success of mole hunt to paper, inquiry told

Alastair Campbell suggested leaking to a newspaper the fact that the source of the BBC report alleging that the Government "sexed up" the Iraq dossier had been uncovered, the Hutton inquiry was told yesterday.

The proposal by Tony Blair's director of communications and strategy for a secret briefing was disclosed by his deputy, Godric Smith, who said he had dissuaded Mr Campbell, warning the leak was a "bad idea". Mr Campbell did not mention this discussion in evidence to the inquiry on Tuesday.

Lord Hutton asked yesterday why Downing Street was insistent on exposing the scientist's identity when it already appeared to have been vindicated over the dossier. Questioning Sir Kevin Tebbit, the permanent under secretary at the Ministry of Defence, Lord Hutton noted that the Government had been cleared by the Foreign Affairs Select Committee and Intelligence and Security Committee, and the BBC had retracted its most damaging claim that the 45-minute claim was inserted by Mr Campbell although he knew it was wrong.

Mr Smith said that he had walked into Mr Campbell's office in No 10 at about 6pm on Monday 7 July - the week after Dr Kelly admitted to MoD officials that he had met Mr Gilligan - to find him talking on the speaker-phone to Geoff Hoon, the Defence Secretary. "Alastair floated the idea that the news that an individual had come forward who could be the possible source be given that evening to one paper," Mr Smith said. Mr Hoon had replied that he would "see where things stood".

Mr Smith said he thought Mr Campbell had been concerned that Mr Blair had been due to give evidence the next day to the Commons Liaison Committee and could be put in a "difficult position" if the subject came up.

Mr Smith said that, after Mr Campbell left the office, he had discussed the plan with Tom Kelly, the other prime ministerial spokesman, who had agreed it was not a good idea.

There remains a suspicion that Mr Campbell went ahead with a partial briefing to one paper. The Times reported on its front page the next day that it had been "told by a senior government insider" that the BBC source was "thought to be a London-based Foreign Office official who is not a member of the intelligence agencies".

Earlier, Sir Kevin Tebbit said that Mr Hoon rather than he had decided that Dr Kelly should appear in public before MPs. Sir Kevin told the hearing that the Prime Minister had also made known his view that the investigation into Dr Kelly should be intensified. He said: "The implication was that he [Mr Blair] did want something done about this individual coming forward."