Gilligan's report was regarded within No 10 as an attack on Blair's integrity

A confidante of Tony Blair launched a withering attack yesterday on Andrew Gilligan's report that the Government's September dossier had been "sexed up'' to strengthen the case for war.

Sir David Manning, former foreign policy adviser at Downing Street, said the claims had provoked "strong feelings'' within Mr Blair's inner circle. "It was seen as a pretty direct attack on the integrity of the Prime Minister and officials at No 10 that they would try to persuade the chairman of the JIC [Joint Intelligence Committee] to massage or revise his conclusions, his recommendations for political advantage,'' Sir David said. The report for the BBC was also viewed as an attack on John Scarlett, the JIC chairman, "because implicit in this is the assumption that he is willing to do it''.

Sir David told the Hutton inquiry that he did not believe he had been witnessing an argument with part of the media. The BBC's claims amounted to a challenge to the "integrity of the process of government''. He was asked by James Dingemans QC, counsel to the inquiry, about the suggestion by the Prime Minister's official spokesman Tom Kelly, that the government and BBC were playing a game of "chicken''.

Sir David, who recently became the British ambassador in Washington, insisted there was not "some kind of war'' between the two institutions.

He said: "I think on the whole Tom is pretty well balanced ... What he wanted to do was impress upon the BBC that we thought the evidence put forward by Dr Kelly was a direct challenge to their version of events and they had been unwilling to give any apology.''

Sir David disclosed the details of a meeting at Downing Street chaired by the Prime Minister after Dr Kelly was interviewed by MoD officials about his contacts with Mr Gilligan. Mr Blair was told by officials that they had decided to re-interview Dr Kelly amid growing suspicions that he was the source of the BBC reporter's story.

"The Prime Minister readily agreed because he didn't want to do anything precipitate and felt we needed to establish more closely what the connection was between Mr Gillligan and Dr Kelly.''

At a second meeting, to prepare for a Commons appearance before select committee chairmen, the Prime Minister decided he would sidestep questions on whether he knew the possible identity of Mr Gilligan's source. In the end the issue did not come up.

Sir David said he could not think of an episode in Whitehall that had followed a similar pattern. He said that different departments had their own procedures for dealing with those who confessed to having unauthorised media contacts. He said: "I thought it very unlikely that, if the conclusion was reached that Dr Kelly might be Andrew Gilligan's source, that it would be possible to shield his name from public knowledge.''