Losing Campbell will help Blair regain public's trust

The loss of Alastair Campbell is a huge personal blow to Tony Blair, but it is also a necessary ingredient of his campaign to launch a "fresh start" after the death of Dr David Kelly.

As well as preparing for his appearance at the Hutton inquiry, Mr Blair has been drawing up yet another fightback plan since returning from his summer holiday a week ago. He has been chairing meetings at Chequers to plan a new structure for Downing Street, with new personnel to go with it.

The starting point was that Mr Campbell would depart; the only question was when. Initially, he intended to await Lord Hutton's verdict, but that will not come until October. Mr Campbell had no stomach for returning to his job, and it was agreed that the new team should start preparing for the challenges ahead, starting with the Labour Party conference in four weeks. Blair allies hope that Mr Campbell's exit will enable the Prime Minister to finally draw a line under the culture of spin which, however unintentionally, culminated in the battle with the BBC that ended with the death of a government scientist. The Blairites are well aware that they cannot spin the story that Mr Campbell's departure means the death of spin. The Government will be judged by its actions and the new structure under David Hill, Labour's former director of communications, is designed to secure changes that go beyond mere words.

Mr Hill is well qualified for the task. Trusted by journalists as straight and honest, he also has deep Labour roots and so his presence at the top table will reassure Mr Blair's party critics. As a trustworthy figure himself, he offers Mr Blair the best chance of achieving his most pressing task - regaining the trust of the British public.

Of course, Mr Campbell's decision leaves a gaping hole. He was always much more than a spin doctor. As Mr Blair's closest ally and political friend, he had more influence over the Prime Minister than anyone else. It extended to policy as well as propaganda. I once asked Mr Blair on a flight back from Washington whether he would introduce streaming in schools. Mr Campbell interjected: "If you do, I resign." He was only half-joking.

Can Mr Blair manage without Mr Campbell? Well, he has to, and so he will. And it would not surprise me if, after a necessary period of distance in public, Mr Blair takes private advice from his former director of communications and strategy. After all, there are telephones. Mr Blair has survived the loss of other members of his inner circle, such as his old friend Anji Hunter, and Blairite ministers such as Peter Mandelson, Stephen Byers and Alan Milburn. The departure of Mr Milburn was a particularly crushing blow to Mr Blair, who needs to rebuild links with his team of ministers after being immersed in foreign affairs for the past year. A recurring gripe among loyal Blairites is that the Prime Minister does not look after "his people". Such talk is dangerous at a time when Mr Blair's enemies are circling.

Allies are in no doubt that Mr Blair has the energy for the battle ahead. Even before the Kelly tragedy, he faced his most difficult Labour conference since becoming party leader in 1994. Last year, Labour officials spoke of a 4-1 victory after losing only one vote. This year, they are talking of a 4-1 defeat.

The party grass roots and the trade unions are worried by the problems in Iraq and the failure to find weapons of mass destruction. Rebellions loom over foundation hospitals, university top-up fees and public-private partnerships.

Aides say Mr Blair is determined to use the platform provided by the conference as an opportunity rather than see it as a problem. He is likely to offer the party a choice: either we stick together when times are hard, or we will suffer the same fate as the Labour governments of the Sixties and late Seventies and lose power. The message will be reinforced by John Prescott, who can reach the parts of the Labour Party beyond Mr Blair's grasp. At the same time, Mr Blair will repeat his mantra that bold reforms and tough decisions are needed to secure the country and its public services.

It will not be easy for Mr Blair to regain the political initiative. In his evidence to the Hutton inquiry on Thursday, he expressed his frustration that the row between the Government and the BBC had dominated the political agenda for three months. While he will try to "move on" at the party conference, he knows doing so will be difficult until after Lord Hutton reports in October.

Then his challenge will be to show that he has not suffered lasting damage from the Kelly affair. It will not be easy.