Pressure over sleaze allegations mounted on the government over the weekend, after reports revealed that the Department for International Development was instrumental in securing a £70 million "soft" loan for Lakshmi Mittal's LNM Group - and may be called to do so again.

It also emerged that Mittal sought to undermine the British steel industry by lobbying for the introduction of tariffs on the importation of steel into the US.

As a poll found that 60 per cent of voters thought Labour was "sleazy", senior Labour MPs were calling on the prime minister to shake-off weeks of bad headlines.

One minister said the situation looked "awful", adding: "We've been on the defensive for months."

As the questions began stacking up, the opposition renewed calls for a full public inquiry into the Steelgate affair.

Iain Duncan Smith said there was a "trail of cover up and deception" emerging from Downing Street.

The Sun's Trevor Kavanagh concludes that Blair "is on extremely thin ice and he knows it".

Number 10, however, has hit back, accusing the media of "hysteria" in its reporting of the Mittal affair.

Downing Street has also been forced onto the defensive amid claims that ministers no longer believe the civil service to be impartial.

A spokesman for the prime minister insisted yesterday that Tony Blair has faith in the "professionalism" of civil servants across Whitehall.