Tony Blair is "too weak to root out dishonesty" in his government, Iain Duncan Smith has said.

As the Tories kept up the pressure on the transport secretary, the opposition leader challenged the prime minister to explain why Stephen Byers was still in his job.

"Does it remain a principle of the prime minister to sack any minister who lies?" Duncan Smith demanded to know. "Yesterday the transport secretary admitted to this House that he told the British people something that was fundamentally untrue."

"Before the prime minister came to power, he said, and I quote, 'I would expect ministers in a government I lead to resign if they lied'. If that is so why is the transport secretary today still in his job on the benches next to him?"

Defending Byers, Blair said he "expected the highest standards of propriety" but stressed that the transport secretary had given a full account of his actions to the Commons on Tuesday.

"Mr Byers came to the House yesterday and made an absolutely full statement and he and his department should now be allowed to get on with the issues that really matter," he said.

Hitting back, Duncan Smith said that the minister would never be trusted again.

"Under this transport secretary rail delays are up by 40 per cent and passengers are even last night petitioning this government to get rid of the transport secretary. Nobody will ever believe the transport secretary again," he said.

"The prime minister also said before he came to power, and I quote, 'no more sleaze and no more lies and no more broken promises'."

Blair dismissed those who were concerned with "scandal and gossip day after day". He said the transport secretary was setting out to repair the "botched privatisation" of Railtrack.

"I will tell you exactly what the transport secretary is going to concentrate on - sorting out a privatisation that was wrecked Britain's railways, making sure that we get the largest ever investment into the London Underground and appointing the right people to the Strategic Rail Authority so that we get the extra rolling stock and investment that the transport system needs," said Blair.

Reflecting on the crisis concerning Railtrack and the controversy surrounding the PPP plans for London Underground, the Liberal Democrat leader, Charles Kennedy, also took Blair to task over the future of the minister.

"In spite of the somewhat feeble inquiry of just a moment or two ago, could the prime minister explain to the people in the country why it is exactly he retains his confidence in the secretary of state for transport?" he asked.