Rebel MP Crispin Blunt

Iain Duncan Smith has dismissed the resignation of a senior Tory as "irrelevant" claiming his party's gains in the local elections are a warning to Labour.

The Conservative leader hopes the 500-plus Tory gains will be enough to see off the latest threat to his position following a blistering attack from Crispin Blunt.

The trade and industry spokesman resigned after calling on Duncan Smith to quit.

Addressing party workers outside Conservative Central Office, Duncan Smith said: "Across the board, that the British people are really sending a message to the prime minister and Labour Party, that this government is failing them."

"It is failing them because it is taking more and more in tax and it is delivering less in services. They are saying enough is enough."

Asked if he had a message for his former colleague, Duncan Smith laughed off the threat.

"What he's said is irrelevant. It's on the sidelines," he claimed.

"My party last night across the board in England, Wales and Scotland united together to show that we have an alternative to Labour.

"Anything else is irrelevant and I have nothing more to say about that."

Duncan Smith also warned MPs who might consider following Blunt into open revolt to reflect on the council results.

"Dwell on what we did last night. Dwell on the success we had, the gains we made, the councils we succeeded in gaining," he said.

"And ask yourself the question. Do you want to beat the Labour government? Because I do"

And he repeated his bold claim that he would win the next general election.

"Any more navel gazing is out," he warned his critics.

"The alternative is front of them. A Conservative Party that offers a fair deal for people who are fed up with the government's failure.

"And I'm going to take that forward right to the general election an we are going to win."

Blunt's move triggered a fresh round of bloodletting within the party and is set to increase speculation over a possible leadership challenge during the summer.

Senior figures moved quickly to brush aside the threat and claimed the council successes were a vindication of the leadership's strategy.

Blunt quit the shadow ministerial team after warning that Duncan Smith would never lead the party to victory.

Launching a withering attack which threatened to overshadow the local and devolved elections, the Reigate MP said the Tory leader should resign "in the wider interests of the party".

"Whatever the headline results in today's local elections the fact is the Conservative Party is making no real progress when we should be taking advantage of the opportunity our opponents and events have offered," he said.

"If the electorate perceived us as a credible alternative government the potential support for us could carry us back to government.

"However we carry the handicap of a leader whom Conservatives in parliament and outside feel unable to present to the electorate as a credible alternative prime minister."

Blunt said Duncan Smith had "not made the necessary impact" and should go.

"If we are a political party that is serious about regaining power, our leader has to now be replaced," said the MP in a statement. "I hoped the leader could recognise this analysis himself."

Blunt said he hoped that 25 MPs would come forward to trigger a leadership election.

The intervention sparked a fresh round of speculation about the future leadership of the party.

Senior Tories rallied behind Duncan Smith in the wake of the attack.

Conservative chairman Theresa May said party workers "would feel very let down" by Blunt's actions.

Oliver Letwin said the MP was "a one off" who did not speak for the parliamentary party.

"We are unlikely to win elections if we change leaders every week. I think Iain will stay as leader and I profoundly hope he will," the shadow home secretary said.

Tim Yeo, the shadow trade and industry secretary, said: "I don't believe there is a threat to the leadership."

Labour was quick to exploit the latest bout of Tory bloodletting.

Commons leader John Reid said: "Tonight is both a temporary disaster for them and a set back but it is also symptomatic of a much deeper malaise in the Conservative Party itself which is becoming incapable of being led."

Lib Dem party chairman Mark Oaten said: "The knives are out before the results of local elections are even in."