The latest opinion poll has delivered a further blow to Tony Blair.

A MORI survey for the FT found that 63 per cent of voters believe the prime minister is "losing his grip" - with 43 per cent of Labour supporters backing the assertion.

Nearly 40 per cent of those polled said they had lost trust in the Labour leader since the beginning of the year.

The shift follows the Iraq war and on-going rows over the government's weapons of mass destruction dossier - coupled with controversy over policies such as foundation hospitals.

The number of people believing that the key public services - health, education, policing and transport - are improving is also down.

Most voters now expect that public services will get worse rather than better over coming months.

And some 83 per cent of voters polled believe Labour is divided on the issue of the single currency.

This compares to 60 per cent of people who believe the opposition is split on the issue.

The poll will heighten speculation that the prime minister is no longer the electoral asset to the party that he once was.

But Downing Street's official spokesman denied that the prime minister had lost his touch.

"If we reflect on this period in which we have seen a very difficult situation in Iraq, a war fought, a war fought successfully, a period of reconstruction begun in Iraq, continued improvements in health, education and transport, accepting all the difficulties that remain, and the prime minister's continued commitment to seeing those policies through, I don't think it is possible to say that he has lost his grip," the spokesman said.