Tony Blair has said it would be "utterly ludicrous" for him to get personally involved in the latest row over immigration policy.

Speaking in the Commons, the prime minister rejected Conservative calls for him to take control of the investigation into how Home Office officials effectively relaxed official immigration policy without informing ministers.

It was revealed in the weekend's papers that officials waived key checks on immigrants from eastern Europe.

Responding to calls to say who authorised the relaxation of the checks, Blair said it had been the responsibility of "managers in the Sheffield office".

Michael Howard said that Steve Moxon, the civil servant from the Immigration and Nationality Directorate who revealed the policy, had been suspended while no action had been taken against the managers responsible.

"Mr Moxon, the man who told the public the truth, is suspended. The managers... who introduced the secret policy and the minister who didn't have a clue what was going on are still in place.  Why is that fair?" he asked.

Meeting offered

Blair said it was for the department to decide on personnel issues, and added that the number of immigrants affected had been much smaller than that suggested in the media.

"Of course it is important... to establish exactly what happened and no doubt any disciplinary procedures will follow on the outcome of that," he added.

The prime minister also turned down an offer to meet Moxon.

"There was a practice that was developed in this office that should not have been developed," he accepted, adding that it involved "a very small number of people".

Pressing the prime minister further, Howard accused ministers of not knowing what actions their departments were taking.

"This is a government in which ministers don't know what is happening in their departments, in which departments deny the truth and then have it dragged out of them, in which people are allowed to stay in the country without any proper checks being made and in which the only person who suffers is the whistleblower who tells the truth," said the Conservative leader.

But Blair said the department should conduct its inquiries "in the proper way".

He added that it was "utterly ludicrous" for Howard to urge him to take personal responsibility for the issue.

Howard said Blair was "the minister responsible for the civil service".

Equitable Life

Liberal Democrat leader Charles Kennedy highlighted the report by Lord Penrose into the collapse of Equitable Life, arguing the government was partly responsible.

"Would the prime minister accept that the complacent and misleading response that was given to the report will come as a serious disappointment to the one million people who have lost so much?" he asked.

Tony Blair rejected the idea that the government should step in.

"He [Lord Penrose] did put the majority of blame with the society itself. There was nothing complacent about the response at all," the prime minister said.

Blair ruled out the prospect of government compensation that could run into billions of pounds.

"All parts of the House realise it would not be possible to do that. Any other investigations by outside bodies are a matter for them," he said.

NHS treatment

In his second set of questions, Howard again challenged Blair on the topic of NHS treatment of wet age-related macular degeneration.

The Tory leader claimed last week that thousands of people will go blind as a result of a delay in the implementation of new guidelines on treatment of the disease.

The prime minister had then promised to write to the Conservative leader with a more detailed answer, which he has so far failed to do.

Howard said Blair's response was inadequate.

"The Royal National Institute for the Blind are not at all convinced by what the prime minister said," Howard added.

"They say 'the government are dragging their feet, there is no shortage of doctors, we know of 50 centres around the country that can provide people with treatment who otherwise might go blind. The situation as it now stands is a sham and it has effectively denied people treatment for far too long'."

Blair replied that the delay was agreed with the National Institute for Clinical Excellence in order to prepare the NHS to properly implement the guidelines.

"We have to build the capacity to treat the condition properly," he said.

"We are aware that the RNIB are making these claims but they are disputed by those who have to implement this policy."