Peter Mandelson has sparked more speculation about Tony Blair's future after he backed Gordon Brown as the prime minister's natural successor.

Mandelson, one of Blair's closest allies, made the comments in an interview for Alastair Campbell's new talk show on Channel 5.

"I think that when Tony Blair chooses to stand down as prime minister, or is not elected by the public, I think that Gordon Brown will be his New Labour successor," he said.

He adds that he should have made it clear earlier that he was backing Blair for the Labour leadership in 1994.

He explained that "it was more Tony's moment in 1994 than it was Gordon's, for a variety of reasons".

Mandelson's comments are being seen as an attempt to heal the divisions between him and the chancellor, and also as a way for Number 10 to demonstrate to Brown that Blair will, in due course, hand over the reins of power.

However, Peter Hain said he saw no prospect of the prime minister stepping down soon.

He is "absolutely determined and has really got his eye on the ball to drive this government forward," the Commons leader told the BBC.

Ed Balls, the chancellor's former aide who stepped down last week after being selected to contest the Normanton constituency at the general election, revealed that the chancellor had come close to quitting in 1999 after being invited to head the International Monetary Fund.

Balls said Brown had changed his mind after a private meeting with Blair.