Blair back home after op

Tony Blair has returned to 10 Downing Street after undergoing a two-hour heart operation.

Arriving back at Downing Street, Mr Blair praised the staff at the Hammersmith Hospital.

A smiling premier said: "I'm absolutely fine thanks. The hospital staff, the nurses, the doctors were brilliant."

Confirmation that the procedure to correct an irregular heartbeat had been completed came as allies tried to quash questions over his future.

Mr Blair, 51, with Cherie by his side, said he felt "fine" this morning before he was driven to hospital. Medical experts and Downing Street said the routine treatment would have no impact on the Prime Minister's ability to carry on with his job.

He intends to return to work at the weekend and is sticking to plans to fly to Ethiopia next week.

But today the political focus was turning away from Mr Blair's health to his unprecedented decision to announce the date for his political retirement.

He said last night he will go at the end of a third term if returned at a general election expected next May.

Deputy Prime Minister John Prescott said today: "I do not see this Prime Minister being at any stage a lame duck. He will be a very effective Prime Minister."

Mr Blair's announcement means Cabinet colleagues will be certain of another five years of Mr Blair's leadership.

He will now definitely be in charge when a referendum is called on the EU constitution, probably in 2006, and will have time to push ahead with much of the radical agenda he mapped out at Brighton.

The view at Downing Street was that Mr Blair would be stronger in Labour's third term as a result of his announcement. "The real story is what another five years of Tony Blair's leadership will mean," said one senior source.

Mr Blair decided to announce some weeks ago that he would stay in office for another five years. "His heart procedure just seemed the right time to announce it," said the source.

Peter Mandelson, one of the Prime Minister's closest allies, writing exclusively in the Evening Standard today, says he believes Mr Blair's announcement will bring a period of peace and stability after a year of speculation about his future. Mr Mandelson says: "Now everyone knows. The voters will now decide his future, rather than some in the media and any on his own side wanting to hustle him out of office." He said the speculation would fade.

To many at Westminster, however, that seemed to be a forlorn hope.

Gordon Brown, after a triumphant week at the party conference, had an obvious head start to succeed Mr Blair and his supporters were predicting he would rapidly be seen as unstoppable.

The spotlight was thrown more than ever before on to the relationship between Mr Blair and Mr Brown.

Westminster was full of rumours that Mr Brown was not told about the Premier's dramatic statement about his operation until after he landed in Washington last night where he is attending a G7 conference. This was not confirmed

or denied by either side. Supporters of Mr Brown seemed unclear how they should react to Mr Blair's determination to stay on for five years.

There are at least three potential "stop Brown" candidates in the Cabinet - election co-ordinator Alan Milburn, Health Secretary John Reid and Education Secretary Charles Clarke.

Foreign Secretary Jack Straw and Home Secretary David Blunkett could also throw their hats into the ring.

One Labour MP said: "I cannot imagine Blair winning another vote like Iraq where the whips were threatening he would quit if he lost. That means whoever looks favourite to succeed him will increasingly call the shots."

With the prospect of a battle for Labour's soul breaking out, Mr Mandelson advised the Prime Minister: " Intensify your efforts to transform education and the health service and step up the pace of change so as to tailor these services more to the individual needs of those who depend on them."

His words appeared to be aimed at Mr Brown and other Cabinet members who were wondering what the future holds.

One of the big questions raging was how the handover will be carried out. Senior No10 advisers played down rumours that a new leader could be chosen early and then work in tandem with Mr Blair. "It will be quick and straightforward under the party rules," said one figure.

The problem, however, is that Cabinet manoeuvring before the contest date could cause tensions in Government.

It is believed Mr Blair considered standing down earlier this year when his political fortunes looked bleak but rallied after surviving the Butler Report. In recent weeks Mr Blair has looked stressed, notably over the hostage crisis. But he has played regular tennis and took part in a fun run.

Speculation over the Prime Minister's future intensified with the disclosure that the Blairs have bought a £3.6 million house in Connaught Square near Hyde Park for their retirement.

Mr Blair said it would be rented out while he served up to another five years in office but some wondered if he was planning to move earlier.

Last night Mr Blair played down the seriousness of his condition. "It's not particularly alarming, but it's something that you should get fixed. I've had it for the last couple of months, and it's not impeded me doing my work."