WHEN the bloodshed is over, Tony Blair may have to pay a heavy domestic price for the war in Iraq. Foundation hospitals and student top-up fees.

The idea of allowing elite universities to charge more than former polytechnics was never wildly popular among the Labour ranks. Nor was giving top hospitals greater financial freedom from Whitehall.

The argument in both instances was that it would create a "two-tier system", and most Labour MPs are strictly one-tier in their thinking.

But Mr Blair could have expected to win through, suffering only a manageable revolt. The 30 or 40 "usual suspects", as the whips' office calls them.

The Iraq war changed all that. It led to a raft of Labour MPs voting against the Government for the first time in their Parliamentary careers.

And, as one wry left-winger said, "once your virginity has gone, you can't get it back".

Now - with Ministerial careers either behind them or out of reach - they are ready to bloody Mr Blair's nose.

Most at risk are top-fees, which are still technically at the consultation stage. (This would, on paper at least, make a U-turn less humiliating.)

A senior source tells me the whips have done a ring round of MPs and haven't liked what they have heard.

There are enough MPs opposed to the idea to defeat Mr Blair - provided the Tories and Lib Dems also oppose the Government - and they are not afraid to do so.

So serious is the threat, education officials are already starting to look at alternatives - with an increase in the amount paid by all students now back on the table.

This would see all bar the poorest students paying around £2,000 per year, rather than the current figure of £1,100 - regardless which university they attend.

An Early Day Motion advocating this policy and attacking "differential" fees has just gone down. It already has the support of more than a dozen Labour MPs who were - prior to Iraq - loyal to Mr Blair.

And if a big name, say former Education Secretary Estelle Morris, were to sign that could be the hammer blow.

The same non-virgins have indicated they are also ready to vote down foundation hospitals, and the Government is running scared.

The Bill paving the way for the project was due to be debated before next week's Easter recess, but has now been delayed because Ministers are keen to avoid a bitter public row in the middle of a war.

There could be a twist with this one, however. The policy could be rescued by the Tories - who are keen on the idea and would love the chance to humiliate Mr Blair and split the Labour party in two.

The Tories are finalising their strategy and it is hard to say which scenario would be worse for the PM. A key New Labour reform biting the dust, or the site of crowing Conservatives applauding a policy so right-wing it needed their help to survive?

Meanwhile, business managers have also put back the final stages of the Hunting Bill until after the war is over. But, as long as it returns to the Commons by June, there is still plenty of time for a ban to be forced through. It is one piece of Government legislation which has overwhelming support on the Labour benches.

What a pity for Mr Blair it is the one for which he has shown least enthusiasm.

Updated: 10:57 Friday, April 04, 2003