Sept. 28 (Bloomberg) -- U.K. Prime Minister Tony Blair said the ruling Labour Party should unite to win a third term in office after dividing over his decision to go to war in Iraq.

He pledged to focus on tax relief for working families and improving schools and hospitals. He acknowledged intelligence used to justify the war was wrong and stopped short of apologizing for backing his decision to help U.S. President George W. Bush topple Iraqi President Saddam Hussein.

``I can apologize for the information that turned out to be wrong,'' Blair said in a speech at Labour's annual conference in Brighton, England. ``But I can't, sincerely at least, apologize for removing Saddam.''

Blair's support has dropped during the past year amid questions over his handling of the war in Iraq. The plight of Kenneth Bigley, a British hostage being held by a terrorist group in Iraq, and the death of two U.K. soldiers in the region overshadowed Blair's effort to focus on the domestic agenda at the conference this week.

Labour's backing by voters fell to 36 percent in September from 42 percent at the time of the last election in 2001, according to a YouGov Ltd. poll published today in the Daily Telegraph. The poll's margin of error was 3 percentage points. Conservatives had support from 34 percent and Liberal Democrats 21 percent.

Iraq `Hurt Our Support'

``The war on Iraq has hurt our support,'' Robin Cook, who quit Blair's Cabinet in 2003 to protest the government's stand on the war, said in an interview. ``It's important for the prime minister to make clear we won't do it again.''

Outside the conference hall, about 8,000 protesters gathered to express anger about Blair's decision to back a ban on fox hunting, a traditional sport of aristocrats and residents from the countryside, outside the cities where most Labour backers live.

Inside the conference hall, Blair's speech was interrupted twice by hecklers. Blair smiled, saying, ``You can make your protest, just thank us that you live in a democracy and that you can.'' After the second, he said, ``If there are any more of you, do you mind standing up now.''

His comments on Iraq won applause from the hundreds of delegates and observers that crowded into the hall, even though a third of Labour's 411 members of parliament voted against military action in March 2003.

To contact the reporter on this story: Reed Landberg in Brighton, England landberg@bloomberg.net.

Last Updated: September 28, 2004 10:33 EDT