The Tories have written off their chances of winning – or even coming close to winning – in this week’s crucial Rochester and Strood byelection, saying the best they could now hope for is to cut Ukip’s victory margin to less than 10 points.

The admission – designed to limit the shock to Tory MPs of a thumping defeat on the night – is nonetheless a humiliation for David Cameron and his party, which said a few weeks ago that it was confident of victory and would “throw the kitchen sink” at defending the seat. With Ukip leader Nigel Farage predicting more defections in coming weeks, the Tories are now claiming they are not unduly worried by a second byelection loss to the anti-EU party, because they also expect Labour to suffer a meltdown in its vote.

Asked whether the Conservatives still believed they could win in the Kent seat, which they took from Labour with a 9,953 majority at the 2010 general election, a Tory cabinet source told the Observer: “We have got no reason to think the published polls are not true. They have shown a 12- or 13-point Ukip lead. If we were able to squeeze it to single digits, then great.”

The source added: “Our vote is holding up OK. We are at 30%, maybe even 33%. It is not bad. Ukip are in the 40s. But Labour have absolutely capitulated and collapsed in a seat that they held until 2010. There are at least as many questions for Ed Miliband as for us. We are fairly relaxed about the whole thing, as I think it is priced in at this stage.”

The Conservatives are taking comfort from a poll last week by former Tory vice-chairman Lord Ashcroft that suggested that voters were likely to use the byelection to voice a protest and then return to them in the general election, ousting the defector Mark Reckless after just six months as a Ukip MP.

On Saturday, as the fast-growing far-right group Britain First, which has invaded mosques dressed in paramilitary-style uniforms, staged a march through Rochester, the Conservatives said there were clear links between the group and Ukip – a claim rejected outright by Ukip.

Violence erupted when the BNP splinter group clashed with a larger group of anti-fascist protesters. Punches were thrown and placards were used as batons before police stepped in. Britain First – whose members dress in dark green hoodies – split with the BNP in 2011 and claims it has more Facebook “likes” than any other political party.

Jayda Fransen, the Britain First candidate for Rochester and Strood, expressed her support for Ukip’s Mark Reckless and claimed her party mirrored Ukip on a number of policies, including exit from the EU and restrictions on immigration.

A spokesperson for Ukip said: “We have no connection with Britain First and reject any association with them. We oppose this provocation against the community of Rochester.” A Tory insider insisted there had been clear evidence early in the campaign that people wearing Ukip badges were also supporting Britain First.

Farage told the Observer on Saturday night the byelection was the most important Ukip had ever fought, far more so than last month’s Clacton contest, won by the first Tory defector to Ukip, Douglas Carswell. If his party won well on Thursday, Farage said it would “completely change the arithmetic about what we might be able to do in some parts of the country and Kent in particular. This a constituency within the London orbit where the Tories had a good solid majority.” He said he was “confident but not complacent”. A good win was likely to persuade other Tory MPs to jump ship, he claimed.

Cameron has visited Rochester and Strood four times since the campaign began and has said that he will make a fifth trip. Tory ministers and MPs were told at the start of campaigning to visit several times.

At the 2010 general election, the Tories won in Rochester and Strood following boundary changes that altered the arithmetic in their favour. The Conservatives took 49.2% of the vote, Labour 28.4%, the Liberal Democrats 16.2%, the English Democrats 4.5% and the Greens 1.53%. Ukip did not put up a candidate.

Lord Ashcroft’s poll last week showed the extent of voter disillusion with all the established parties. It put Ukip in front on 44%, the Conservatives on 32%, Labour on 17%, the Greens on 5% and the Liberal Democrats on just 2%.

Asked if she thought she was going to win on Thursday, the Tory candidate Kelly Tolhurst said yesterday: “I believe I’m the best candidate for the job. But next week it’s up to the people of Rochester and Strood to decide.”