The senior intelligence official responsible for Tony Blair's notorious dossier on Iraq's weapons of mass destruction proposed using the document to mislead the public about the significance of Iraq's banned weapons.

Sir John Scarlett, who as head of the Joint Intelligence Committee was placed "in charge" of writing the September 2002 dossier, sent a memo to Blair's foreign affairs adviser referring to "the benefit of obscuring the fact that in terms of WMD Iraq is not that exceptional".

The memo, released under the Freedom of Information Act, has been described as one of the most significant documents on the dossier yet published.

The disclosure supports the evidence of the former intelligence official Michael Laurie, who told the Chilcot inquiry into the Iraq war that it was widely understood that the dossier was intended to make a case for war and misrepresented intelligence to this particular end.

The role of the Joint Intelligence Committee is to present impartial intelligence-based advice to ministers. Alastair Campbell, Blair's director of communications, told Scarlett that the dossier's credibility depended on it being seen to be the work of Scarlett and his team of experts.

But the 2004 Butler review found that the published dossier had presented a more certain case on Iraq's weapons than was set out in the committee's reports. In spite of this, Scarlett went on to be head of MI6.

Scarlett's memo was sent to Sir David Manning, Blair's chief foreign policy adviser, in March 2002 after an early draft of the dossier had been drawn up covering four countries with "WMD programmes of concern": Iraq, Iran, Libya and North Korea.

Jack Straw, then foreign secretary, had commented that the paper "has to show why there is an exceptional threat from Iraq. It does not quite do this yet." In response, Scarlett suggested that the dossier could make more impact if it only covered Iraq. "This would have the benefit of obscuring the fact that in terms of WMD Iraq is not that exceptional," he wrote.

Clare Short, the Labour cabinet minister who resigned after the war had started, said: "Those words show that John Scarlett was in on the deception from the beginning and was being duplicitous deliberately."

Elfyn Llwyd, parliamentary leader of Plaid Cymru, said: "It is clear to me that John Scarlett was not an objective player in all of this." Llwyd asked why Chilcot had neither published the Scarlett memo nor questioned Scarlett about it. "It again calls into question the credibility of the inquiry," he said.

Following Scarlett's memo, the dossier was limited to Iraq but a week later it was put on hold for six months. Laurie told Chilcot that the dossier had at this time been "rejected because it did not make a strong enough case".

Significantly, Scarlett's memo was copied to Sir Joe French, Laurie's boss at the Defence Intelligence Staff. In his evidence to Chilcot, Laurie attributed his belief that the dossier was intended to make a case for war to what he had been told by French.