Margaret Thatcher always liked to remind people that she was following in the footsteps of Winston Churchill.

When television cameras filmed her in the Downing Street cabinet room, Thatcher would pull back the prime minister's chair and point out that "Winston" sat there in earlier times.

But Thatcher stopped short of likening herself to the man regarded as Britain's greatest war leader of the modern era.

Liam Fox, the defence secretary, today filled in the gap left by Thatcher when he compared himself to the great man.

The new Churchill emerged when he was asked by Tom McTague, the Daily Mirror's Political Correspondent, at a lunch hosted by Westminster journalists whether he regretted visiting a pub when British troops were despatched to Libya. This is what Fox said:

Given that until last night it was the last pint of beer I had I don't think it was entirely unreasonable. It is a bit like asking Churchill if he regrets having a drink during world war two.

Downing Street laughed at Fox's comparison of himself to Churchill, who famously relieved the tension during the second world war by copious drinking. Asked whether David Cameron had ever thought of Fox as a Churchillian figure, a No 10 spokeswoman said:

I am not entirely sure the prime minister would necessarily draw such comparisons of his cabinet members with figures of history. I just don't think that is something he does.

This is what Michael Dugher, the shadow defence minister, had to say:

Liam Fox is no Winston Churchill. Rather than comparing himself to someone who many rightly regard as the greatest Briton in history, Fox has to explain his admission today that defence capabilities have been cut by this government and that the strategic defence and security review was a spending review not a proper defence review. That admission is a complete U-turn from what he and David Cameron said last October.

Fox, who put in a strong performance in the Tory leadership contest in 2005, used his speech today to hint that he still has ambitions when he lavished praise on Cameron – as a coalition prime minister. Fox said that he did not have such skills, indicating that he sees himself more as the leader of a majority Tory government.

The defence secretary said it was right to govern as a coalition because Britain faces a national economic emergency. But he made clear that the coalition is no love-in as he reminded the Tory right, which is likely to have a decisive say in the next leadership contest, of his Thatcherite credentials. This is what Fox said:

People say to me how can a Conservative like you be in a coalition with the Liberal Democrats? Presumably 'Conservative like you' means an unreconstructed, free market, Unionist, Eurosceptic Atlanticist. The point is that the coalition needs to exist because there is a national economic emergency. Will we all love one another? Well, for those with short memories did the Wets and Drys in the Thatcher cabinet love one another? Did that Major cabinet love one another? For goodness sake people in the Blair government briefed to you on a very regular basis how much they loathed the very sight of one another. The thing is: will it work, can we work together? The answer is yes we will because we have to work together.

There was a mixed response to Fox's speech after he launched a strong attack on Labour and made a joke about Tony Blair's children.

This is what Fox said about New Labour:

I absolutely loathed New Labour, not only because they beat us three times, although that didn't really help in my affections. But the whole of that New Labour period was the ultimate Trivial Pursuit. I think it was the political equivalent of vanity publishing – part celebrity cult, part intellectual self delusion. I think we were regularly treated to the irrelevant to the unbelievable – from Margaret Beckett's top 20 caravan spots to John Prescott's 50 top classic Russian novels. That being the unbelievable part. We got Peter Mandelson's top dinner party recipes to Tony Blair: 'Why I smacked my children.' For those of you who don't remember that one, it's because he genuinely believed they were carrying weapons of mass destruction. So we sort of went through great guy, do God, can't do wrong, morphing seamlessly into saving Europe, saving the Middle East, saving Africa until we arrived at Gordon Brown saving the world which I suppose was a logical extension. Interestingly I was in Saudi Arabia recently and I was signing the visitor's book. I signed Liam Fox, House of Commons, London. Immediately above me was: Blair, Jerusalem.

One Tory was not amused: